[00:00:00] Fi Johnston
This episode is for any business owner who wants to start charging premium prices, but they're used to charging a much lower amount. What do you do in the transition time between the old clients and the new? This is something that actually comes up so often and it's something that a lot of business owners get really stuck on. It's probably going to be easier than you expect it will be when you have the right. Strategy.
Intro
But if we want to be able to tip the scales towards the favor of marginalized people, we need to understand the secrets to making money in small business. The more we talk about money and the secrets that usually stay at the golf club, the more likely we are to be able to make money.
My mission is to get more money into the hands of. Good people, specifically good business people like you. This is Money Secrets, the place to learn about the money, secrets of successful small business owners. Let's go. [00:01:00]
Acknowledgement of Country
This podcast episode was recorded on the lands of the Wie people of the KU Nation, and I'd like to acknowledge them as the traditional owners and custodians of this land and water that I live, work, and play on. I'd like to pay respects to elders both past and present, and note that sovereignty has never been seeded. This always was and always will be. Aboriginal and Torres Strait Islander land.
I am Fee Johnston. I'm the host of the Money Secrets podcast. I'm also a chartered accountant, the founder of Peach Business, good Money Club, and the co-founder of Ripple Festival.
By the way, you should come. It's happening in November, 2025 in Melbourne. So you might be a product or a service-based business owner, and maybe from a previous episode that you've listened to or from somewhere else, you've made the decision that, yes, I do want to increase my prices. And you've probably [00:02:00] worked out that one of the best ways to increase your prices is by working with a different type of client and that different type of client is now going to be your ideal client.
The reason they're your ideal client is because they are looking for the kind of value that you have to offer, and they're able to leverage the value that you are able to create. So they have the budget, they have the desire, or they have a problem that you can solve, that they are looking to invest a premium amount of money in.
This is going to mean that your marketing needs to change because marketing is most effective when it names and calls out the exact client that you want to work with. You are going to increase your prices, which means you need to do a better job of your marketing and your comms. You need to get really good at explaining and expressing the value, the [00:03:00] transformation, the outcome.
The benefits of working with you or investing in your product. So once this all starts to work, you are going to start attracting premium clients willing to pay premium prices into your business. But what do you do in the transition time between the old clients and the new? This is something that actually comes up so often and it's something that a lot of business owners get really stuck on now.
It is possible to increase your prices, and it's probably going to be easier than you expect it will be when you have the right strategy. When we're in that transition period between the old and the new, we need a strategy for that too, so that we can actually work our way through the messy middle. So what we're talking about here is that you have legacy clients or existing clients who are either already paying a particular [00:04:00] price or they're used to paying a particular price for your product or service.
What you are doing is you are actually working away behind the scenes on marketing to a more premium client that's looking for the amount of value that you are wanting to deliver. Maybe you are also looking to. Improve your products and services during this time. Maybe you've realized that there is actually more that you could be doing.
There could be a higher value transformation. There could be more benefits or different features or special inclusions, more customization, whatever it is that's going to allow you to charge a premium price to this new client. That's what you're working on. So your marketing is now working more effectively.
You are working towards bringing these higher paying clients in, but we've still gotta think about what to do with your legacy clients. So here's my advice. [00:05:00]
Good Money Club Ad
Are you a woman in business who wants to make more money and impact through your small business? Good money club could be for you. In Good Money Club, we have no more than 45 members and in the community we are working on making and managing more money.
The doors to the club are open right now and they close on Sunday, the 5th of October, 2025. We won't be opening the doors again until next year, so if you are keen to join, the time is now.
In my experience, it's really hard to get a client paying a certain price to move to a completely different bracket. It's possible to move your legacy clients up maybe 10 to 20% per year at the absolute most, unless you have an amazing way of marketing. Or you have great reputation or you've really built something special.
With those legacy or existing [00:06:00] clients, it is really difficult to increase the price more than 10 or 20% a year. But with a new client, you get to charge any price you want to as long as you are able to explain and then deliver the value that equates to this new price that you are looking to charge. So what you might consider doing is looking to increase the prices of your existing clients to the limit that you think you can.
And in the interim, you are starting to bring in premium clients paying higher prices. And what will happen is as those premium clients start to come into your business, it will mean that you can let go of some of those legacy clients. One way of doing it is to put the price up for those legacy clients a little bit each year until you have enough premium clients that you can actually let those older clients go.
This works really well for service providers, especially when you have [00:07:00] retainers in place. Another strategy can be to really back yourself, go to the existing or legacy clients and put in a really significant price rise. You might give them one or two or three months notice giving you that little time to work through bringing your more premium clients in.
What you'll find is some of those legacy clients might actually stay at the new price and a lot of them will drop off. That is the biggest fear that we have as business owners, is that we will lose our legacy clients. But if we are replacing those legacy clients with higher pain, higher value seeking.
More premium clients, we're actually still gonna be in a better position at the end. This is a really simple concept that I'm explaining here, but it actually comes with quite a lot of mental gymnastics that we have to do to try to work out how to get our mind around this idea of [00:08:00] transitioning between legacy or grandfathered clients, moving to a more premium client mix.
So one thing that you can do is try to increase the price to your existing clients of 10 to 20% per year until you get to a point where there's enough premium clients that you can let some of them drop off. Or you can start with a really significant price rise to your existing or grandfathered clients.
With a bit of a timeframe, so one, two, or three months kind of lead up and that gives you one, two, or three months to start bringing in those more premium clients into your business. A third strategy can actually be to wait until you have three months of operating expenses and wages saved in your business.
Giving you three months to let go of the old clients and spend those three months working on your marketing, your branding, your communication, and your price. So that then at the [00:09:00] end of the three months when you've actually used up all of the savings that you had put aside for this particular strategy, and now you are ready to go with the premium clients that you now have in your portfolio.
So are you somebody who's really scared to put your prices up because you don't know how? You're going to deal with your legacy or existing clients. I really hope this episode has given you a new perspective on how you could either keep some of those existing clients, let all of them go, or do a little bit of a transition between the older clients paying lower prices and your new premium ideal clients that are coming into your business.
Let me know how you go. I'd love to hear what you think about this strategy. Thank you so much for listening right up to the end. I hope you enjoyed this episode of Money Secrets, where we talk about the money secrets of successful small business owners. If you [00:10:00] enjoyed the episode, I'd love it if you subscribe to the podcast, but leave us a review or share this episode with one of your friends.
I hope you learned something. I hope you got a new perspective and I really hope you enjoyed the listening experience.
