Increasing your rates and the break-even analysis

I’ve mentioned this before, here, the break-even analysis, yet I’m going to bring it up again.  I think it’s important. 

I’m going to show you why even if you did lose a few clients by raising your prices, the amount of money you’ll make will still go up. 

Just for the sake of numbers, let’s say that you’re an independent therapist working out of your house.  You currently charge $50 for an hour session.  You do an average of about 20 hour long massage sessions a week.  You’ll be grossing $1,000 a week, right?  Not bad…

However…

Let’s assume that you raised your fee to $60 an hour and three clients stopped seeing you because it got a little to pricey for them.  You’ll still make out ahead because $60 X 17 = $1,020.  You’ll actually be making $20 more per week while working three less hours! 

Not only that, but you’ll be replacing those three lost clients by attracting new clients using smarter marketing techniques that’ll fill those time slots, if you choose to, and make $200 more a week doing the exact same amount of work.  $60 X 20 = $1,200.

Another way to help minimize losing clients due to increased prices is by giving your clients added value. 

You can do things like add hot packs at no extra charge, adding more nighttime hours for their convenience, giving each client a bottle of water after each session, etc.  Try and think of different ways of adding more value to your session that will help offset increased prices. 

If you would like me to e-mail you a quick and easy to use excel spreadsheet on break-even analysis, reply here or send me a message in private.

Kris

www.massage-marketing-solutions.com