Raising a price: whom, when, how much

Raising a price starts with two different numbers. The target is where the price should end up: for Dana, about 960 UAH a lesson, because that would match what an hour at Klasna pays her. The next step is the price you move to now.

A jump from 600 to 960 is +60% at once, asked of people who chose her at 600. Nothing she has seen so far says buyers accept 960; her small spring quote only showed that 750 meets no wall. So the sound move is a step she can explain and observe: 750 for new learners, then see how buyers respond before the next one.

Steps also keep the conversation honest. "My lessons now cost 750" is easy to explain; a 60% jump invites people to compare and leave, and leaves her no evidence about where the real limit is.

A higher price means more money per sale and, often, a few fewer sales. Before raising, work out the break-even volume: how many sales at the new price earn the same as today.

For Dana, start from what she keeps. As a FOP she pays the single tax and the military levy, 6% of income, so she keeps 94%: 564 UAH a lesson at 600, 705 at 750. Her tools cost 7,200 a year whatever she teaches. This year's plan, 348 paid lessons at 600, nets 189,072.

At 750 she needs (189,072 + 7,200) / 705 = 278.4…, so 279 lessons. The general method, how much volume a price change can lose, is in the course Finance for Product People; for one tutor it fits in a line.

Compare the answer with what you know. With a waitlist of four, losing that many lessons is unlikely.

The break-even volume becomes a decision tool when you turn it into a share: how much of today's volume could go before the rise stops paying?

Dana plans 348 lessons at 600; 279 at 750 bring the same net. She could lose 69 lessons, 19.83%, almost one lesson in five, and earn the same. And each lesson she doesn't teach frees about an hour and a half of her time, including preparation, so about a hundred hours a year.

Now hold that margin against the evidence. A full calendar, a waitlist of four and four of six new enquiries accepting 750 all suggest she will lose far fewer than one in five. When the safety margin is wide and the demand signals are strong, a step up carries little risk. When the margin is thin, the step should be smaller or tested first.

A price rise doesn't have to reach everyone on the same day. New buyers can get the new price at once: they compare it with alternatives, not with what they paid before. Existing customers chose you at the old price, so they get notice and, often, a smaller step.

Dana's plan: new learners pay 750 from 1 May, which is what she already quotes. Everyone who started at 600, and the four people on her waitlist whom she promised 600, keep it until September. A promise is part of the price: breaking it costs more trust than the extra 150 is worth. From 1 September existing learners move to 700, a thank-you for the year, told personally on 1 June.

What doesn't work: a jump for everyone tomorrow, or 600 forever for existing learners, which keeps her far below her target and leaves two prices to explain every year.

People feel a price rise as a share of what they pay now, so measure each step in percent: (new − old) ÷ old.

For Dana's two groups:

• new learners: 600 → 750, (750 − 600) / 600 = +25%;
• existing learners: 600 → 700, (700 − 600) / 600 = +16.67%.

The smaller step is the thank-you to people who have been with her all year, and it still moves her toward her target: what she keeps per lesson rises from 564 to 658.

Check the base. The percentage is always taken from the old price. "100 is 14.29% of 700" is a different question and makes the rise look smaller than it is. When you explain a rise, give the new price and the date; when you plan it, look at the percentage, because that's what the buyer will notice.

How a price rise reaches people shapes how it lands. Existing customers should hear it first, personally and early, not discover it in a public post.

For a one-person practice that means a short message to each learner, sent before anything goes to the channel. Dana sends hers on 1 June for a change on 1 September: three months of notice that fall just before the summer pause, a natural moment to decide whether to continue.

Keep the tone plain. A long apology suggests the rise is wrong; a discount attached "to soften it" blurs the new price before it starts, and the smaller step for existing learners already is the thank-you. Talking about money with people you like is uncomfortable, but a clear, early, personal message is the kind thing to do: it gives them time and treats them as adults.

A good price-increase notice is short and complete. It answers what the reader will ask, in this order:

1. What changes, from when and by how much: "from 1 September a lesson costs 700 instead of 600".
2. The real reason, in one sentence: what goes into each lesson and what the time is worth.
3. What stays the same: the length, the format, the slot.
4. Their options: keep going, switch to fewer lessons a month, or stop with no penalty.
5. Thanks for the time together.

Two things don't belong. A reason that isn't true, such as "inflation" when her costs barely moved, is a false statement, and anyone who checks stops believing the rest. A countdown, "decide in 24 hours or lose your slot", is false urgency and contradicts the three months of notice she is giving.

A disguised price rise keeps the price and quietly gives less: a shorter lesson, a smaller pack, a feature taken out. It is still a rise, measured per unit of what the buyer gets.

Nazar's idea of 50-minute lessons at 600 is exactly that: 600 / 50 = 12 UAH a minute instead of 600 / 60 = 10, +20% per minute, without a word. Most people may not notice at first. The ones who do feel tricked, and from then on they doubt everything else she says, including the next honest price.

The open rise is both fairer and easier to defend: same lesson, new price, notice, a reason and options. Keep the product as it is and change the number in plain sight.

How it fits together: a step toward the target, sized by what the rise can afford to lose, new buyers first, existing ones later with notice and a clear, honest message. The next lesson moves to Klasna: raising prices when costs move with inflation and the hryvnia, and answering a rival's cut.