The beginning of the year is a natural time to contemplate price increases—whether through annual rate card adjustments, negotiated increases for recurring relationships, or new statements of work (SOW) replacing expiring ones. Each of these serves as a transition point to communicate your value, highlight changes in your business, and set expectations for higher pricing without catching clients off guard.
However, no price increase is risk-free. When asking an existing client to pay more, it’s critical to consider the potential pushback and plan accordingly.
A concept I love in business and life is making deposits before taking withdrawals. This applies to health, relationships, and, most importantly, client relationships. Before requesting a price increase, you need to have built up relationship capital.
Proof of strong client relationships can be:
The key is recognizing where you’ve added value and effectively communicating it in a way that resonates with your client.
If you’ve established trust and delivered on your promises, most clients will accept moderate price increases of 1-4% without major objections. A cost-of-living adjustment (COLA) can often justify this. The US Bureau of Labor Statistics CPI data provides a commonly accepted basis for COLAs, and many long-term contracts automatically include CPI + additional percentage to account for inflation and rising costs.
Regardless of the price increase, unless it’s pre-negotiated, always provide a heads-up—typically 60-90 days in advance.
Clients, even in good times, dislike surprises. Giving them time to acknowledge, understand, and internalize the increase makes acceptance more likely—especially when the client isn't the final decision-maker and must get approval from their boss or procurement.
Baking price increases into agreements for agencies with recurring or retainer contracts can help. At Upsourced, for example, we operate on a month-to-month model without requiring annual commitments. However, our contracts include a 3% price increase on the first anniversary and annually thereafter.
This approach:
✔ Keeps client teams focused on delivering value
✔ Reduces the need for hundreds of upgrade conversations each year
✔ Filters out potential problem clients who might resist fair adjustments
While it may create some friction initially, it saves significant effort in the long run.
If you need to raise prices immediately and don’t have contractual mechanisms in place, own it.
Uncertainty in your tone invites questioning. Confidence, backed by data and rationale, strengthens your case.
Most clients understand that good work costs more, but they don’t always have the final say. If procurement or other decision-makers are involved, know the players, the decision-making process, and the timing.
Here is a quick example:
Understanding these dynamics makes a big difference.
The longer you delay price increases, the harder it becomes to catch up. Avoid big, sudden jumps by reviewing your pricing portfolio twice a year for opportunities.
✔ Be diligent.
✔ Keep a record of added value.
✔ Focus on the client’s perspective.
With enough deposits in your relationship bank, your clients won’t mind the occasional withdrawal.