Entrepreneurs And Inflation: How To Handle It

Entrepreneurs and inflation: An unlikely duo but one we have to deal with in today’s world. Inflation is affecting us all in America, including regular employees, but it hits us small business owners harder. So how can we handle this? How am I handling inflation? Here’s a couple of tips.

Entrepreneurs And Inflation: You Have To Increase Prices Intelligently

When it comes to entrepreneurs and inflation the first way to handle it is to raise your prices intelligently. Many small businesses hate to increase their prices because they don’t want to scare off their customers. And rightfully so: Because they are dealing with higher prices from all the other shops and businesses. However, you as an entrepreneur cannot eat all the higher prices for your raw materials and services and other parts of your business. So how can you do this and keep a majority of your customer base? By raising your prices intelligently.

I recently had to raise shipping prices on some of my products in my online store because my vendors raised their shipping prices. What I did first was review the new charges and determine if I was going to pass along all of the new increases to my customers or only raise my shipping charges partially. After my reviewing I passed along all the shipping increases because doing a partial increase would hurt my business.

From there, I wrote a blog post explaining what’s going on and when the new shipping costs would go into effect. I also emailed this change to all of my newsletter subscribers so they know what’s going on too. That leads me to my final tip:

Entrepreneurs And Inflation: Be Honest With Your Customers

You must be honest with your customers about raising your prices. They want to know the truth because that will give them the ability to determine if they can continue to do business with you. Yes, you want to keep all of your customers but that’s not going to be possible. Some will leave because they can’t afford the increases. Others will stop buying from you because they don’t believe your product or service isn’t worth that much. When it comes to the latter case there’s little you can do about those customers.

Another reason to be honest with your customers about prices increases because they know what’s going on in the economy. I wrote in my blog post how I can’t eat shipping charges because it’s too detrimental to my business. Plus, I don’t make money off my shipping. I charge my customer exactly what it costs to ship their item or items.

Finally, when you’re honest with customers that increases your trustworthiness in their eyes. They will see you and your business in a better light and could be more likely to recommend your products or your services to others.

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