← Can we raise prices without losing customers?

Insight

Some sites get priced past the point where rises add revenue. The average won't tell you which ones

Many multi-site businesses put prices up by a similar amount everywhere, every year. If revenue keeps growing across the estate, it looks like it's working.

What the average hides

Price sensitivity varies a lot from site to site. An estate average can say there's room to rise while some sites are already losing more volume than the rise brings in. Those sites can look just like the ones doing fine.

What we've found

  • In the work we've done, most sites still had room for further rises.
  • A minority were priced past the point where rises add revenue. For those, a cut can grow revenue, because the extra volume outweighs the lower price.
  • Capacity changes the answer. A full site can be price sensitive and still be the wrong place to cut. Putting a few people off costs nothing if there are others queuing behind them.

How to find them

You need price sensitivity for each site, not an estate average. That means estimating every site separately while letting them learn from each other, so smaller sites still get a usable answer. Every estimate needs a confidence range, because a pricing decision based on a single number is a guess with a decimal place.

You also need a reliable view of capacity. Recorded capacity often isn't one, and that's the part we're working on now.

Questions worth asking

  • Which of your sites are priced past the point where rises add revenue?
  • Which full sites look price sensitive but should hold?
  • Is your capacity data good enough to tell the difference?
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