A third of US owners cut their own pay to hold prices. It's a discount nobody sees

The bank reads this as owners valuing the customer relationships they've built. I'd call it something else: a discount nobody asked for, nobody noticed, and you can't keep giving.

“A discount nobody asked for, nobody noticed, and you can't keep giving.”

Why it feels like the right thing

I understand the instinct. A price rise means an awkward email, and the clients most likely to push back are often the ones you like. Cutting your own pay is quiet. Nobody has to be told. It feels decent.

Now look at what it buys. Your customers don't know you did it, so it earns no goodwill. Your costs don't stop rising, so next year the gap is wider. And your pay is the line that funds your savings, your pension and the odd week off. Running the business on a thinner founder is how you end up tired and short of cash at the same time.

This isn't one bank's quirk. A smaller survey of 192 US owners for Omnisend, an ecommerce marketing platform, published in May, found the same: one in three had personally taken a pay cut to keep their business running.

Run the numbers

Here's the working on an invented but ordinary case. Say you run an agency billing £50,000 a month, and costs have crept up by £2,000 a month: a pay review for the team, a few more software seats, a dearer office. Take that out of your own pay and it's £24,000 a year gone from your pocket.

Charging 4 per cent more covers it in full. That's a FER calculation: £2,000 divided by £50,000. On a £5,000 retainer, it's £200 a month.

If you sell software, your version of this is the plan priced at launch two years ago, still on the pricing page while everything around it moved. Same maths, same answer.

The fair objection

There's a real case for holding prices. In a soft market, being the supplier who didn't put prices up can win you work. If you're doing that on purpose, with a number in mind and an end date, it's a strategy.

Most of the time it isn't. It's avoidance with a kind story attached. And some clients will leave over £200 a month. If you've run a services firm for a while, you'll know whether those are the clients who were going to stay through next year anyway.

What I'd do this month

1. Write down your monthly costs now and this time last year. Put the difference next to any cut you've made to your own pay.
2. Work out the price rise that closes the gap. It's usually smaller than it feels.
3. Pick 1 January. Tell clients this month and most get over 60 days' notice and a clean start to the year. Check your contracts for notice clauses first.
4. Send a short, plain email. There's a draft below.
5. When the money comes in, restore your own pay first, before anything else it could fund.

The email can be four sentences: "From 1 January, our monthly fee for the work goes from £5,000 to £5,200. Our costs have gone up this year, and I'd rather tell you straight than quietly do less. Nothing changes in what you get. If you'd like to talk it through, I'm around next week."

Your customers are paying for the work. They shouldn't be getting part of it on your wage.