EP303 - Why Raising Your Prices Could Be The Fastest Way to Win More Clients with Ian Luckett and Stuart Warwick
The IT Experts PodcastShow Notes
In this episode of The IT Experts Podcast, Stuart Warwick joins me to talk about one of the topics that makes most MSP owners squirm in their seat, raising your prices. It sounds simple on paper and it gets an eye roll from almost everyone who hears it, yet putting your prices up is genuinely one of the fastest routes to a healthier, more profitable MSP.
We start by unpacking why raising your prices feels like such a psychological battle. Most MSP owners are scared their clients will leave, go out to tender, or feel hard done by. What we uncover is that the real block sits underneath that fear. Raising your prices is really about positioning yourself for value. Until you value your own business and translate that into the right pricing for what you deliver, no pricing conversation will land properly with your clients.
Stuart makes a point that stuck with me. Most MSPs have not touched pricing for their legacy clients in five, ten, even fifteen years. Costs keep moving, hardware, chips, licensing, inflation, yet the invoice stays the same. The starting point for raising your prices is always your numbers. Do you know your margins? Do you know what each client is actually costing you to service? Without that clarity, you cannot confidently or intelligently decide where prices need to move.
One story from the episode says it all. A client of ours had a base price of between fifteen and twenty pounds a user and genuinely believed they could not compete on anything higher. It took five years for them to shift that belief. Once they rebuilt their packaging, told the story properly to their existing base, and phased the change in gently, they added one hundred and eighty eight thousand pounds a year in additional profit. That is profit, not turnover, and it transformed everything from pensions to investment in new technology, eventually helping them toward a strong exit.
We also talk about the ninety percent problem. New clients are easy. You set your pricing, your margin looks healthy, and everyone is pleased. The real heavy lifting sits with your existing base, because the vast majority of your recurring revenue usually sits on legacy packages that have never caught up with the value you now deliver. Raising your prices for existing clients means selling a story, not simply issuing a new invoice. Explain what has changed, cybersecurity, cloud, automation, the modern tools you now provide, and frame the new pricing around the outcomes they get rather than the number itself.
Stuart shares a brilliant piece of thinking here too. If you have a sensible, well framed conversation with a client about raising your prices and they agree, you make more profit. If they say no and decide to leave, you also make more profit because you remove a client who was quietly costing you money. It genuinely is a win either way, and once you know your numbers, most MSPs can point to two or three noisy clients who are doing exactly that.
We close by talking about confidence and selling without selling. Nobody loves the idea of pushing products, yet raising your prices sits far more comfortably when you shift the framing from selling to helping a client buy. Know your numbers, build real belief in the value you deliver, tell the story with clarity, and bring your existing clients with you at a pace that respects the relationship you have built. Price condition new clients from day one so annual increases become an expected part of working with you rather than an awkward surprise years down the line.
Higher profits, stronger retention, and the confidence to invest in recruitment and marketing all start from the same place. Raising your prices properly, and believing you deserve to.
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