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How to Write a Successful Fee Increase Notification Letter (6 minutes)
Creating an effective fee increase notification letter that gets your clients to agree to increased fees is no easy task!
With over 20 years of experience increasing fees, this video and article offer a step-by-step guide to creating a professional and effective fee increase notification.
Learn the eight key email letter strategies that ensure your message is clear, concise, and well-received.
From keeping your tone calm to providing justifications and avoiding apologies, these tips will help you communicate with confidence.
Whether you’re managing a property portfolio or running a business, this guide will show you how to increase your fees while maintaining trust and professionalism.
When it comes to increasing your fees with current clients, one of the most critical steps is drafting a well-worded fee increase notification email or letter.
Over the past 20 years, working with hundreds of rent rolls across Australia, New Zealand, and the United States, I've fine-tuned this process, using essentially the same letter with some minor adjustments.
In this article, I’ll walk you through the eight key elements that will make your fee increase notification letter very effective for a successful fee increase campaign.
This letter template can be found in my book, Win Your Worth Secrets, on page 72. The book is free—you only need to cover the shipping.
You’ll also receive the ebook and audiobook versions instantly so you can start learning right away. Grab your copy at WinYourWorthSecrets.com.
1. Keep It Short and to the Point
One of the biggest mistakes people make is going overboard with explanations. You don’t need a lengthy letter to justify your fee increase. A while back, I received a letter from a Pay TV company, and I could immediately tell they were raising their fees without reading the entire two pages of ‘fluff’. They spent too much time listing reasons when all that mattered was the bottom line.
Lesson: Keep your letter short and sharp. Say what needs to be said clearly, and move on.
- Standard Marketing Fee This fee covers the costs of listing properties on portals. In Australia, you’re likely familiar with the two major portals that charge fees. New Zealand has its own marketing portal costs as well. Make sure you’re covering those costs, and if you haven’t updated your fee recently, ensure you’re adjusting it, as portal charges tend to increase on a regular basis.
Don’t forget to factor in any additional marketing efforts, such as Facebook or LinkedIn campaigns. Always check your local legislation to ensure you can on-charge these costs. - Professional Photos If you’re taking professional photos for listings, you should be charging a fee to cover those costs. It’s a straightforward service, but make sure it’s reflected in your fee structure.
- Video Walkthrough Fee Offering video walkthroughs is becoming increasingly common. If you’re walking through the property with a camera or phone, narrating as you go, that takes time—editing and uploading included. You should be charging for this service, and the suggested fees are detailed in the book.
- Virtual Tour Fee Using high-tech tools like Matterport or 360-degree cameras to create virtual tours can be time-consuming and require expensive equipment. This is another service where you should be charging a fee for the value you provide.
2. Use a Passive Subject Line
Whether you’re sending an email or a traditional letter, the subject line or salutation needs to be calm and non-alarming. Never use something like “Our fees are increasing”—that only raises anxiety. Instead, use a more neutral subject like “Some Changes to Your Management Agreement”.
3. Justify your Fee Increase
You need a clear and concise justification paragraph that explains why the increase is necessary. Here’s a sample:
"Due to rising business running expenses, increasing costs of people resources and the substantial investment in time and technology to comply with legislative changes, we have found it necessary to review our fees. Additionally, we have not adjusted our fees for the past [X] years. As a result, we must advise you of the following changes to our fee structure."
This approach clearly outlines the reasons for the increase without sounding apologetic. Have the attitude of ‘This is something that we’ve had to do, and here’s why!’
4. Be Transparent About the Changes
Be transparent and clear when listing the fee changes. For example:
"The changes to our fee structure are as follows..."
List each fee adjustment plainly. Don’t hide behind vague terms like “refer to the management agreement”. Be upfront so your clients know exactly what to expect. Your letter needs to have all changes clear so no trust is breached by hiding anything.
5. Specify the Effective Date
Clearly state when the fee increase will take effect. Most agencies provide a 30-day notice, allowing clients to prepare for the change. However, be aware that in certain regions, like Australia or the United States, you may need a new signed management agreement or an addendum for these changes to be valid.
Note: In New Zealand, your management agreements likely include clauses allowing fee increases with 30 days written notice, but this varies in other countries. Always check local legislation and seek independent legal advice if necessary.
6. Provide a Point of Contact
It’s essential to direct clients to the right contact person for any questions. Typically, this will be their property manager, as they have the strongest relationship with the client. People are less likely to argue with someone they trust, so make sure that the property manager is their first point of contact.
7. Include the Required Documentation
At the end of the letter, mention the necessary documentation that needs to be signed—whether it’s a new management agreement or an addendum. Be clear about what needs to be returned to formalise the changes.
8. Don’t Apologise
Lastly, don’t apologise for increasing your fees. Your work has value, and clients should understand that this is a necessary part of maintaining the quality of service you provide. Be confident in the decision and clear about the reasons for the increase.
Conclusion: Crafting a Successful Fee Increase Campaign
Your fee increase notification letter is a critical tool in successfully adjusting your fee structure. By following these eight keys, you can make sure the letter is clear, professional, and effective without causing unnecessary alarm.
If you need help with your fee increase campaign or want further coaching, feel free to book a session with me at GetBetterFees.com.
Take care and all the best!
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