How to raise prices?

[franken]

I'm curious as to what would be the best way to suggest a raise in rates?  I'm starting out teaching and I'm not quite sure how to suggest such a thing as I increase in study and skill in teaching.  Any suggestions?

[leahcim]

Just add to whatever terms & conditions or policy document you have that you review rates once a year on whatever date, and then do that.

[lagin]

In February I'm raising my rate of $10.00 per half hour to $12.50.  (It's rather a big leap, but I started at 10 dollars when I was just beginning teaching and just starting grade nine piano.  Also, I skipped from grade six to grade nine, so I really only had the equivalent of a grade six piano exam.  Now I'm planning to do my grade 10 exam next June and start working on my performer's diploma right after, so it's a big leap in money, but also in my own experience and qualifications, if you want to call them that).  On a side note, if anyone feels it's too big a leap, please do let me know.  I've spoken to one of my parents so far and they think it's fair, but what do you guys think about the leap?

Anyway to answer the original question, when they pay me for the first semester this month, I tell them, "Just to give you some notice, I will be raising my rates to $12.50 in February - five months.  I just wanted to give you the heads up."  Then I explain why as I did above, so they understand the reason for the leap, as opposed to gradual increasing. 

I plan to leave my rates alone after that for the duration of the second semester of this year, through the summer, and through both semesters of next year, and the following summer.  Then in September of 2007 I'll probably put it up to $15.00 dollars per half hour.  (Don't know for sure yet, though, but leaning that way).  It should be my last leap.  At that time I plan to hopefully have my performers' ARCT, and be in the process of working towards my teacher's ARCT.  Which will be another big leap in money but also in experience.  I find that doing these two leaps gets me where I want to be without constantly raising my fee little by little all the time which I would think would get to be annoying.  When I raise it this second time, I'll explain that this should be the last "big" jump, and that when I increase it in the future it will only be a little at a time, .50 cents or a dollar. 

So in summary of this long winded post.  I always give them notice.  When it's a big leap, I explain why, and have a good reason.  I am very cordial and gracious, but also firm in my resolve, as this is my business.  You can also send a notice home, but from experience, some parents don't always read them, so it's better to do it in person.  This is new to me to, so if anyone wants to comment on how I've been doing it, please do!

[celticqt]

Good grief!  I'm not sure where you are from, lagin, but where I live $12.50/half hour is dirt cheap.  When I started teaching in this area, I called around to see what the going rates were, and priced below that.  Now I've been teaching here for three years, and my other teacher friends tell me I shouldn't be charging below $80 a month.  (Well, I am anyways.)

I did raise my rates this year, but I price by the month, not the week.  Leahcim's advice sounds good to me.

[franken]

Problem is, I feel this family is really trying to rip me off.  I may have just started teaching, but have been playing for 10 years.  I am offering them the special service of supervising their children practice and making sure they accomplish it.  Another point of all this is that I have to drive to their house and back, 30 minutes there, 30 back.  I told them that my original rates were 15.00 for an hour and 5.00 for gas each time I drive down there as a travel fee (I teach 3 different children each time I go down.).  When I told this to the father he felt my prices were incredibly unreasonable and suggest that by the time I meet with them for the first time maybe I'd think of a lower price.  Now I brought down my prices at first (Since this is one of my first clients) to 12.50 for an hour, 10.00 for 45 minutes, and 7.00 for half an hour, but still have the 5 dollar travel fee.  After going and supervising a few lessons my teacher (their teacher as well) is telling me that they almost want to adopt me now things are going so well.  I still can't help the feeling that I am getting ripped off here though, my time is very valuable to me as I am involved in so much this year as a senior, and I can't help but feel that because I am only 17 they think of me as inexperienced and don't treat me with the respect of a teacher.  What do I do?? 

[celticqt]

Hmm.  Well, there are a couple of things to consider.  The father is probably thinking that you are very young, so you probably haven't had any formal conservatory training.  Since you are new at this, they may be wondering if you are worth the money.  Your job is to show them that you are worth it (it sounds like you have a good head start on that).
 

I still can't help the feeling that I am getting ripped off here though, my time is very valuable to me as I am involved in so much this year as a senior, and I can't help but feel that because I am only 17 they think of me as inexperienced and don't treat me with the respect of a teacher.  What do I do?? 

You have to earn respect; it's not given freely, especially not when people's wallets are involved.  How badly do you want to be a piano teacher?  Is it worth giving up another activity so you have some down time?  Or are you just doing it for kicks?

After going and supervising a few lessons my teacher (their teacher as well) is telling me that they almost want to adopt me now things are going so well. 

Slightly confused here - aren't you the teacher?

[leahcim]

Look at it positively, when you started, mebbe you didn't have the confidence perhaps to say "Nah, it's $15, take it or leave it"?

But, you've got some money from it, and some experience too - and experience is worth more than $2.50 / hour.

It sounds like you're more confident about your teaching. So "ripped off"? Now perhaps, if you carry on in the situation, yes, but it sounds like you got something from the deal that you didn't have before - and from what your teacher has said, they are happy - hopefully happy enough to say to potential customers "Yeah, he's really good"

The problem is, they've got a teacher - and the father is paying for this supervisory role - in some sense he's justified to not pay you for teaching them because you've accepted a role that isn't teaching per se for $12.50.

So I'd say, if you feel the experience is still valuable and you don't feel you can afford to say "it's $15 or forget it" [with suitable polite language of course] then stick with it, unless you're really confident he'll accept the rise. The chances are he'll say "No" and you'll have to say "Ok, well I'm looking for my own pupils to teach now, so I won't be avilable for this supervisory role after <some notice period> - thank you very much...etc etc"

But don't burn bridges - for at least 2 reasons - one day they might get you back to do what your teacher does for them for whatever he charges and, as I said, if they are happy then the next person who says "Can I speak to some of your previous pupils?" you'll have someone who is happy to let them speak to.

But don't say "$15, no? Oh, ok..." you have to say the price and go with the decision they make - there's not much point haggling now you both know the scenario - he knows what he'll get for the money, you know what it entails.

But if you feel you can get a few pupils now and charge them $15 or $30 or whatever - do that and see the whole $12.50 thing as what gave you the experience / confidence to get there.

[classicarts]

I thought piano teachers do it for the love of music.

[abell88]

I thought piano teachers do it for the love of music.

Yes, and the little birdies bring us food...