The economics of managed services have shifted drastically over the last few years. Between the rising costs of technical talent, the increasing price of your tool stack (RMM, PSA, security vendors), and the persistent sting of inflation, keeping your per-user or per-device pricing flat is likely no longer sustainable.
You know you need to raise your rates to maintain your margins. However, you also know that your clients are suffering from “subscription fatigue.” They’re tired of every SaaS tool and vendor in their budget inching up by 10% every January.
While raising prices is necessary, the real danger lies in the delivery. When you raise your rates, your account managers and vCIOs are the ones who have to look the client in the eye (or the camera) and explain it. If you mishandle this rollout, you put your team in a difficult position where they look like the bad guys. If you make the conversation too difficult, clients may start looking for a cheaper competitor.
Understanding the client’s burden
To you, a 10% increase on a monthly contract is a math problem that solves a margin deficit. To your client, it’s a budget disruption. They’re often juggling price hikes from multiple vendors, rising energy costs, and their own payroll challenges. If you present a massive bill increase without context, you become just another “cost” to be managed rather than a partner to be valued.
You have to approach this with empathy. Don’t just send a mass email or a sterile invoice notification. That is the quickest way to burn goodwill. You need to treat a price increase as a structured account management campaign. You are re-selling the value of your partnership, not just asking for more money. If you treat the notification as an administrative afterthought, your clients will resent the extra strain on their operational expenses.
The rule of “give” when you “take”
There is a psychological lever you must pull when asking for more money: the concept of reciprocity. Never announce a price hike in isolation. You must always pair it with a value announcement. This could be the inclusion of a new security tool in the stack, an improved service-level agreement (SLA), or a new compliance reporting feature.
You want your vCIO to sit down with the client and say that the price is going up because the service is evolving, not just because it costs more to deliver. Even if the “new feature” is something you were planning to roll out anyway—like upgraded EDR or enhanced backup verification—bundle the announcement. It changes the narrative from “inflation is hitting us”to “we’re investing in your security.” This gives your team a positive talking point to open the conversation, rather than leading with the negative financial news.
Arming your team with the “battlecard”
The most actionable thing you can do for your account management team this month is to write the script for them. Create a “Price Increase Battlecard” or a clear, concise one-pager they can reference during client meetings. This document should clearly outline the drivers behind the change.
Be transparent about where the money is going. If your cyber insurance requirements have driven up your own costs, say so. If you have hired a dedicated security team or invested in 24/7 SOC monitoring to combat ransomware, list that as a direct benefit to the client.
Clients are generally reasonable when they understand the inputs. If they think you are just padding your profit margins, they will shop around. But if they see the increase is funding the protection that keeps their business secure and compliant, they’re more likely to accept it. Your account managers are busy managing relationships; they don’t have time to invent these justifications themselves. If you provide the ammunition, they will successfully defend the value of your services.
Timing and contract integrity
Finally, you must respect the calendar. Don’t announce a price increase in January that goes into effect in February if it violates the notice period in your master services agreement (MSA).
Give them a long runway. A ninety-day notice is the industry standard for a respectful business relationship. Better yet, offer price protection to clients who renew early. For example, offer to lock in the current rate for another 12 months if they sign a 3-year renewal now. This gives the client a “win” by avoiding the immediate hike, while you secure the long-term recurring revenue that adds valuation to your MSP.
