Home Care Price increases

One of the biggest mistakes I made in my Home Care Business was not increasing prices. In this weeks newsletter I will explain how I struggled by not increasing my prices, how I struggled when I did increase and what I could have done better.
If you are worried about increasing prices this will help you a lot!!!

Before we get into the nitty gritty of increasing our prices I just want to draw your attention to this photo 👇👇👇

Over the next few weeks, I will be calling many of you to talk about a Home Care Business & Marketing suite I developed. I’d love to chat with as many of you as I can. I honestly believe what I developed is a game changer for the Home Care industry.

I believe in the product so much I’m going to try and sell it to you all!!!!! So if you get a call from me, please give me 5 minutes. We can have some fun talking and I’m sure you will love what I have for you. Anyway, enough of that, how about increasing your prices!!

The Big Mistake I Made

Quite simply, I was scared to raise my prices, I thought if I did, I would lose business. So I didn’t. I kept my prices low because I didn’t 100% believe in my service and what people would actually pay for it.

I made assumptions about the market place not being able to afford increases. I hid behind my assumption and took comfort in not having to make a hard decision to increase.

This was a massive mistake as my costs were going up. My margins were squeezed and I was forced to pay a low wage. Attracting new care workers became hard because my competition could pay more. When I lost staff, I lost business because I had no cover.

Not increasing prices ruins your business. At first you won’t see the hard caused to you. It takes time for problems to arise but when they do, it’s often to late to do anything. This is why regular price increases are a must.

The good news at the moment is, people expect increases. They see what is happening in the economy and the cost of living, so they understand. The problem can be, if you haven’t increased the price for some time, a big increase upsets a lot of customers.

I’ll give you an example. A platform a friend uses just tripled it’s prices. The explanation was, they have added new tools (non of which my friend asked for) and they haven’t increased prices for three years.

When speaking with my friend he was furious. As he said, if they had increased prices every year, he would be paying what they now want without complaint. However to have such a sharp increase in one go hurt him. He has been a loyal customer and now he is paying exactly the same as new customers are paying. He sees this as an unjust action so is looking for a new company.

Guess What?

If you do the same, your customers won’t thank you. They will forget you didn’t increase for x amount of years and they will feel unjust. Trust me, this was exactly what happened to me. However if you regularly increase rates, most won’t even notice and those who do will understand.

But What if you haven’t increased rates and need to?

This is a good question and here is the best way I know.

First thing to do is increase rates to new customers only. Let’s say you are £20 an hour and increase to £30 an hour for new customers. Every new package goes on the £30 an hour rate.

Secondly send a letter to all existing clients to tell them you have increased rates for new clients to £30 an hour. Tell them you have good news, as a loyal customer they will remain at £20 an hour. Then tell them you will be increasing your prices to existing clients but as a thank you for staying you managed to keep the increase from happening until a date (3 months from now). Finally let them know you will only be increasing to £25 an hour, hence saving them £5 an hour.

Also give them three money saving tips to help them with rising costs. People love this advice and appreciate the effort to help.

When you do this, you don’t get so much pushback, people understand and feel pleased they are looked after as loyal customers.

What else can I do?

Once you have implemented all increases then never leave it to long to increase again. I increased every April at the start of the new tax year. Some of my clients do it after every budget as they see the time as a good opportunity due to the cost of living usually going up. Others do at different times. The important thing is, you put a note in your diary and increase your prices. Don’t fall behind the competition.

And Lastly

If you are scared to increase prices, I would suggest you have a service issue not a price issue. When our service is outstanding and we believe 100% in what we do, putting prices up is never a problem.

I never struggled again to raise prices as I got my service to the best in my area. You may not feel this is the problem but in my experience it usually is. Sometimes we don’t often see the ‘Wood for the trees’ as business owners we can look through Rose tinted glasses and like I did hide in our comfort zones.

Getting you out of this zone and helping you build the best care business you can is my expertise. So when I make that call and your colleague says there is a ‘Lee Taylor’ on the phone, why not have a quick chat. Buy from me or not, I’ll definitely be happy to spend some time helping you overcome what challenges you may have.

That’s it for this week, until the next, I’ll hopefully speak to you soon.