I got an email this morning from a pet sitting business owner I recently coached who raised her rates based on doing the numbers.
WHY? She realized she wasn’t making much money at all after paying expenses and taxes. Ooops! When you realize you can work at Mcdonald’s, get health benefits, and make more money just walking in the door per hour than you can in your pet sitting business, something’s gotta change….
HOW? You need to increase your profit by cutting your costs and increasing your revenue. This usually comes in the form of raising rates. It should be a mathematical equation.
Although, understandably, most get scared when doing this.
In fact, this particular pet sitter said: I’m scared. I don’t think raising rates was the right thing to do. Clients are commenting, some are mad. Some have even left me. What do I do?
My Open Letter to Pet Businesses Afraid of Raising Rates:
Dear Pet Sitter:
Who runs your business? Who pays your bills and saves money from their hard working days?
YOU do not the client. So…
What you are feeling is natural. You are not the first to feel this way and you certainly won’t be the last. You have to remember a few things….
- You are making a business decision based on number and facts. You can’t work for free and you need to make money in order to stay in business. You can not go off emotion.
- Expect that every single client is going to say something about the rates. Expect it and know what to say so it doesn’t catch you off guard. It is all in how you word it. “Yes, the rate did go up $3 for you. actually, it went up $5 across the board, but since you are a long time/existing/loyal client, I gave you a $2 discount” (If that is what happened)
- Understand and accept that you will loose people but be OKAY with it! The new ones you sign will make up for it!
- Balance is key. If you can’t afford to potentially lose a lot at once, wait until you have a bunch on the new rate and then look back and raise the rate. It is a balance that only you can feel out.
- You are not experiencing anything that any of us haven’t. It happens all the time but it is NECESSARY if you want to thrive in your business!
- People who will not pay what THEY THINK you are worth, those who won’t pay your rate are NOT your clients… and you have to accept that.
Hold your head high. Know that you are an established business looking for a very unique client. You are the Mercedes of the pet industry!
Now lets talk specifics.
Do you have a pet sitting business or dog walking business? Depending on which you have I have different suggestions for you in how you let your clients know.
Dog Walking: I would suggest give them 2-4 weeks notice that their rates are increasing. If you aren’t in a position that you can afford to lose some clients, then I would gain more new clients at the newer prices before you tell your existing clients.
Pet Sitting: I would not send a letter. These services are not every day. They are traveling and prices can vary. I would update your price in your software system and let the invoice do the talking for you. If you announce it, you are opening a chance for people to protest. After all, they are your prices and these days it seems that only the utility company sends price increase letters.