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Knowing when to increase prices for a handmade skincare line can be tricky business.
Clearly, the main worry is that if you raise your prices, your loyal customers will stop buying from you and go somewhere else with a lower price tag.
But what if there was a way to increase the price of your skincare products without losing any sales or traffic?
In today’s post, you’re going to learn the PERFECT times to up those prices – and how to do it in a way that doesn’t alienate existing customers or cost more money than it makes.
I’m sure we all have that uncle or grandparent that reminds us of the prices of common goods and services years ago.
In 1930, the average cost of a new home was $3,845. The average annual salary was $1,970. A new car cost $600. Gas was ten cents a gallon. A loaf of bread was nine cents. One pound of hamburger meat was twelve cents. Source.
If a gas station kept those penny prices, they would literally be paying customers to fill up their tank. That’s true for any industry.
The prices to make and provide these goods went up over time, so businesses had to follow suit.
This is due to:
But as an entrepreneur, you want to raise prices beyond just ‘what is necessary’ to keep up with inflation.
You need to be staying ahead so that you can handle ingredient and shipping price changes while STILL being able to spend money on marketing, research, and new product development.
Staying two (or three) steps ahead is absolutely necessary for business growth.
To successfully increase the prices for your handmade skin care business, FIRST you must know exactly how much it costs to produce your products, additional transaction and e-commerce fees, and how you’re strategizing your profit margins.
Before you log in to your e-commerce platform and simply raise your prices by 10% (just like you did last year, eh?), you need to do your homework.
Go back and recalculate the base prices for ALL of your skincare products.
This should be on your calendar to do at least once per year.
During this exercise, you may find that the majority of your skin care ingredients have actually increased MORE than the 10% increase you were going to set.
Or perhaps one of your go-to vendors USED to offer free shipping but is no longer able to do so with the spike in oil prices, tariff rules, and border fees (costing you an extra $50+ per order!).
The point is that if you don’t go back and recalculate your base prices on a ROUTINE BASIS, you could easily be missing MAJOR increases in your own production cost.
Is it possible that a blanket 10% rise in rates won’t even cover your own annual business increases?
Absolutely.
These calculations aren’t the favorite task of most business owners, but the time it takes will save you hundreds to thousands of dollars every year.
You need to know where you’re starting in order to effectively increase the prices of your handmade skin care products.
If you haven’t increased the price of your products for more than twelve months, chances are they aren’t as competitively priced as they could be.
The price of raw materials goes up often, which means it’s time to increase your product prices too.
Shipping rates go up often (like the price of raw materials), it’s time to make a minor adjustment in your product prices.
It’s a good idea to do a quick Google search to see what other people selling similar products are selling for. This will give you an idea of the going rate and how your prices compare against competitors.
(Don’t necessarily stick with pricing the same way other makers do on Etsy – many of them are in the same questioning position as you are, not charging what they’re worth.)
It makes sense that if you want to stay competitive, it’s time for you to raise your own prices.
When you start making changes in the new year is a time we always recommend. It’s a great way to clean out the old stock before the new year and it’s a great way to start fresh and charge more for your products.
This is another perfect time to raise product prices. You get the opportunity to increase the value of your brand without increasing the cost, so it works out perfectly.
You can also raise your prices when you introduce new products. If you’ve changed up what you’re offering, it’s a great way to adjust pricing and make your new products more valuable in the eyes of your customers.
Product increases should only be done when you’ve got great things planned for your customers that will make them renew their subscription or buy from you again.
During this time, we recommend offering a loyalty program or free gifts to people who place an order so they feel like they get something extra in addition to the new improved product prices.
After a product increase, you should always offer your customers a discount code for their next purchase, to make them feel special and keep them shopping with you.
The right time to raise prices can be anytime!
We’ve talked about the most common times that it makes sense to raise prices but if none of those apply, don’t worry!
The perfect time to raise prices can be anytime, but you should always consider the following in order to avoid customer backlash.
First, offer customers a loyalty program or free gifts after raising your product price so they feel like they get something extra with their purchase.
Second, find ways that you can make your costumers’ experience more valuable through new benefits and features (such as discounts) when introducing any changes to pricing structure.
And lastly, before making any drastic adjustments in pricing for one of your products, do some research on how it compares against competitors’.
But also...no one wants to build a business by themselves! That’s doing it the hard way!
With the Skincare Business Branding Guide, you get step-by-step guidance to help you create the BEST branding for YOUR target market!
Christine Glaser, C.A.
Christine is a certified aromatherapist, essential oil specialist, and organic skin care formulator. She loves empowering others with tools to make healthy changes and understand where natural options can be woven into the fabric of everyday routines.
