How to think about

“The consumer price index will rise 5.8% at the end of the fourth quarter from a year earlier…” –Olivia Rockeman and Kyungjin Yoo of Bloomberg

HOW TO ADJUST:

In order to combat inflation, you’ll need to first look at your operational expenses.

• If you drive to your clients, you need to take a look at how much more you’ve been spending on gas. 

• If your studio’s rent has increased, take that into account. 

• Think about EVERYTHING. Even the new price of the Gatorade you keep in your fridge!

Don’t raise your prices unreasonably.

• Raise them according to the new market value of your offerings. 

• Try and cut operational costs in other ways before adjusting your prices.

Clients will understand your business decisions if you are transparent with them. Explain that you’re not doing this because you want to, but because it is the proper thing to do at this time. 

If you don’t raise your prices commensurately with inflation, you’ll be giving your clients an unintended discount. 

👋  A good or service that used to cost $100 in 2018 will be worth $110.15 in 2022.