I raised prices by 40% after 3 years of undercharging. Lost a third of my clients. Revenue went up.
For three years I charged $75/hour because I was afraid of losing clients. Every time I thought about raising prices, I imagined the awkward conversation and chickened out.
Finally did it in January. Sent a simple email: "Starting March 1, my rate is $105/hour."
Lost 12 out of 38 clients within two months. Some sent passive-aggressive replies. One said "I hope the extra money is worth it."
But the 26 who stayed were my best clients. The ones who respected my work and paid on time. The 12 who left were the ones who complained the most and paid the slowest.
Revenue in Q1 at the old rate: $47K. Revenue in Q2 at the new rate with fewer clients: $54K. More money, fewer headaches, fewer hours worked.
The clients you lose when you raise prices are almost always the ones you should have fired anyway. The ones who stay become easier to work with because they've already decided you're worth it.
If you haven't raised your prices in over a year, you're probably subsidizing your worst clients with your best clients' patience.