Guide · Pricing
How to raise your prices as a contractor
If you're booked out for weeks and win almost every estimate, the market is telling you something.
Raise prices when you're booked out, winning nearly every estimate, or your costs have gone up. Start with new customers: quote them the new price from today. Give regular customers a short notice with a date. Honor estimates you've already sent until they expire. Recalculate from your real costs rather than adding a round number.
Signs you're charging too little
- You win almost every estimate you send.
- You're booked out for weeks and still turning work away.
- Your hourly rate hasn't changed in a year or more while materials, fuel and insurance have.
- After expenses, you'd earn more working for someone else.
Work out what you actually need with how to calculate your hourly rate.
How to do it
- Recalculate, don't guess. Start from your costs and the pay you need, then set the new rate and your common flat prices.
- New customers first. Every new estimate goes out at the new price from today. Nobody has to be told anything.
- Honor what's already out. Estimates you've sent stand until their expiry date. That's what the date is for; see how long an estimate should be valid.
- Give regulars notice. A short message with a date a few weeks out is enough. No long explanation.
- Watch your close rate. If it drops a little, the price is probably right. If it collapses, adjust.
A message for repeat customers
"Hi [name], a quick heads-up: starting [date], my rates are going up to [new rate / new price for their usual job]. Anything we book before then stays at the current price. Thanks for working with me, and let me know if you'd like to get something on the calendar."
In Settle
Settle prices estimates with your hourly rate from your business profile and the prices you've charged before. Change the rate once and new estimates use it. When a reused price is out of date, change it on the next estimate you send and Settle uses the new price from then on.
How often should a contractor raise prices?
Review once a year, and sooner when costs jump or you're consistently booked out.
Do I need to tell customers before raising prices?
New customers just get the new price. For regulars, a short notice with a date is good practice. Honor estimates already sent until they expire.
How much should I raise my prices?
Enough to cover your real costs and the pay you need, worked out from your numbers. Then watch how many estimates you win at the new price.
Update your prices once, and Settle uses them on every estimate.
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