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Whenever there is a substantial cost increase in materials, chemicals, outside services, or some other purchased item that the entire market is also experiencing, go to the buyers and warn them costs are going up and for now you are holding up any increases in order to watch the market (you are on his side, you are a good guy).
If you decide to ask for a price increase, the time when all prices are rising is the easiest time to do it. Outside influences are causing this and you get to blame the market, a fact that everyone knows about. If you decide not to raise prices, at a minimum, tell the customers what is going on and that you are doing him a favor. Remind him because months later, your kindness in not raising prices will be forgotten.
If you delayed price hikes to be nice to your customer, stop it and raise them now. After a month or two of further cost increases in the market, you may have to make the decision to ask for more money. Since you kept him informed, the buyer will be aware of this market change occurring from the complaints he is hearing from other vendors. You kept him informed upfront and he will appreciate it privately. Go in and tell your customer after delaying your decision after careful analysis, prices must be raised to pass on these rises in material costs. You will not be the first guy who says this. He will have heard this already from other vendors so now will be the perfect time to ask for higher prices.
When the market is in an uproar, announce your price hike immediately along with the others. Remember that it is always much easier to get price increases when the general market is in turmoil. You are not the only one creating problems for the buyer so you do not look so bad, especially when you kept him informed upfront and held off for a period of time. Your buyer will be bombarded with requests; his sales people will be raising prices also. When costs are rising across the markets, get in there with your price increases and correct some of your product cost problems. This does not happen often. Tell him now. You will not be alone.
Sell old stock at old prices and remind the buyer you did him a favor. One favorable thing you can do is inform the buyer of the new price of material from this day forward, but also offer to sell him anything you have in stock at the old price. You demonstrate you have looked out for him and are doing him a favor before prices rise. He should appreciate this and accept the price increase with a better attitude towards you since you are looking out for him.
