Is It Time to Raise Your Prices? Here’s How to Tell… 

*This article is addressed to those business owners who have been in business at least one year. 

After running a business for several years, I’ve realized that no matter what a business owner charges, there will always be people complaining that the price is too high. 

On the contrary, when a business owner charges low prices that were barely profitable or not profitable, no one says, “Hey Business Owner, you need to charge more!”.

The point here, is that a business owner must charge a price that keeps the business profitable. One of the first questions I ask when I sit down with a business owner is, “How are your prices compared to your competitors? Are you on the high end, in the middle, or on the low end of the pricing structure?”. 

If the client says they are on the low end, I strongly suggest moving to at least the middle price range. 

If you are the business owner, here’s another important tip: If everyone always agrees to your price, you are mostly likely not charging enough. 

Does Starbucks care that their coffee is expensive? Nope. Because they are not trying to gain the gas station coffee drinkers as clients.

The monthly profit & loss report is a great way to help the business owner determine if they are not charging enough. If your business income, minus your business expenses, equals a profit that is too low to give the business owner enough to pay their personal expenses (with discretionary income left over), then it’s time to raise your prices.