Communicating Price Increases to Customers

“When you’re high quality and reliable, people will keep coming.”

One of the hardest things in business is telling customers that prices are going up. Nobody likes to hear it and, truthfully, I don’t like saying it either. Years ago, when I was managing a restaurant in Philadelphia, a hamburger with fries was $2.95. My boss said we needed to raise it to $3.10. I worried people would flip out just because the price crossed from the “two” to the “three.” You know what happened?

Nothing. Nobody said a word.

The lesson stuck with me over the years. People don’t mind paying more when they understand the why and still feel they’re getting value.

When you need to raise prices, tell your story. Explain the reasons and be honest. Maybe it’s due to higher food costs, wage increases, or supply shortages. Most customers don’t keep up with the realities of business costs. When they know the truth, they’re more understanding.

If you can, give them notice before the change. People handle change better when they have time to process it. And if your product or service is consistently great, your customers will stick with you. The best restaurants never go empty, no matter the economy, because customers trust the experience.

When you consistently deliver quality, reliability, and peace of mind, people no longer feel like they are just paying for a product. They are paying for predictability and often will be willing to pay a little more to keep it that way.

Before you move forward with that next price update, make sure you have been giving customers enough reason to keep believing in what you do even with a higher cost.