https://www.youtube.com/watch?v=Gy-RmpRif-I

1 00:00:00.000 --\> 00:01:00.000 what's going on everyone in this video
i'm going to show you how to raise your prices in a tactical way on your
existing customers so it's one thing to raise your prices on new
customers which for many times you know that's something that you have
to do uh because you need to you know you want to reinvest in making the
business better you want to cover some capital expenses or you just want
to make more money which is fine and the number one lever on making
money is what you're pricing at right we've done this in thousands of
businesses now and there's a process that we go about this because if
you raise it on existing customers be ready to have people be upset but
here's why this is so important so let's say that your business runs at
a twenty percent net margin which is fine right and let's say that you
just for number sake you charge a hundred dollars a month if you're
running a twenty percent net margin and you're 100 a month a 20 increase
in pricing would double your profit a 50 increase in pricing with three
and a half extra profit that's pretty good if you doubled your price you
would 6x how much money you make and so this is how big of a lever
pricing is on how much profit you make and so knowing how to raise your
prices obviously would be something that would

2 00:01:00.000 --\> 00:02:00.000 be very important so there is a right
way and a wrong way to do it so what i want to do is show you the right
way because the wrong way to do is send an email out saying hey we're
raising our prices you know screw you um and you'll get a ton of
customers who leave you and then you'll end up being worse off than you
were before but i did this in my facility this is one of my first
businesses and i actually had a third of my customers cancel but i
tripled my price and so i was able to keep two thirds of my customers at
three times the price and lose one third of my biggest my employees
called it the culling we got rid of all the problem customers in one
fell swoop so if you have a pain a bunch of customers were always
complaining about stuff you might want to do this because you'll get rid
of all the cancerous people and keep only the people who love you and
when i did that i doubled my revenue and here's what's even cooler my
profit went through the roof because i even had to service a third fewer
customers which was awesome all right and so the way that we do this is
uh through a price increase letter and if you're curious um my gymloc
secrets book is a book that is about gyms but is a business book that is
simply applied to gyms if you want it you can grab it it is not how i
make money um but let's

3 00:02:00.000 --\> 00:03:00.000 say let's let's walk through this so
you have your letter to increase prices right now there's a format to
doing this all right now it's not about you it's about the prospect it's
about the consumer all right so the first thing that we want to do right
is you know we're gonna say hey you've probably known that we've been
you know growing a lot you've probably noticed a lot of the the good
things that are going on right now um and so that's why i'm writing this
letter all right so it's like why am i doing this why am i writing this
letter to you what's the intention the letter all right the second is
we're going to talk about what we currently are doing all right and so
this is allowing you to re resell them a little bit on what you're
currently doing the value you're currently providing them because
sometimes they forget because they might only use one aspect of your
service and so if they're like oh wow there's a lot of extra stuff that
i didn't even know about and believe me i can't even tell you the amount
of times people read this letter and they're like i didn't even know you
were doing all this stuff right and so you want to list out you know the
stuff that you're doing and say okay you know we hire and retain the
best talent you know we have we offer continued education for our
employees we you know we we're providing new uh softwares and equipment
uh to our members that that we always

4 00:03:00.000 --\> 00:04:00.000 try and keep up to date that's what
we're currently doing they're like oh i didn't even think about that so
the goal here is to is to get them to think about your costs try and get
them into the mind of you as an entrepreneur to the best of your you
know ability right like these are the things that we incur in order to
provide this value it's not like we're just taking all the money you
give us and putting it in our pockets because that's what everyone
always thinks all right the next thing we do is we say wow despite all
the stuff that we're doing we want to do even more because we're losing
our minds because we just provide crazy value all right and so it's like
we want to um like you know we're currently a ragtag bunch of champions
our our our facility if you have an actual facility and if you're online
it's like you know we've got a lot of stuff that's duct taped together
we want to really uh you know level up the brand and we want to do it
for you right so you want to tell them what's coming so this is like we
want to add these x y and z things we want to add specialty programs we
can add higher levels of service we want to add you know events to our
to our business we want to add all these things right a massive
improvement to our level of service these are all things that we want to
be

5 00:04:00.000 --\> 00:05:00.000 adding right and then what i like to do
is i like to tie this tie this increase to a promise of values okay now
what i mean by that is i want to tie this to values that i ascribe to
that no one can contest so i can say i have made this promise to you and
with integrity i can no longer provide the level of service uh that i
have promised unless we do these things because i will not stand here in
this marketplace and say that we are the best at xyz unless we do these
things and the only way for me to do these things is for us to have a
corresponding increase in price all right now mind you when you're
communicating the price it's also important to communicate the price in
a way that's you know attractive so you want to say hey it's going to
cost you five thousand dollars extra a year you would say it'd be better
to say uh it's going to cost you an extra 100 bucks a week right sounds
like a lot less right you could even break down even more and say it's
15 bucks a day it depends on you know who we're talking to and what
level of service you have but you can break it down to weekly or break
it down to daily and that's why insurance quotes people in days it's
only a dollar a day right

6 00:05:00.000 --\> 00:06:00.000 um so that you can do this and it will
minimize what the perceived cost is so ideally you want to maximize by
saying this is all the stuff we're doing that we you didn't even know
about this is the stuff we want to do that's even more than that and
this is how little it's going to cost you and the reason we must do this
is so that i can maintain my integrity to you and the promise that i've
made you i'm fervid that this is something i'm planning my flag here is
that i demand to be the best in the marketplace and for us to do this we
must continually invest and for us to do that like this is what is
required right and then and here's what's cool is that i like to add a
little ps at the end and that little ps is to give perspective all right
and what i do here is i say if this is going to materially affect your
life if you're not going to be able to pay your mortgage you're not
going to be able to buy groceries for your kids please reach out to me
um and we can figure something out and so by saying that you
automatically perspective to everyone that listen no one's gonna go
homeless over this thing right no one's gonna lose their house because
we're raising the price of our xyz right right but we open the door for
discussion for the people who feel obligated or feel

7 00:06:00.000 --\> 00:07:00.000 the need to do this now if you make an
announcement like this which i recommend you doing via video and via
direct mail you want to make it and then also turn the comments off on
whatever the post is because believe me you don't want to deal with that
as you just say hey i don't want this to be you know a gossip form if
you have anything just bring it through me directly out of respect for
you i want to deal with these you know face to face and not over the
keyboard right and so it's an easier way to also manage and mitigate any
kind of negativity that happens and believe me if you raise your prices
you're going to have people who are going to be squeaky wheels and it's
in their best interest to get you to not raise the prices so just don't
chicken out once you commit to it stick with it all right because i'm
telling you if you raise your price like i just told you if you have a
25 margin and you raise your price by 25 you double your profit all
right so i told you i lost a third of my customers but that's because i
tripled my price and most businesses don't realize how much of a pain it
is to find another one of your business and so if you can capitalize on
that and you can usually eke out an increase in in revenue and profit as
a result you will be far out rewarded by making

8 00:07:00.000 --\> 00:08:00.000 that change and the people who do leave
are usually your worst customers and you've been wanting to get rid of
them anyways and this gives you a great time to do it so if you're going
to raise your prices this is the way that i do it to existing customers
i write a letter i tell them you know why i'm set i'm setting the stage
for why we're doing this i tell them all the things that we're currently
doing that they don't know that we're doing and you probably do tons of
stuff it's good to list the stuff out then you tell them about the
future of what's going to happen what the benefits are going to be to
them to what they're about to enjoy and how that's going to impact them
in a real way in every single time they see you they experience your
business they interact with you and what benefit of the benefit is going
to occur and then finally i like to end with values and perspective all
right so probably values are right here so values is kind of the wrap up
so just consider that 3.5 sorry 3.5 right and then you have your wrap up
which is hey big picture this isn't going to make you or break you
you're not going to go homeless because of this but if you do have
something that's going to materially affect you because you have that
anchor it makes it very easy for you to have that discussion right and
so if you have to raise your prices this is how i recommend doing it

9 00:08:00.000 --\> 00:09:00.000 i actually have the exact letter that
we send out for for gyms in my book if you want to grab it you can i
promise you it's not how i make my dollars but you can get that alex's
book.com if you're curious otherwise keep being amazing um keep being
awesome i made this channel so that uh a lot of people are broke and i
don't want you to be one of them that's why i made this so keep being
awesome i'll see you guys on flipside bye
