If you’re still selling every new client at the same price you did a year ago, you’re leaving serious profit on the table.
Most agency owners pick a number, cross their fingers, and hope it sticks. But agencies that test pricing make more money—because they don’t optimize for the most “yeses.” They optimize for the most profit.
If your close rate is over 50%, you’re likely underpriced.
If your pipeline is full, you’ve earned the right to test.
This blog will show you exactly how to test price increases—using real math, close rate signals, and a 30-day plan that anyone can run.
Why Testing Price Works (And Why Most Don’t Do It)
Pricing isn’t set-and-forget. It’s a system you iterate.
Founders who fear price hikes usually don’t have a framework to test it. But you don’t need to change all pricing at once. The key is controlled batches and simple math.
“Hear more no’s, make more money” sounds backwards—but it’s often how profit improves.
As long as you watch conversion × lifetime gross profit (LTGP), you’re pricing with confidence—not guesswork.
A Math-Backed Example: The 10% Price Test in Action
Let’s say your agency signs 20 new clients/month at $4,000/month.
Baseline:
- Revenue: $80,000
- COGS: $64,000
- Profit: $16,000
- Net Margin: 20%
Now let’s run a progressive price test:
| Clients | Price per Client | Subtotal |
| 1–5 | $4,000 | $20,000 |
| 6–10 | $4,400 | $22,000 |
| 11–15 | $4,840 | $24,200 |
| 16–20 | $5,324 | $26,620 |
New revenue: $92,820
Expenses remains $64,000 → New profit: $28,820
New profit margin: 31%
That’s an 80% increase in profit from small, progressive changes. No additional delivery. Just better pricing strategy.
The Rule: Optimize for Conversion × LTGP
Your best price isn’t the one that wins the most clients.
It’s the one that wins the highest conversion × profit per deal over time.
So you’re not chasing volume—you’re chasing profit efficiency.
Break-Even Logic:
Old: $4,000 × 70% gross margin = $2,800 profit per win
New: $4,400 × 70% = $3,080 profit per win
You can afford to lose ~10% conversion and still come out ahead.
If your close rate only drops from 50% to 45%, you’re still making more profit overall.
What “Good” Looks Like
- Close rate stays between 40–50%
- Profit per win increases
- You maintain client satisfaction
- You get paid more for the same delivery
If you’re consistently closing over 50%, you’re overdue for a price test.
A 30–60 Day Price Testing Plan (Run This)
1. Establish Your Baseline
Before testing, track:
- Proposal volume
- Wins and close rates
- Gross margin per win
- Lifetime gross profit (LTGP) if possible
Also note your capacity:
- If your calendar is full → it’s time to raise
- If you’re selling out each month → raise now
2. Run Controlled Batches
For your next 10 qualified opportunities:
- First 5 at current price
- Next 5 at +10% (or +20% if pricing has been flat for 12+ months)
Track close rate and profit per win in each batch.
3. Decide With Data, Not VibesAsk:
- Did conversion × LTGP improve or hold steady?
- Did we hear more no’s—but make more profit?
If yes → keep the new price.
If no → revert one step and retest next quarter.
Pro tip: Don’t panic at the first “no.” Give each price band time to read.
Optional Compounding Moves (Stack These)
1. Move from monthly to every 4 weeks
13 billing cycles/year = +8.3% revenue, mostly profit
Do this on new SOWs first, then phase in for legacy clients.
2. Add a 5–12% annual increase clause
Use CPI/inflation framing in your agreements—not in your pitch.
This protects margin long-term.
Guardrails to Avoid Overpricing
To keep price and value aligned:
- Add perceived value (e.g. speed, outcome, fewer but better deliverables)
- Segment pricing by client type (enterprise ≠ early-stage SaaS)
- Monitor feedback + NPS – if conversion drops and clients push back on value, you’ve gone too far
- Watch your pipeline – if it’s full, raise; if it’s cold, fix the offer first
The Bottom Line: Test, Track, Win
Most agencies “set a price and pray.”
Top-performing ones test, track, and profit.
You don’t need to guess. You just need a system:
- Raise in small steps
- Track conversion × LTGP
- Keep what works
- Retest quarterly
Small changes. Big outcomes. And way more confidence in your business model.
Ready to Build a Smarter Pricing Strategy?
At Argento CPA, we help $2M–$10M agencies:
- Model price sensitivity
- Test profit per win
- Shift to 4-week billing
- Forecast the real cash impact of each change
Get your Agency Profit Benchmark.
We’ll show you your current rank, your pricing gap, and the fastest path to better profit.
Next page: book your 45‑minute Diagnostic—valuation snapshot + a 30‑day pricing plan with price ratchets, billing model changes, and annual increase clauses.