We get this question a lot – WHEN is the best time to for your janitorial business or maid service to RAISE prices?
Well, the short answer, of course, may be something like – when the customer will happily accept it – without a fuss.
Sure, sounds simple, but when in the world will that ever happen?
‘Not in my lifetime’, you might think. Well, maybe. Maybe not. Here’s an insider tip to successfully raising prices:
It’s called TIMING. That’s right, timing.
Specifically, whenever possible, try to put through a justified price increase – when your cleaning business customer really
‘loves’ you and your current staff.
Well, ‘love’ may be too strong a word. So, how about – is exceptionally happy with – pleased, really likes, you know, is very satisfied with? You get the idea.
Why? What on earth does THAT have to do with a price increase?
Well, in running our own commercial cleaning company, even when we put through a very small and very overdue, price increase, IF our customer was NOT happy with our current cleaner associates for any reason, the increase had about as much chance as a well, a ‘snowball’s chance in you know where’!
Well, because the truth is PEOPLE make the decisions -real “flesh and blood” people; emotional people, not machines.
And when your contact – the building owner or property manager you work with, thinks about whether to approve your increase, or not – he or she is affected by things like —- whether or not they and their staff LIKE your current cleaning staff.
So, how do you know if you have that kind of highly-appreciated employee on your staff?
You know the signs, they’re the ones that get the pats on the back, the thank you’s, the holiday hams – and maybe, are even invited to the company picnics.
Well, when a company likes the cleaning they are getting AND has ‘that kind’ of a loyal relationship with your cleaner(s) – getting reasonable and justified price increase approved isn’t too tough!
Heck, we’ve had buildings where the justified price increase ‘sailed through’ – where, while we were certainly providing qood cleaning, but the cleaning associate currently assigned to the account, was, to be fair, not ‘the cream of the crop’.
And, I’ve got to believe the fact that the customer trusted our cleaning associate and considered them to be a part of the ‘team’ and ‘friend’, played some part in explaining why the increase went through without much resistance.
We understood it likely was not the cleaning alone that produced this kind of loyalty.
It was the person.
Let’s be clear, I am NOT suggesting any cleaning business or maid service owner ever take advantage of any client by putting through an unfairly large increase, nor an increase where one is not justified, simply because you know they ‘love’ your cleaner.
Not at all.
But where an increase is called for, knowing if the company has very positive feelings about you and your cleaning associate(s) can be one important thing to consider ahead of time.
You Can Do This, You Really Can!
Hi Victor, you’ve asked a good question. There are of course many ways to let your client(s) know about a pending price increase for your services. In fact, you can (and many want to) search/look online; for additional examples offered by many cleaning business owners in a variety of facebook groups. It’s a topic that comes up quite frequently; and many members in these groups share their own way of handling/announcing an increase in their 1) hourly rate, 2) per visit charge or 3) monthly price for cleaning. However, as an example, it can be as simple as explaining...‘To continue to provide the highest level of cleaning and attract, train and keep the best quality cleaning personnel, as of a (certain date) you need to increase your (hourly rate) or (per visit charge to their home) or (monthly price to clean their office) as follows….’$ X’ But, the wording is really up to you and can reflect your own explanation for the increase. But, here are a few other things you may want to consider when considering raising your prices: 1.) Be aware of both your company's overall financial picture - as well as, the actual profitability of the account in question to you when deciding on if the price should be changed, and if so, by how much. 2.) Be confident of what a desirable/reasonable price for the job would be. It may be, for example, already be priced correctly and that, in fact, no increase is necessary, or it may be under priced and need to be adjusted. We always want our prices to make sense; be justified and explainable by the value we deliver. 3.) Again, when a price increase is necessary however, it's important to be confident in your own mind why the 'percent or dollar figure' adjustment is needed - and to be prepared to clearly explain it to your client. 5.) Finally, the timing of price increases can be an important factor in whether or not they will be approved. Therefore, you may want to take the 'temperature' of your client's current attitude toward 1) your current cleaning performance, 2) current cleaning personnel and even 3) your cleaning business in general, when determining whether to increase your price, by how much – and when. The practical reality is that 'people buy from people'. And, if your client and their employees and/or tenants are delighted with your company and 'love'/appreciate the cleaning personnel assigned to their account - you stand a better chance at getting a positive reaction to your increase request - than if that's not the case. Sorry for the long explanation, but I wanted to answer your question and provide these notes as thoughtfully and completely as possible. Hope this helps, Matt CleanGuru Support
Great article! But, is there an example of a letter that we can use for price increases ?