How to raise your prices with a business client

Start with the contract

Before you write anything, find the signed contract (or the quote and acceptance email if that is all you have) and read three parts of it: the price review clause, the term, and how either side can end it. A review clause usually says when the price can change (often each anniversary), how much written notice you owe and how the new price is worked out, whether by an index such as CPI, by your costs or by agreement. In construction work the same idea is often called a rise-and-fall clause.

If there's a clause, follow it to the letter. Use the index it names, give at least the notice it asks for and send the letter to whoever the notices clause names, because a rise that skips a step hands the client an easy reason to say no.

If there's no clause, the term matters. During a fixed term the agreed price generally holds until the term ends, so you either ask the client to agree to a change now or make the new price a condition of renewing. Where the work runs month to month you can usually give notice of a new price for future work, long enough for the client to get it approved or find someone else. Get advice if a lot of money rides on it, and give the next contract a review clause, which our guide to quoting for commercial work recommends for anything that runs a year or more.

The published figures that back you up

A client finds a rise much easier to accept when it's tied to figures they can check for themselves, and these three are free and hard to argue with.

CPI is the one most contracts name. The ABS now publishes it monthly and still adds quarterly figures to its data tables, so if your clause names a particular series (a quarterly figure, say, or one capital city) use that one and not the headline. The Wage Price Index shows how fast wages are rising across the economy, which makes it a fair measure if you pay your people above the award.

For award-covered staff the Fair Work Commission's decision is the strongest evidence you have, because it isn't a choice you made. The Commission handed it down on 2 June 2026 and lifted modern award minimum wages by 4.75%, with the National Minimum Wage going to $26.44 an hour or $1,004.90 a week. Our page for commercial cleaners shows what that means in hourly terms under one award. If your review date isn't 1 July you've probably been absorbing the rise for months, and that is worth saying in the letter.

A worked example

A grounds maintenance business in Logan looks after the gardens and lawns of an office park for $2,400 a month plus GST. The contract started on 1 December 2025 for two years, and clause 7 says the price is reviewed on each anniversary "having regard to changes in the contractor's costs" with 30 days' written notice.

The owner, Jo, works out that wages make up about 60% of the price and her crew is paid under the award. The rest goes on fuel, green waste fees, equipment and insurance, and because those receipts are spread across too many suppliers to track neatly she uses CPI as a fair stand-in. She applies each figure to its share of the price, which keeps her margin where it was.

She rounds the new price to $2,510 a month plus GST, a figure she can explain line by line, and the client's facilities manager can check both sources in a couple of minutes.

Writing the letter

Put it in writing, by letter or email, to the person the notices clause names, and copy your day-to-day contact so they don't hear it second-hand. Send it earlier than the minimum if you can, because a facilities manager or strata manager may need someone above them to approve a new figure. Say which clause you're relying on, give the price before GST, the GST and the total, name the date it starts and show where the numbers came from.

Hi Karen,

Clause 7 of our grounds maintenance agreement provides for a price review on each anniversary, and this is the 30 days' written notice it asks for.

From 1 December 2026 the monthly price will be $2,510 plus GST ($2,761 including GST), up from $2,400 plus GST. About 60% of the price is wages, and award minimum wages rose 4.75% on 1 July under the Fair Work Commission's Annual Wage Review. For fuel, green waste and equipment I've used the ABS consumer price index, which rose 4.3% in the year to September. Together that comes to 4.6%.

The schedule, the crew and everything else in the agreement stay as they are. I've kept the old price since the wage rise in July, and I'm happy to go through the figures with you or meet on site any morning next week.

Thanks,

Jo

When the client pushes back

Most pushback is about the budget or the surprise rather than your arithmetic, so ask what the actual problem is before you offer anything. If this financial year's budget is already set, offer to phase the rise in with half now and the rest in six months. If the total is the problem, look at the scope: fortnightly mowing through winter, or dropping a task they don't value, can bring the price down without cutting your rate. A client who wants certainty might accept the full rise in exchange for a longer term with the next review fixed in advance, and that suits you as well.

Two responses cost you more than they save. One is quietly dropping the rise and carrying the cost, because next year the gap will be bigger. The other is keeping the old price and doing less than the contract says, which is a breach of the contract and the start of a complaint.

Unfair contract terms and price clauses

The unfair contract terms rules in the Australian Consumer Law apply in every state, Queensland and NSW included. They cover standard form contracts, the take-it-or-leave-it kind that one side prepares, and a contract is a small business contract when at least one party has fewer than 100 employees or turnover under $10 million. That takes in most contracts a small cleaning or maintenance business signs, whichever side wrote them. Since 9 November 2023 it has been illegal to propose, use or rely on an unfair term in a contract made, renewed or varied from that date, and each unfair term is a separate contravention that can attract a penalty.

A term is unfair if it causes a significant imbalance in the parties' rights, isn't reasonably necessary to protect the legitimate interests of the party it favours and would cause detriment if it were relied on. A court looks at the contract as a whole and at whether the term is in plain language and easy to find. The upfront price itself can't be challenged as unfair, but the Act lists a term that lets one party vary that price without the other being able to end the contract as an example of one that may be. The ACCC's own example is a three-year contract letting the supplier raise prices at any time, which it says is likely to be unfair if the customer can't leave and likely to be fine if a customer who rejects the rise can end the contract without penalty.

So if you use your own standard terms, a line saying "we may increase our prices at any time" is the wrong way to do it. Name the index, set the notice period and give the client the right to end the contract without penalty if they don't accept the new price. If it's the client's agreement, look at the other side of the deal. Holding your price for three years while they can change the scope or end it on a week's notice is the kind of one-sided term the Act lists. Only a court can decide whether a term is unfair, so the first step is to ask for it to be changed, and the ACCC says small businesses can also get help from an ombudsman or dispute resolution service. Our guide to the first meeting with a business client covers reading their terms before you sign.

When to walk away

Before you send the letter, work out the lowest monthly price at which the job still covers award wages, your running costs and a fair share of your overheads. Knowing that figure stops you agreeing to something on the phone that you regret by Friday. Paying staff less than the award to make an old price work isn't an option, so if the client won't meet that figure the contract is costing you money every month it runs.

Leave the way the contract says, with the notice it requires, and finish the term properly. Hand over keys, access codes and your site notes, because some clients come back when a cheaper replacement doesn't work out and one you left on good terms will still take a reference call. If walking away leaves a gap in your week, Curlew finds and writes to local businesses that could buy from you, in your business name, so the next contract can start at a price that works.