Price increase letter to customers: free generator

Fill in the date, the increase and the reason, and get a letter, a short email, a subject line and a text to copy, plus how many customers you can lose and still earn the same gross profit.

Free tool · Small business · Microsoft Word · Updated

1Fill in the price change

Your company and contact are remembered on this device only.
%

2Your letter, email and subject line

[today]

Dear valued customer,

Starting [date], prices for our products and services will go up by 5%. The raw materials we use cost more than they did.

Orders placed before [date] keep today's prices.

Thank you for your business. If you have any questions, please contact us at [phone or email].

Sincerely,

[Your name]
[Your company]

3Add old and new prices (optional)

4How many customers can you lose?

$
%

(Price − cost) ÷ price, before overhead.

Add your gross margin to see how many customers you can lose and still earn the same gross profit.

Want this done on your whole Microsoft Word? We fix price changes that have to reach every customer, price list and invoice at once on your real data, tested with you.

Walk us through your price change

What should a price increase letter to customers say?

Say what changes, when, why, and who to call, in that order.

  • What: the new price, the % increase or the surcharge
  • When: the date it starts
  • Why: one plain sentence on the reason
  • Who: a phone number or email for questions
  • Optional: orders placed before the date keep today’s price

Example: “Starting March 1, prices for our cleaning supplies will go up by 6%. New tariffs have raised what we pay our suppliers. Orders placed before March 1 keep today’s prices.”

How do you write a tariff letter to customers?

Name the tariff as the reason and say whether it is a price change or a separate surcharge.

A surcharge shows on its own invoice line and is easier to remove later. If it is temporary, give the date you will review it.

Example: “Starting March 1, we will add a temporary 4.00 dollar tariff surcharge to each order. We will review it by June 30.”

To work out the new price for each item, use the tariff price increase calculator.

How do you write a service price increase letter?

Give the old and new rate side by side for each service the customer buys.

Turn on the price table above and paste your services with today’s rate. The new rate is worked out from your %, or you can type it.

Example: a lawn service at 6% goes from 45 dollars to 47.70 dollars a visit. With whole-dollar rounding it becomes 48 dollars.

How do you word a price increase due to raw materials?

Say which costs went up, in one sentence, without figures you cannot back up.

  • “The raw materials we use cost more than they did.”
  • “Our steel and resin suppliers have raised their prices.”
  • “Fuel and delivery costs have gone up.”

Pick Raw materials as the reason and edit the sentence to name your own materials.

How does a price increase affect sales?

A price increase keeps the same gross profit as long as you lose fewer customers than this share:

Customers you can lose = increase % ÷ (gross margin % + increase %)

It assumes your cost per sale stays the same and customers who stay buy the same amount.

Example: a 32% gross margin and a 6% increase. 6 ÷ (32 + 6) = 15.8%. With 180 customers a month, you can lose 28 and earn the same gross profit.

A discount works the other way: customers you must add = discount % ÷ (gross margin % − discount %). A 10% discount on a 32% margin needs 45.5% more customers. To see which customers earn you the most, read our guide to gross profit by customer in QuickBooks Online.

Questions

How do I send a personal letter to every customer?

In Word, run a mail merge from an Excel list and swap [First name] for a merge field from Mailings > Insert Merge Field. The merge runs in the Word desktop app. In Mailchimp, pick the merge tag greeting and Mailchimp fills in each first name.

Can I send it from Gmail?

Gmail mail merge fills in @firstname from your contacts or a Google Sheet. It needs an eligible Google Workspace plan and sends to up to 1,500 people a day.

How much notice should I give?

Check your contracts and quotes first, since many set a notice period. The date field starts 30 days out, so change it to suit your terms.

Is what I type uploaded anywhere?

The letter is built in your browser. Your company name and contact are saved only on this device.

Sources

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