How to price your services (and raise prices without losing clients)

Start from what an hour must earn

Begin with your costs, not your competitors. Add up what the business needs each month: rent or chair rental, products, insurance, software, marketing, taxes you set aside and the salary you want to take home. Then count how many hours you can realistically sell in a month, which is far fewer than the hours you are open.

Divide the first number by the second and you have the minimum an hour of sold time must earn. Everything below that line is a hobby that costs you money. It is uncomfortable to see, but it is also freeing, because the price stops being a feeling and becomes arithmetic.

Be generous when you estimate costs, and be strict when you estimate sold hours. Most owners overestimate how much of their week is bookable. If you are unsure, track your real hours for two or three weeks, including the slow moments, and use that figure instead of a guess.

A worked example, with made-up numbers

Take a purely illustrative studio. Say monthly costs and the income you want add up to 12,000 ₪. You work five days a week, but after admin, cleaning, cancellations and gaps you actually sell about 80 hours a month. That means each sold hour needs to bring in 150 ₪ just to meet the target.

Now translate that into services. A 60-minute service should cost at least 150 ₪ plus its own materials. A 30-minute service is 75 ₪ plus materials, and a 90-minute service is 225 ₪ plus materials. These are example figures only; use your own costs and your own sold hours, and revisit them whenever something big changes.

• Monthly costs plus the take-home pay you want
• Sold hours per month, not opening hours
• Cost divided by sold hours gives the minimum hourly rate
• Add the materials each service uses

What to include in the price

Many owners forget the time around the service. The consultation, the cleaning, the notes, the message to confirm and the product you replace are all part of the work. If the price covers only the minutes the client sees, you quietly donate the rest of your day.

Also remember the costs that do not appear every week: training, tools that wear out, a holiday fund, a slow month. A price that only works when everything goes perfectly is too low. Give yourself a little room so one cancelled day does not become a worry.

Do not forget the cost of your own mistakes and goodwill: the redo you do for free, the client who runs 20 minutes late and the product that spoils. A small allowance in your price covers these quietly, so you never have to resent them in the moment.

Compare locally without copying

It is useful to know what other providers nearby charge, because clients do compare. Look at studios that offer a similar quality, location and experience, not only at the cheapest ones. A short look at three or four prices is enough; you do not need a spreadsheet.

Then ask what makes you different. Maybe you are faster, more specialised, quieter, closer to the station or better with nervous clients. Those reasons support a higher price. Copying someone else’s number without knowing their costs is risky, because you may be matching a price that is already losing them money.

Prices also tell a story about quality. Being the cheapest option in the area can attract clients who leave for the next discount, while a fair, steady price tends to attract people who value the work. Decide which story you want to tell.

How to announce a price rise

Tell clients early and plainly. A message a few weeks before the change is fair: it explains that prices are going up on a certain date, thanks them for their trust and says what will stay the same. You do not need a long apology or a list of reasons. A calm, short note sounds more confident than an anxious essay.

Update your booking page, social profiles and any printed price list on the same day. If someone has already booked a future appointment at the old price, you decide whether to honour it. Most owners do, because it is simple and it feels fair.

If a client reacts badly, stay calm and kind. Thank them for telling you, repeat the new price once and avoid negotiating on the spot. Some people will need a moment, and a friendly tone keeps the door open for them to return when they are ready.

Grandfathering and rounding

Some owners keep a loyal client’s old price for a set period, such as a few months, as a thank-you. It is a kind gesture, but give it an end date so it does not become permanent by accident. Say it once, clearly, and then follow it.

Rounding makes life easier too. A price like 187 ₪ is awkward to say and to pay, while 190 ₪ or 180 ₪ is clean. Round in whichever direction your calculation supports, and keep your menu to a few steady price points so clients can remember them. Simple prices also make it easier to spot mistakes when you issue a receipt.

Write down any promise you make, such as “your current price until the end of March”, so you remember it later. Clear dates protect both sides and prevent awkward conversations months afterwards.

Review twice a year

Put two reminders in your calendar, perhaps in January and in summer, to look at your prices. Check whether your costs have changed, whether your most popular services are fully booked and whether any service takes much longer than its price suggests. A service that is always fully booked is a sign that you can charge a bit more.

Small, regular adjustments are easier on clients than a big jump after years of silence. If you keep an eye on your numbers, a rise becomes a normal part of running a business. Lumea’s free plan keeps your services and their durations in one place, which makes this review quicker. Your own judgement still does the real work.