Price Increase

A price increase is raising what existing or new customers pay for the same product or plan. In SaaS it usually means higher list prices for new customers first, followed by a staged move of existing customers onto the new rates at renewal.

A study of Fortune 500 companies found a 5% price increase lifts operating profit by 22%, more than the same percentage gain in volume or cut in costs. Among the top 500 SaaS and AI companies with public pricing, there were over 1,800 pricing changes in 2025, about 3.6 per company, and average SaaS price inflation ran at 8% to 11% a year.

Potio’s take: Most SaaS companies wait too long. Churn is visible and underpricing is not, so doing nothing feels safe. Raise prices with a structured process that removes risk at each step, and expect some churn. If nobody complains, you did not raise enough.

How this plays out

Potio’s process runs in four steps:

1. Design. Decide the scope, then split customers into four ARR quartiles of roughly equal revenue. For each, ask whether churned customers would go to a competitor or to nothing. Set prices more aggressively than feels comfortable, because the next steps are there to catch mistakes.
2. Validate. Show the new pricing to finance, sales, customer success and product. Then show customers, packaging first, model second, price points last. Listen for what they compare you to, not whether they say “expensive”.
3. Test on new customers. Sell the new prices to new buyers for a full sales cycle. If they buy in a competitive market, the price is fair.
4. Roll out to existing customers. Move them in cohorts of about 25% of ARR, two to four weeks apart, aligned with renewals and with 60 to 90 days’ notice.

Communication matters as much as the number. Show current price, new price and effective date. Anchor the message to what has improved. Do not apologise, and do not blame inflation.

A price increase has limits. A 10% annual bump keeps pace with the market, but if pricing is two or three times below value, only a new pricing structure closes the gap.

How often should SaaS companies raise prices?

At least once a year for most, and more often for fast movers. Each individual customer should see a change no more than once a year.

How much churn should you expect after a price increase?

Some, and it is usually the most price-sensitive, lowest-value customers. Those who stay tend to expand more and need less support.

Should existing customers be grandfathered?

For a limited time only. Long grandfathering periods are a tax on growth. Use 6 to 12 months with a clear end date.

More on this: SaaS Price Increase: A Step-by-Step Playbook

Also called: raising prices, SaaS price increase, price rise.

Updated 29 September 2026