the perception that you provide a higher quality service , clients are more likely to accept paying a higher fee .
Opposing this is the fact that by setting your fees too high , you may exclude those who do not have the capacity to pay , thereby denying that section of the community access to the results that only your services may be able to provide . However , you still need to ensure that your fees cover the costs of operating the business as well as providing you with an appropriate level of income .
Ultimately , after all of the time , work and money that you ’ ve expended to get where you are professionally , you need to be paid properly , so you need to set your fees accordingly . It ’ s not unreasonable to take the view that because we encourage our clients to feel secure and fulfilled , and to grow personally and professionally , that we need to be renumerated in a manner that allows us to be doing the same thing .
Fee Increases
As mentioned earlier , in most cases people select our services based not on price , but on the perceived value that we
AS WELL AS THE NEVER- ENDING INCREASES IN YOUR COSTS , A FEE INCREASE IS ALSO JUSTIFIED IF YOU ' VE ADDED TO YOUR SKILLS . ANY POST-GRADUATE TRAINING THAT YOU DO , OR SERVICES THAT YOU PROVIDE THAT ARE IN ADDITION TO THE NORMAL CONSULTATION AND / OR TREATMENT THAT MIGHT BE PROVIDED BY YOUR PEERS , ACT AS PERFECTLY REASONABLE JUSTIFICATIONS FOR A PRICE INCREASE .
can offer them , and , because it ' s usually the case that we ' re more sensitive to the price that we charge for our services than our clients are , many of us face significant internal conflict regarding fee increases . Either way , if you consider the effects of inflation on both your professional and personal expenses , it makes no sense not to regularly increase the costs of your consultation / treatment and medicines to allow you to keep up with those increased expenses . All things being equal , a failure to do this essentially means that over time you ' ll be going backwards financially .
In general , fee increases are best done annually - either at the beginning of the financial year or the beginning of the calendar year . It ' s unlikely that a small rise in your pricing will have any real impact on your client intake , but if you have concerns about the possibility of a price increase turning potential clients away , a simple example to think about may alleviate those concerns . If your gross profit margin was 40 %, and you increased your prices by 10 %, you could afford to lose 20 % of your clients and still retain the same gross profit .
As well as the never-ending increases in your costs , a fee increase is also justified if you ' ve added to your skills . Any post-graduate training that you do , or services that you provide that are in addition to the normal consultation and / or treatment that might be provided by your peers , act as perfectly reasonable justifications for a price increase , although it should be made clear , via your website and other means of communication , what your client is receiving for the price that you charge . In most cases , your current clients will understand and accept your price increase , and your new clients won ' t be aware that it ' s occurred .
The other thing to bear in mind is that the visibility of a price increase can be adjusted by the price increase increment that you use . For example , lifting the retail price of a medicine from $ 17.00 to $ 19.00 instead of the more noticeable $ 20.00 makes the increase a little less visible and any pain associated with the price increase a little more bearable for clients , and increasing a consultation fee from $ 100 to $ 105 or $ 110 is barely noticeable .
One last consideration here is that if you list prices for products or services in more than one place , for example , on your website and on your waiting room desk , you need to ensure that they ’ re all saying the same thing because , where you advertise two different prices , the Australian Consumer Law dictates that you must charge a client the lesser of the two prices .
Finally , to return to the original question as to whether or not you should increase your fees , in an environment where you ’ re under the influence of constantly rising expenses due to inflation it would be potentially terminally damaging to your clinic , and your capacity to heal clients , not to do so .
206 | vol28 | no4 | JATMS