Price Increase for Success.

How to increase your prices for next year without losing any guests!

Over the years, I have initiated and lead price increases in my own Spas and the Spas I oversaw and often this was not a fun activity. But a necessary one! What I have learned, is that it’s important to have a plan and not just to start somewhere.

Lots of work went certainly into your budget for next year. And this new budget has been created with some sort of price increase in mind, so NOW is the time to start acting and to put your budget vision into action. If I can give you one tip upfront: Do not wait until January 1st. You will lose precious days of the new year to start working towards achieving your Spa’s new budget. Let me share what has worked best over the years for the smoothest, hence most effective process.

Price Increase for Success

In order to achieve budgets for next year, you must start planning now! And I know price increases are something common, though often Spas fear that guests, especially loyal guests push back. Why do Spas have to increase prices? There are several reasons here two examples: costs increase for suppliers for their raw materials, so they increase their wholesale prices. Salaries are often increased by an annual inflation average which needs to be covered by an increase of treatment prices.

What is important when starting the process of increasing your prices, no matter if retail or spa treatment ones: you need a plan and strategy so this process is professional and gets the least push back possible.

Here a step-by-step guide on how to approach this process for retail price increase, so you are all set for January 1st:

  • Reach out to your vendors to understand if there will be a wholesale price increase for next year.

  • Print a list with all your products by vendor from your Spa software.

  • Make a plan and change prices manually on this list - some items you might increase (best-sellers and products that got a wholesale price increase), some decrease (slow sellers) and some keep the same.

  • Inform your team of the upcoming process to avoid frustration and it will allow them to be mindful when they communicate on retail prices they may know by heart to your guests.

  • Work through the process and your Spa Boutique brand by brand. Involve your assistant managers and supervisors as this offers an important learning opportunity for them.

  • Update the prices in your Spa software and print new price tags to put on the products immediately in order to avoid any guest complaints.

  • Update any price lists that may exist.

For treatment price changes you want to follow these steps:

  • Print a list with all treatments from your Spa software. Make a plan and change prices manually on this list based on price increase and salary increases. Calculate how much you need to increase which treatments.

  • Inform your team! Especially all team members taking reservations to avoid glitches.

  • Prepare a list with all areas where you need to change the prices. From experience I suggest to go category by category. Here some areas:

    • Spa Menu - printed ones or PDF - anticipate this change if you need assistance from your marketing team, a printer, etc. Make sure this is ready for when you update the prices in your Spa software.

    • Website - this often has to be done through your PR department. This process may take some days to update so it is worth submitting this a few days out before you do the actual change in your Spa software.

    • In-Room collateral - discuss its update with your marketing and rooms team.

    • Spa Software - I suggest to go category by category. Usually Spa software asks if prices for existing, future bookings should be affected which you don’t want since you confirmed the previous rate to your guests upon their reservation.

    • Online Booking - often Spa software does not update automatically the online booking treatments. It is always worth checking !

    • Send an email to all hotel departments with new price list. Often we forgot who is sharing information with guests asking for a Spa Menu like restaurants, concierge, etc.

    • Update pre-set email templates with new rate sheets.

  • From experience, if you raise treatment prices between $5 - $15, even regular clients usually don’t push back as said before, price increases are something very common. But if you know that your most loyal customers can be rate resistant, call them up front or meet with them. Tell them about the upcoming rate increase. Based on their reaction, offer them graciously to keep the previous rate for 1 or 2 months.

  • And provide your team with verbiage so they feel strong and ready when a guest looks at them with a question mark in their eyes. Often a confident answer like “Yes, you are correct, there was a price change and these are our 2022 rates” will turn a ‘?’ into a ‘!’.

Agreed, this is quite a process! You need to set some time aside - my team and I preferred to do this after hours which allowed us to be less interrupted and the reservation team had no change of prices within their shifts but in between shifts. One thing though is for sure, the new year is close so my tip, get the process started today!!

If you are already a pro, I would love to hear if you have created any best practices over the years that makes this process of changing prices more efficient! Share with us below in the comments.

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