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How to Write a Price Increase Letter for Customers [Free Template]

June 7, 2023 8 min. read
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When you’re ready to increase your prices, you need a plan to do it right. A price increase letter is a great way to communicate price changes with customers while maintaining transparency, professionalism, and trust.

Read on to learn how to write a price increase letter, additional ways to communicate price increases, and when it’s time to raise your prices.

Price increase letter template

Here are some price increase letters you can copy, paste, and edit to use for your own clients.

Generic price increase letter templates

Lawn care price increase letter template

Use this template to notify your lawn care customers of your upcoming price increase.

Cleaning service price increase letter sample

Copy and paste this letter template to let customers know you’re increasing your cleaning service prices.

Tips for writing a price increase letter

Once you’ve determined that raising your prices is the right path for your business, you need to ensure that you communicate the change to your customers properly. Here are some best practices to keep in mind when writing your home service price increase email.

1. Tell your employees first

Before you tell clients about a price change, you need to make sure that you communicate it to your staff first. When all of your staff members are on the same page, it ensures consistency in quotes and invoices as well as customer service inquiries from clients.

Let office staff, employees, and contractors know about the upcoming pricing changes before notifying customers to avoid any issues down the road with inconsistent information.

2. Give your customers plenty of notice

If you have recurring clients on weekly, monthly, or seasonal contracts who will be affected by a price increase, notify them well in advance.

Providing plenty of notice helps clients feel respected and prepared (plus, you’ll avoid angry phone calls after surprise bills).

Pro tip: Try to give clients one to three months’ notice before raising prices.

3. Be clear and concise

Make sure your letter is direct and to the point. Clearly state what the new pricing will be and when it will take effect.

Then, offer an explanation for the increase and how they can reach out with questions or concerns. Burying your price increase in a lengthy email will only confuse or frustrate your customers.

4. Add a personal touch

To show you value their business, include personal details for each client, like their name, the services they purchase, and how long you’ve been providing those services.

READ MORE: Thank-you notes for customers: templates to show your appreciation

5. Explain the price increase

When explaining the cost increase to clients, having a reason helps them understand why they’ll need to start paying more.

No one wants to pay higher bills, so being transparent about your reasoning (inflation, cost of materials, labor) will help justify the increase for customers.

“Explaining why you are charging what you’re charging gives you a leg up. And it’s not bragging — you’re explaining your value,” says Tyler Rasmussen of The Pool Chasers Podcast.

READ MORE: What to do when customers say your price is too high

6. Offer support

Let customers reach out with questions or concerns about your price increase by including a couple of contact methods such as your phone number or email address.

7. Send a follow up reminder

Sometimes emails end up in spam folders, or are simply overlooked. Send a follow up email or text to make sure your customer received the price increase information before your new prices come into effect.
READ MORE: 5 payment reminder email templates to send to customers

Get more expert tips for telling customers about price increases (without losing them) in this video:

When to increase prices

Some service businesses raise their prices a small percentage every year to account for inflation. Others increase prices on customer anniversary dates, or when minimum wage goes up. 

If you’re not sure when to increase your prices, here are a few signs that it’s time:

Your costs increase

Labor, materials, fuel, overhead, and most other business expenses will increase in price over time. This can be due to inflation, suppliers, the labor market, or other unexpected factors.

If you don’t adjust your prices to reflect these increases, you’ll be left paying for them out of pocket.
Keep an eye on your profit margins each month to monitor any increase trends so you can make adjustments to your pricing before they become a problem.

Increase your Prices - Quote from FaceBook for Jobber 3

FREE TOOL: Use our profit margin calculator to set the right prices

You want to grow your business

Price increases can also be used as a pricing strategy to help you reach specific business goals, like hiring a certain number of new employees or expanding to a new service area.

If you’re looking to grow your business, raising prices may be the best way to fund your expansion.

Increase your Prices - Quote from FaceBook for Jobber 5

You need to filter customers

When your prices are low, you’ll usually attract customers who value savings above quality or workmanship. These customers can actually cost you more than they’re worth.

 If a customer leaves over a small rate increase, chances are you’d have lost them to a lowballing competitor anyway. Raising prices can help you filter out these customers (or problematic ones) so you can target clients who are interested in bigger or longer-term jobs.

Increase your Prices - Quote from FaceBook for Jobber 6

You’re in demand

It’s normal to price low when you’re just starting your service business to attract early customers. But once you start booking jobs regularly, you’ll need to increase your prices to come up to market value.

Increase your Prices - Quote from FaceBook for Jobber 4

Your competitors are charging more

Stay on top of industry trends by monitoring how your competitors are pricing their services. If your competitors are charging more for the same service, it’s time to increase your pricing to align with market standards.

READ MORE: 10 simple ways to increase revenue from existing customers

Raising your prices allows you to hire more skilled labor, pay yourself and your staff bigger salaries, and work on more exciting jobs with clients you enjoy.

Copy and paste one of the templates above to effectively communicate your price increase with existing customers and start earning more for your hard work today.

Originally published in March 2021. Last updated on June 7th 2023.

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