Raising Prices in your Clinical Research Consulting Business

At some point while running your clinical research consulting business you will need to raise your prices.

Even just to keep up with inflation, you should raise your prices periodically. But you should also consider doing a yearly review at a minimum-quarterly is better-to decide if you should raise your prices.

You may be wondering "How do I know if I should raise my prices?" Or, "How do I go about raising my prices?"

In this article we will explore detailed answers to these questions.

When to Raise Prices 💵

Put simply, you should raise your prices when you are not billing the full amount of the value that you offer.

The trick is to know when your billings and how much your clients value the problem that you solve are not in alignment.

Workload 💼

One way to spot a misalignment is when you have more work to do then you have time to complete!

If you are so overwhelmed with work and have a backlog of projects, it is time to raise prices. Not only will this clear your backlog, and the associated stress, but your clinical research consulting business will make more money for the same amount of work.

Client Feedback 💬

Sometimes clients themselves may let you know that you are not charging your full value, if you pay attention.

Have you ever heard a client say "That is less than I thought" or "I would pay you x more for that!" If so, it is time to raise prices.

Increasing your Value 🏆

If you have improved your skills or the service that you offer, it might be a good time to raise prices.

This would only apply if your level up adds additional value to your clients, and improves upon how you solve their problem. An of example of this would be completing a CPA designation, which increases the value you offer clients compared to without it.

How Much to Raise Prices 📈

Answering this question again boils down to knowing the value you bring your clients by solving their problem.

If you are doing accounting, but don't have a CPA, then you shouldn't try raising your fees to what a CPA would charge. You wouldn't add the same value.

Know your value, and bill as close to it as you can.

Making Large Increases ⬆️

You might be worried that if your increase is too large, all your current clients may flee.

Certainly, there is a level at which this would happen. But if you don't overshoot the value you offer, the likelihood that all your clients will abandon you is very low. New clients likely also won't know what your prices were previously.

But there are some caveats to this.

1. Sometimes budgets are set well in advance. You need to take this into account for existing clients. They have probably already factored your costs into their budgets and can't make changes until the new budget.
2. Not all clients will value the problem you solve the same. You may lose clients who undervalue your services. This is ok. You should only want to work with clients who value your services appropriately. It is better for the longevity of your clinical research consulting business.
3. Clients need fair warning. The larger the increase, the more time you should give your existing clients between notice and the increase. A general rule of thumb would be sending notices out 2 months before the price increase. This is a professional courtesy. But your type of clinical research consulting business will dictate how much notice to give.

Here are some example from my business:

• I do a biyearly review of my projects fees and adjust as needed.
• The largest increase I have even done was to double my hourly rate (when I was just starting out-and still billing by the hour). No clients abandoned me.

How to Raise Prices 🗒️

It can seem pretty daunting to tell existing clients that your prices are increasing.

Relax. Price increases are a normal part of business. Good clients will understand this, so long as you are still offering significant value for the cost.

Here is an example of an email letting a client know about the price increase:

Hi John Doe,

Starting on this date (2 months from now) service xyz will be $x.

I appreciate your business and look forward to continuing working together.

Please let me know if you have any questions.

Regards,
You

Let's discuss some highlights in this example.

Don't Ask Permission 👍

The first thing you might notice is that the price increase is not a negotiation, and there is no asking for permission.

It can be hard for clinical research consultants just starting out, but remember that you are not an employee. You are running a business. You don't need to ask your clients for a raise, you tell them what your pricing is. They can then decide if they value your services enough to pay the new price.

Justification 👨‍⚖️

The second thing you might notice in the example above is there is no justification.

For reasonable increases you shouldn't need justification. When your cellphone bill increase $5 dollars every few months are you given justification? Though you would certainly raise a stink if this monthly bill doubled!

If the price increase does need a justification, make sure it is reasonable and professional.

Reasons like inflation or costs are up may be true, but that is not your client's problem. What they care about is the value they get for the amount of money they spend.

Instead, let your clients know about how your value has increased. "I am now guaranteeing 2 business day turnaround of written articles." This adds more value and justifies an increased price.

Start Date 📅

Give your clients ample warning of any price increases.

The time frame can be specific to your business or your client's budget cycles, but a good place to start is 2 months notice. This is a professional courtesy. No one likes to be blindsided and have to scramble to allocate the necessary funds on short notice.

Summary

This article has reviewed answers to common questions about raising prices. If you found this information useful please reach out and let me know. I'd also love to hear your story about how your recent price increase went.

If you found the information here useful, let me know. I would also love to hear about any of your strategies for earning referrals and repeat client. Get in touch!