Here is the Pilates Teacher's Guide to Raising Prices in 2015.
In the wake of my last two blog posts, which have started some interesting and contentious discussions in the pilates teaching community, several pilates teachers have asked for some guidance in raising their rates in 2015.
Note that I am not suggesting that you have to, or should, raise your prices. But if you feel you need to, here are some ideas.
First, let me back up to my post on pricing. In that post I recommend that you look at some simple math before setting prices. The equation is:
I want to make X amount of money per year and would prefer to work Y number of hours per week, so I will need to make Z amount of money per hour/day/month.
In my example, if you want to make $120,000 per year and only work 20 hours per week, you will need to make $125/hour. Note that I don't say you should charge that, but that is the math.
It is my view that if we as Pilates teachers are not earning enough to thrive, then it will effect our teaching. We will be worried, possibly resentful at teaching a lot and still struggling, and it will bleed into our client interactions. This has happened to me and to my colleagues, which led to this raising prices discussion.
Now, if you didn't make that simple math calculation before you set your prices, or you did but it's been a few years and the numbers are different, you may need to raise your prices.
Do not raise prices without doing the math first! And make sure that your discounted packages cover your costs.
But how can you raise your prices without upsetting and possibly losing your existing people?
1. Raise prices on new clients first.
The first inroad you can make is to raise prices on new pilates clients, while allowing existing clients to stay at their current rate for a limited period. When I raised my rates last year, I started by charging new clients more for a month. So I notified people that new rates were going to be happening on 8/1. The new rates went into effect for new folks on 9/1, but current people had until 10/1. This made my current clients feel loved.
2. Offer a few packages at current prices to current clients.
The next step is to let your current clients know that even though your pilates prices will increase, they can purchase a few packages at the current price. In my practice, I offered current clients the ability to buy up to 30 sessions at current prices. This gave me a little extra cash and I didn't lose money, because it was not a sale. And my current clients still felt loved!
3. You may lose a few clients, but you will gain others.
I was lucky enough to only lose one client in my increase, but she was going through financial hardship anyway and would have stopped. Note that I did offer her a lower price, and this was her response,
"I will not bargain with you because you are too good and there are plenty of lower-priced teachers that are fine for me now. I feel lucky and spoiled to have had you for as long as I did. You are by far the best Pilates teacher I have ever been to."
I couldn't argue with that. I just said Thank You. And she still refers people to me!
[For more on why my clients feel like this, please see my post on serving your niche.]
At the end of the day, costs go up every year for all of us. Insurance, rent, groceries, taxes, and even public transportation go up. We need to pay our bills, have a little fun, save some money for fun and retirement, and thrive as Pilates teachers.
I am able to see some clients at a greatly reduced rate without worry or resentment, because the majority of them pay my full price. And I don't have to work like a Pilates automaton anymore, so I can have a life outside of the studio.
So take the leap! If you know your prices are too low to meet your needs, raise them! Just make sure your level of service and care matches your price.
Happy new year!