How To Write A Price Increase Letter (Examples & Templates)

A price increase letter is a letter sent by a seller notifying customers about a rise in prices. This might have been brought about by a change in the industry where the raw materials needed, or the services offered to produce your product become costly.

Free Templates

Price Increase Letter Template 01

Free Price Increase Letter Sample 02

Example of Price Increase Letter Format 03

Printable Price Increase Letter Template 04

Editable Price Increase Letter Example 05

Word Format for Price Increase Letter 06

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Price Increase Letter Sample in Word 08

Printable Price Increase Letter Example 09

Editable Price Increase Letter Format 10

Price Increase Letter Template for Free 11

Sample Price Increase Letter Format 12

Word Template for Price Increase Letter 13

Free Price Increase Letter Example 14

Printable Price Increase Letter Sample 15

Editable Price Increase Letter Template 16

Price Increase Letter Format Sample 17

Price Increase Letter Template Example 18

Free Printable Price Increase Letter 19

Word Format Price Increase Letter Sample 20

    How to Justify Price Increase

    The price increase can be a sensitive topic to clients. Some, if not all, of your clients will have different opinions and complaints concerning the change. They will need sensible reasons and even feel betrayed but at the end of the day, the main goal in business is to increase profits rather than maintain customer satisfaction. you as an entrepreneur.

    Communication is vital in such a situation. You can sync your sales department and the customer service teams to provide customers with consistent information. This information would consist of valid reasons like the change was due to the possibility of the rapid growth of population in the area, therefore there was more demand for the product which led to the price rise. Perhaps the company had to buy imports at a higher price, the clients will be affected by having to pay more for the products. It could also be a possibility of the inadequacy of industrial production, particularly in respect to basic consumer goods or agricultural inputs, to match the rising demand this would also cause a rise in price levels on the supply side. It may be, to avoid deficit spending.

    Deficit spending means spending to the point of exceeding revenue over a period, which resulted in an increased level of prices.

    All these would be among many reasons justifying the price increase and they should be well communicated to your team. This is because the customers might want to siphon information from people in the sales department and the same time, enquire from the people in the service department. Generally, the best way you can deal with this situation is to assure your clients that this change will improve product and service quality.

    How to Write a Price Increase Letter

    Price increase letters are formal documents. As a professional businessman or woman, you want to send your clients these letters ensuring that by the end of the day, you have made the changes and they are still willing to work with you. You need to be keen on the details you want to cover in your price increase letter.

    Start with an appreciation

    In business, client appreciation is salient. Show appreciation for customers by stressing the value they delivered. Mention how they have impacted your business.

    For example, in the Tank industry,

    “First and foremost, we would like to thank you for your partnership during the years and for allowing us to serve your needs, thanks to your big purchase in 2020, we got five more clients who increased sales by 16% that month. Your satisfaction is very important to us, and we hope that we have been successful in providing you with excellent customer service and products.”

    Write a confident statement

    If you want your business to be successful, you need to get comfortable with raising your rates. Being direct makes your expectations very clear, and as a result, you are more likely to get what you want.

    For example, in a Lubricant company,

    “Please be advised that [name of company] will generally increase prices up to 4% on all Passenger Car, Motorcycle, Commercial and ancillary products effective, Monday, June 18th, 20XX.

    Excite through an extension

    Build relationships with your customers. In a price increase letter, giving a customer an extension of the current rate is one of the easiest ways to gain their loyalty.

    For example, you could say,

    “My rates will apply from $300 to $500 on April 24th. However, since you are one of my most valued clients, I’m offering you a complimentary extension of current rates until May 23rd.”

    Have an open discussion

    Give customers a way to contact you. Make them comfortable by having a dialogue; this is by sanctioning them to express their ideas regarding your service or product and offering to answer their questions. This will emphasize your dedication.

    For example,

    “What do you think of this new rate?”

    Conclude with a future-focused statement

    End your price increase letter with an encouraging message of high expectations of working with them on future projects.

    This can be written as:

    “As we start the year, I’m more than happy to continue working with you in business, to a better future!”

    Professional Price Increase Letter Samples

    The examples below will show you the different ways you can easily format your price increase letter:

    General Price Increase Letter Sample

    April 6th, 20XX.
    Fifth square Avenue.
    David Holmes

    Price Increase Notification

    Dear David,

    This letter is meant to advise you that there will be an increase of 5% on our tanks to be put into effect on May 1st, 20XX. This increase is due to the scarcity and expense of the tanks from our suppliers.
    Titans Company is committed to offering a guaranteed quality you deserve and the highest level of efficiency.

    All orders made before May 6th will be honored with the current price, so we highly encourage you to take advantage of this.
    Titans Company greatly appreciated your continued business and support through this time of growth and change. If you have any queries regarding this price increase, do not hesitate to reach out to us.

    Tim McCovey

    Increase in Material Cost Letter Sample

    Roseville Ave,
    48 Backstreet.

    April 6th, 20XX

    RE: Price Increase Notification

    Dear Ms. Johnson,

    Infuriatingly, we would like to inform you that we are planning to increase the price of our building materials due to the sudden increase in the cost of timber we use for the production process. Since we have limited stock of the raw material, the price increase will not be made until May 1st 20XX.

    It is important that you know of our endless efforts to prevent this price increase. However, this increase in the price of the timber is now too great to absorb, and this has led to a slight increase in the price of the following items:

    • Kitchen worktop- $400
    • Kitchen and Wardrobe units- $900
    • Electrical fittings- $600
    • Plumbing supplies- $300

    If you have any queries regarding the change, please feel free to contact us. Thank you for understanding.

    Yours sincerely,
    Builders Warehouse Ltd.

    Increase in Operating Costs Letter Sample

    Elisa Housing Cooperative Society Ltd
    302 Falls Blvd,
    Thirty NA 4858

    RE: Price Increase Notification

    Dear Emily,

    Greetings, we would like to make you aware of an increase of 10% on rent this year to be put into effect on 1ST July. This will give you adequate notice to manage and incorporate this change accordingly.
    We hope you have enjoyed the improvements that have and continue to be made to the property. Because of the increase in maintenance costs and upgrades, we reluctantly inform you that the rent is being increased by $40 per month.

    Effective from May 1st, your new rent will be $340.

    Your current security deposit of $50 remains the same until further notice. Please pay a total of $390 ($340+$50) before the given date (May 1st).
    We have been very happy to have you as a resident and hope you will stay with us. We do not foresee any other rent increases this year. If you might have any queries, do not hesitate to call us.

    Yours sincerely,
    Elisa Housing Finance department.

    Tips to Disclose Price Increase

    Here are some great tips that you should consider when disclosing price increase to your customers:

    • Recall what your goals are- Getting intentional with your goals means creating a clear connection between you and customer satisfaction. Remember the results the customers expected when they chose your products or services and write down what you have achieved.
      An example would be,

    Since February 2020, we have achieved;

    • More customers in need of Azithromycin
    • One more staff in the dispensing department
    • Demand for Gentamycin rose by 10%
    • 3 more clients from the United Kingdom
    • Follow up- A regular follow-up gives customers a chance to engage with you effectively. It is therefore advisable to send a follow-up email.

    “Greetings Harriet,
    What did you think of our new prices?
    Please get back to us if you have any questions. Thank you!”

    • Know when to move on- Not every client will be pleased by the changes in prices, that is why you need to try and justify reasonably. If you and the client still contradict each other, the best way to deal with the situation is to drop him/her and find better clients.
    • Directly communicate with customers- As an entrepreneur, it would be advisable to reach out to every customer and let them know about the change. Acknowledging your customers is a powerful way to show them that you have them in mind while making the decision. It would be unfair to your customers if you don’t communicate directly to them about the price increase. They might drop you and opt for other sellers.
    • Tell customers in advance- Telling your customers in advance gives them time to process and weigh out their options. Ensure you give them at least 1-2 months‘ notice for your new rate to commence. For example, during a pandemic, things get tough, and jobs are lost. A landlord might want to increase rent due to a rise in the expense of utilities; giving your tenant a heads up a month or two before, may save him/her the agony of having to end up on the streets.
    • Ensure quality will also upgrade with prices rising- A customer who has been purchasing a certain product for years at a specific price will be confused when he/she hears about a sudden rise in the price of the product. Remember, higher prices attract better quality products and services to clients. You will have to convince the customer that with an increase in price, there is an improvement in the quality of the product.
    • Inform the organization before the customer- The customers might want to consult with one of the frontline workers about the changes in a company. It would be a serious case if your employees were not made aware of the price increase and end up charging the clients the original price of the product. Your sales will be reading different from what you except and your next step would be to accuse your employers. Therefore, to avoid being in such a situation, it would be advisable for them to learn and contribute to the reasoning and logistics behind the changes in price.
    • Be available for customer queries- An entrepreneur looks forward to providing the best relationship with his/her customers. Let your customers know that they can communicate with you or anyone in your company at any point in time about any concerns regarding the price increase.

    Frequently Asked Questions (FAQs)

    Which ways to opt for informing the customer about price increase without losing them?

    The best way to let your customers know about an increase in price rate is by sending an email to their respective addresses. It is also advisable for you to remember that you need to get comfortable with raising your rates if you want a successful business.

    What is the purpose of the price increase letter?

    A price increase letter informs your clients about a price increase of a commodity or service. It is considered a kind gesture towards your clients to keep them in the know of the changes happening in your company.


    Telling your loyal customers about a price rise can be delicate. You will be worried about how they might react or even reject it and drop you as a seller. All in all, you must remember that by the end of the day, you will need to run a profit-making business. You must handle the issue of price increase authentically to ensure that the customers understand the situation and are willing to cohere to it.

    About This Article

    Ryan Powell
    Authored by:
    Professional Business Management, Quality Assurance, Human Resources, Supplier Management
    With over 15 years in professional business management and an additional 4 years in e-commerce, Ryan Powell has distinguished himself as a strategic leader, steering sites to generate revenues exceeding $100 million. His approach emphasizes proactive problem-solving and profit optimization. Personal attributes such as strong organization, time management, and team collaboration bolster his professional portfolio. Ryan's experience spans leadership roles from Supervisor to General Manager, with notable contributions in Tier 1 Aerospace sectors, partnering with industry leaders like Boeing and Raytheon. He's adept at quality assurance, aligning with AS/ISO 9001 standards, lean methodology, financial management, including P&L oversight, and human resource strategies that prioritize employee retention. Ryan's comprehensive skill set positions him as an invaluable asset to growth-focused organizations.

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