3. Is NOW the Best Time to Raise Prices? Maybe.

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Nerds. Michael King here. And welcome back to another episode of the Connected Accountant, where we believe that as the CEO of a bookkeeping, accounting, or fractional CFO firm, you should be making more money than when you worked in corporate America. We believe that you should be serving clients that you love, and we believe that your personal life should be directing your business, not the other way around. Once again, my name is Michael King, and today I want to share with you one of the biggest things that I struggled with when I was first getting in the game. And this is one of the questions that people inside my community are asking me very, very frequently. And that question is, when do you know that it's time to raise prices? And specifically, what I'm talking about is when do you know that it's time to raise prices for new clients? I'm not talking about how to raise prices for your existing clients. We'll talk about that in another episode. If you'd like. In fact, drop me a comment in the DMs and, and let me know if that's something that you want me to walk through. How do you raise prices for existing clients? I'd be happy to do an episode on that. But today we're focused on how do you know when it's time to raise prices for new clients? Now, I don't know about you, but this was a question that kind of ate at me internally for a long time when I was first starting out. You know, when you launch your business, you come up with a price point that you think makes sense for you and for your clients. But how do you know when it's time to raise those prices? Well, I found that for me, there were three kind of primary indicators, three things that I as a signal that it was time to raise my prices. And so I'm going to share those with you right now. The first one is once I had all of my bills paid, you know, for many of us, our numbers business, bookkeeping, accounting, fractional cfo, we rely on that to pay our mortgage or our rent or to put food on the table. And for me, I had to just, you know, whatever price people were willing to pay me when I first started, I kind of felt like I had to do that. For me, once I felt that safety and security, that, okay, all my bills are paid, I'm not in a place of financial scarcity anymore. That was like the first indicator to me that, all right, it's now safe for me to start thinking about raising my prices. And so I would encourage you. Yeah, I want you to get paid what you're worth. But I think that it makes a lot of sense, especially when you're first getting started, to wait until you have that financial security that, yeah, you've got enough revenue coming in. You. You figured out how to sell at that particular price point. You're probably good at it at that price point by now. Wait till your bills are paid or until you feel a little bit more financial security before you raise your prices. Number two, this one's a little bit more advanced. Once I got to the point that I was closing 60 to 70% of new sales calls, I realized it was time to raise my prices. And in fact, today, my benchmark, or my standard, is if I'm closing 50% of new leads that come in. So I get on a sales call and I go through my whole sales process. If I'm getting yeses more than 50% of the time, and definitely once I'm at that 60% or 70% of the time, that's normally a pretty good indicator to me that it's time to raise my prices. And here's the cool thing. If your bills are all paid and you're closing at that 50, 60, 70% rate, you have some bandwidth now. You've got some bandwidth where you can say, all right, if I raise my prices on the next sales call and they say, no, I'm not freaking out because I know that my bills are paid and I know that if I need to on the next sales call, I can sell it at that lower price like I was selling before. And so it gives you a lot of, like that, again, that safety, which is so important to us, especially, again, if our income is what's paying the rent and keeping the kiddos fed and those kinds of things, when those two things are both true, it really creates this space for you where. Where you're not feeling kind of scared and where you're not feeling insecure about doing it. And I will tell you, when you have those feelings of scarcity and insecurity, it will definitely translate onto a sales call. And the person on the other end of that zoom call will absolutely feel it the third time. That's an indicator for me that it's time to raise prices. It's kind of a gut instinct. You know, I can normally start to sense it and feel it. When we've had prices at a certain level for a while, when we've started getting really good at what we do, maybe we've added some additional value to our packages, things that our Clients are loving. I'll start to kind of get that itch inside. I'll kind of feel it in my stomach, like, hey, this is probably a good time to go ahead and raise prices. When there's a ton of leads coming in, where there's a list to get on a sales call with me, kind of when you've just got that swag, you'll kind of start to feel it. Now I realize that when I'm telling myself or asking myself, hey, is it time to start raising prices? That's normally a good indicator that I need to start thinking through how am I going to communicate better on sales calls that, you know, hey, this is what we're worth and now this is our new price. You know, I would encourage you, trust your instincts. Your instincts probably know when it's time to do that. Now, that said, I think there's one thing, and I alluded to this earlier, there's one thing that has to be present in order for you to successfully raise your prices, and that's confidence. It is confidence. Like I said, when you don't have that confidence and that swag, people on the other end of the conversation can feel it. And then they start to doubt you because you're doubting yourself. And so what I would encourage you is to get a. This was like the most important thing to me is I got a framework in place for how to handle sales calls. You know what I did when I first got into the game? Somebody said, hey, Mike, I want to talk to you about your fractional CFO service. I'd show up for the call, and it was kind of like the wild, wild. I had no idea what direction the call was going to go. And because I didn't know what to expect or what direction to go or how to lead the call, I was nervous as heck. You know, I don't know if you've ever felt that way before, but the self doubt, the self talk, the imposter syndrome, the anxiety, the stress, right, all that stuff started to pile up. And those sales calls, honestly, they were dumpster fires. I felt so bad for the people that were on the other end of those calls. But once I got a framework in place, I was able to show up with a lot more confidence because I had an idea of how the call should go. I knew kind of directionally correct the types of things we needed to talk about so that we could get to a place where they understood what I was all about, where I understood what they were all about. And because I had that, they felt a lot more confident in the process. So I look forward to seeing you back here next week for another episode of the Connected Accountant. See you then.