Small business has to shoulder some difficult choices when it comes to staying afloat. Do you maintain the same quality of products and produce teamed with the same high level of service to meet the standards your customers expect of you, or do you turn to inferior products and produce in an effort to keep the costs down?

The café, Two Franks in Coburg Victoria decided that lowering their quality was not an option. They took great pride in their offerings and their customer-centric philosophy meant they didn’t want to sacrifice the standards their customers knew and loved.

The only other choice for them was to consider a price increase to ensure that their costs of running a business were covered and that there was a margin left for them to continue to run a profitable business. It’s a difficult decision to make for any small business.

So here’s a great way to approach it:

1. Clearly communicate your price changes openly and as early as possible.

   Once you have made the decision, then come up with a strategy to get this message out to your customers. Consider a social media post as Two Franks did, which was a clear and concise carousel post designed to engage with their customers while being transparent about the changes to the pricing. Explain the how’s and why’s and really try and humanise your business. You are not trying to rip people off, you are trying to stay afloat. Explain that you want to continue to supply superior products and produce because that is what your business supports and is the reason why your business is loved and respected. Keep it simple and be honest.

2. Offer something as a compromise

   Say your customers have a set budget for a meal or coffee, you have increased your prices to stay in business. Your customers will understand that and continue to support you but think about a way that you can also support the budget-based customers. Can you create a new product that will fit within their budget? In the case of Two Franks, they introduced a smaller sized coffee so people with a $5 coffee budget could still purchase a coffee without scrimping on quality.

3. Humanise the change

   There will be customers who challenge a change so when you can highlight your commitment to the community, quality produce, other small business owners and your own family. Create a connection so they understand this isn’t a money grab, it’s a small business wanting to continue to supply quality products and make a difference.

4. Justify the price increase

   Use the quality of the product to justify the price increase and provide a great service so there is no dip in your offering. If something is really, really good then we can justify spending a little bit more for it.

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