It’s certainly simple. If it works, it’s amazing how this simple tactic can simplify life so much.
But it’s scary in the planning. What if it doesn’t work?
Let’s think through some scenarios.
What if you double prices across the board?
The very worst case: you could lose all your business. Probably not likely, unless you have performance/service issues you haven’t been fixing.
More realistic: You could lose about half.
Now you have the same revenue as before. But you only have half the work and half the costs. Which means you also have double the margin. Who wouldn’t make that deal?
Or you could keep all your business.
Some entrepreneurs say their clients were just waiting for rates to go up. And they were happy to pay more!
If that undercharging businessperson is you, you’ve now just doubled your revenue AND your margin overnight.
So you can afford to hire more help, to service all your old business and deliver an even better experience.
For the extra money they’re paying, the customers you’ve kept are bound to notice their new, higher level of service. (And you should spend some of your new revenue telling them!)
They’re even happier with your company. If you ask why, they’ll tell you, “Well, you get what you pay for!”