Raising Your Prices

Hi, this is Dave Kats for Therapist Consultants and I have a tip for you.

You know, we're often asked, "How do you go about raising prices?" Well, we suggest that you raise prices more substantially when you do, but less often. The reason for that is because people don't complain about price raises, unless they've been through two or more price raises, then they wonder about you raising your prices. If every year you raise your price $5, it eventually takes a while to get your price up there, but people feel like they keep getting nickeled and dimed to death. Raise your prices less often, but more substantially when you do.
Let me give you an example. If you had 100, you surely want to go 125 or 135 right now. If you're 125, you want to go 150. 150, you want to go 175 or 185, and so you want to make significant jumps when you make those jumps. Here's how you do it. Where a patient was likely to see it like on your front desk, if you have a front desk, just take a three by five card and say, "Effectively on this date office visit will be $135 or $165," Put that up about three weeks ahead of the time, and then leave it up for two weeks after and then take it down. If anybody asked you about why you're raising prices, you simply use this stock answer, "Every so often I raise my prices according to inflation and my cost of doing business." That's all you do, and you just dismiss it.
Now, one of the things that we're doing, we're majoring on a minor, nobody is going to complain about your raising your price. You'll be surprised how everybody takes it just in stride. Realize this, that if you raise from 125 to 150, you're getting an extra $25. That means you'd have to lose about one out of every five patients before it made any difference whatsoever. Maybe actually, one out every six patients before made any difference whatsoever in your practice financially. You're not going to do that. They're all going to stay with you. Now may be the time to raise your prices. Even if you're mostly insurance, the cash portion of it will still make a difference.

This is Dave Kats. Thanks for listening