Price Increase Letters & How To Inform Your Clients Professionally

A price increase letter is a formal communication that informs customers about price changes. This decision can be taken for many reasons, such as inflation, increased investment in R&D, etc. Besides, increasing the price can be 🔗a brilliant marketing move to show the value of your competitive products or services. However, no client would be happy to see the price rise until they receive a reasonable explanation. And the most classic but effective way to deliver this announcement is to send a well-written increasing price letter to inform customers.

This article will provide tips on how to write a professional price increase letter and common reasons to raise prices you can use. Furthermore, we also provide free letters with an editable version you can use to create this document in just 3 easy steps:

  1. Select a price increase letter template for your need.
  2. Fill in your information by answering a few quick questions.
  3. Review and complete to download your letter in a business format. You can always make changes or edit text freely to meet your requirements at any time. Let’s get started!
Visit Our Price Increase Letter templates background cost increase

What are common reasons to state in your increase price letter?

  1. Increase In Material Costs: Perhaps the most common reason to increase prices is to bear the increased costs of raw materials due to inflation. Every company needs profit to maintain the service and operation. Therefore, a company can not continue selling the products at the same low price if it hurts its finances. Then, increasing cost is inevitable. 
  2. Increase in production and distribution expenses: Inflation affects all industries, including production and distribution. You’ll have to increase your prices if it costs more to produce and distribute your products or the materials needed to make and maintain their quality. Likewise, changing a new supplier for materials or changing processes affects the product’s quality, which must be considered carefully. 
  3. Increase in quality and service: Remembering your customers that higher prices mean better quality is crucial. If you focus on value, your strategy is to give customers better quality and service over maintaining low prices. Suppose many competitors are offering similar products at lower prices than yours. In that case, improving your product’s value might make sense so that customers stay loyal and choose them over competitors’ offerings. Then, we will need to invest in R&D, which means increased costs.
  4. Increase labor cost: Another way to justify price changes is by improving employee wages. It can help motivate workers who feel underpaid compared to their peers at other companies within their industry. Another example is if you’ve increased job satisfaction by adding benefits like bonuses based on performance metrics, it will likely lead to higher employee retention rates. It leads to increased operational expenses down the line due to improved performance. It is reasonable, and customers are more likely to accept this reason also.

How do you write a price increase letter?

We will divide this letter into three main paragraphs to understand better what we should write in the increase price letter. You can also look at our price increase letter example at the end of this article for your quick reference.

How to write a short sample letter to inform customers of price increase

1. The first paragraph of the rate increase letter

In the first line of the open letter, you should acknowledge the customer and thank them for business in the past. By doing so, you are politely showing your customers appreciation for their support of your products. Then, the following state the reason for the price increase. As a rule, it’s best to be specific and honest about why a price increase is needed. Customers appreciate being treated respectfully, so avoid using jargon or fancy language here.

2. The second paragraph of the increase price letter

The second paragraph of your price increase letter should explain how much of an increase to expect. This is where you’ll explain why the increase is necessary and its impact on the customer.

If you’re raising your prices because of increased costs, use this opportunity to explain how that happened. For example, A recent increase in diesel fuel prices has caused us to raise our rates.” If you’re increasing your prices based on demand or competition, describe why there’s so much demand for your product/service: “Our customers have been requesting more healthcare services than ever before.

3. The third paragraph And Closing

The third paragraph should address any issues or concerns the customer might have with the price increase and assurances of future product quality and service. You’ll want to assure your customers that you’re committed to providing them with a consistently high-quality product, even if they have to pay more. You can do this by explaining how you’ve taken steps to ensure that the quality of your products is maintained even after the price increases, such as investing in new equipment or hiring additional employees. 

Here’s an example: “We understand that our customers may be concerned about paying more for their favorite products, but we want you to know that we are committed to maintaining the same high quality in all our products. To this end, we’ve invested heavily in new manufacturing equipment and hired several new employees to help us guarantee consistent product quality with every batch we produce.


For B2B business: you may need to🔗 business format for physical letter by adding a professional salutation such as Dear Mr. John /Mrs. Smith and sign off your name at the end. 
– For B2C business: you can add “Dear valued customers / Hi” and sign off with your team name, for ex, ” The Hola Team/ The Spotify Team.”

 Key takeaways while writing a price increase letter

During our research, we identified three main vital things for maintaining good customer relationships and sending this letter efficiently.

Send this Price increase letter well in advance

Before implementing the change, it would be best if you communicate with your customers about a price increase. It’s not just good business practice-it’s also the right thing to do! There are many benefits of giving customers a heads-up about upcoming pricing changes: 

  • Before making the change, you’ll have time to plan to build in any necessary adjustments to your marketing materials or contracts. 
  • You won’t need as much time explaining yourself after informing your customers.
  • You’ll avoid any potential backlash from angry or confused clients. You might even get positive feedback from those who appreciate knowing what’s coming next.  

Keep your letter short and direct

Although you want to explain an apparent reason in a price increase letter, no one wants to read a long essay letter. Instead, a brief explanation and highlighting the value you will bring customers through increasing price are more vital.

Limit price increases per year

Before sending the rate increase letter, check your new price carefully to avoid amendment or increasing costs again during a year. Frequent price increases can force your customers away and reflect poorly on your part and the company. 

Free Templates Of Rate Increase Letter

Rate Increase Price Letter For B2B

Create A Price Increase Letter B2B Price increase letter to clients as business (B2B) template

Sample price increase letter to clients (B2B)

Sample price increase letter to clients (B2B)

Sample Price Increase Letter To Customers (B2C)

Create A Price Increase Letter B2C Price increase announcement letter template without discount

Price Increase Letter To Customers With Discount

Create A Short Price Increase Letter With a Discount Template price increase letter to customers (B2C) with discount

Price Increase Letter To Customers On Services

Create A Short Serivce Price Increase Letter Price Increase Letter To Customers On Services Editable Template


Sending an increase price letter is often a sensible decision that may affect client retention when life is getting more expensive. Therefore, writing a professional increase price letter will need attention and carefully picking up words to keep high client retention. By the way, how do you approach new clients? Don’t miss out on our🔗 letter of introduction templates and tips to compose a good one to reach out to new potential clients.

Have you been receiving support from your team to develop products and help you increase sales? Send them 🔗 a letter of thank you for acknowledging their reliance on you.

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