21 September, 2017

There are many reasons for wanting to increase your price. Maybe you set your prices too low in the beginning. Perhaps your demand is now so high that you’re turning people away and have no other way of increasing your salary. Or perhaps you feel your time is worth more now you’ve gained a heap of experience.

Whatever the reason, raising your prices can seem like daunting task. You might start asking yourself questions, like do you only raise the price for new clients? Do you raise the prices for all clients? Do you test it with some clients and see how that goes? Will your clients talk to each other and discover they’re paying different prices? Will you lose clients if you raise prices?

This can be an arduous time for any PT and a conversation / situation you’d rather not be in. However, I’m here to give you some advice on what to do and how to do it. And if you should.

I’m going to use an extreme example, so that anyone in between will be able to use this advice and adapt it to their own situation.

Say you’re only charging $20 per session, because at the start you just wanted to get as many clients as possible. At this rate, if you had 8 sessions per day, worked 5 days per week, and take the standard 4 weeks off per year for holidays, the maximum you can expect to year is a yearly earnings of $38,400. You are worth more than that. You’re already working as long as you want to, so you need to increase your prices.

Before doing anything you need to work out what you believe your sessions are worth. Or better yet, what you need to earn to live comfortably. Then you can work backwards to work how much to charge for each session.

Let’s say you believe you need $80,000 per year to live comfortably, to work backwards follow these steps:

$80,000 / 48 week = $1,667 per week

$1,667 / 5 days = $333 per day

$333 / 6 sessions (assuming you’ll lose some clients) = $56 per session.

Your new price should be $56 per session. Now you can consider if your sessions are worth that. If they are, great start working on a strategy to increase to that price. If not, work on improving your offering and then work on increasing your price.

You can’t simply bump up the price straight away, especially if it’s such a bump. With these figures, that is more than double what people are currently paying. Hitting clients with a 100% increase in cost will likely alienate a lot of clients. If it’s only around $5-10 increase to get to your new price, you might be able to do it in one go.

As we have a $26 increase to make up, we’ll have to be more strategic. So here’s how you do it.

Firstly, you need to understand that this will be a long process, and as such you need to put deadlines in place and record them in a calendar. Deadlines will help you to keep on track, help you remain aware on the time that has past, and give you plenty of time to work on your clients and ease them into the change. In this example we’ll increase our prices to $30 per session to begin with, and do it within a couple of weeks, then we’ll raise it to $40 in 6 months’ time, and then $55 in 12 months’ time. This gives your current clients time to adjust and grow with you. It also gives you time that you might turnover many clients anyway so the change will occur naturally.

Secondly, if you have any new clients wanting your services, you can put them onto a higher price straight away, in this case we’ll put them straight onto $40 per session, and we’ll be upfront that the standard rate is $55, but they will get a rate of $40 until you plan on increasing the price, that date you put in the diary. This way everyone is on the same price and you won’t get confused by who’s paying what. The new clients will already be aware that the increase is coming.

Next, it’s important to offer an increase in perceived value to negate any complaints. Some people won’t want to pay you more if they’re not getting anything extra. Whereas some of your best clients will happily pay more for the excellent service they’ve been having.

Side note: A key point with increasing your prices is that you are currently delivering a service well above what you’re charging, if you’re delivering a $50 service and charging $20, people will see the rise coming. Whereas, if you’re delivering a $20 service, you’ll struggle to increase your price and keep clients.

Here are some quick ways to add value to your service without too much effort in the long term. Once set up they take minimal upkeep:

  • Include professional monthly fitness reviews (part of your sessions anyway).
  • Write a nutrition advice pamphlet, save it as a PDF, have a designer friend make it look pretty, or learn yourself and email it to your clients.
  • Take care of payments through direct debit – professional and no more asking for money.
  • Accept credit card payments – using a company like https://squareup.com/au.
  • Invest in upgrading your equipment (i.e. bands, boxing gloves etc) you can claim it all back at tax time.
  • Write a monthly newsletter with advice and news.
  • Build a website that looks expensive – using Squarespace (we have a marketing course that includes how to do this).

On another note, if you want to increase your salary whilst strategically increasing your price, you can look at other revenue streams. Here are some ways to increase your salary:

  • Start a weekly social bootcamp for your clients and others to join in
  • Sell branded gear. Some of your clients would love to buy a Hoodie with your brand on it.
  • Sell online programs. Some people prefer to do the work in their own time or can’t afford a PT
  • If you have a large following on Social Media, contact companies saying you’ll promote their goods if they’ll pay you a small sum. The amount you can charge depends on your followers and their engagement with you.

 

Finally, if you’re afraid you’ll lose too many clients by raising your prices to something you feel you are worth, have an honest conversation with the clients you have the best relationships with. They will either agree that you’re not charging too much or tell you if you’re trying to raise them too much.

In my experience, you’ll likely find that you’re worrying over nothing. As long as you raise your prices in small increments over long periods, like those mentioned above, most people will not even question it. An extra $10 per session for something they love and are getting huge benefit from isn’t going to worry most people. You might find that raising the price will just show your clients that you are giving them a great service that’s worth more.

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