By the end of Q1, it was clear that the cost of everything in 2025 was going to continue to rise, especially with the new administration coming in for the United States. Costs were climbing faster than forecasts, budgets, and most pricing strategies. Government funding was slashed and tariffs were introduced. What many business owners hoped would level out simply did not. Most businesses waited to raise their prices because they did not want to be another reason that life was hard and expensive.
When Price Stability Starts Working Against You
Holding prices can feel like the safe and kind choice. It signals consistency. It feels fair. It avoids uncomfortable conversations. And for a while, it can even feel like the “right” thing to do.
But when costs increase and pricing stays the same, something has to absorb the difference. That something is usually margin, cash flow, or leadership energy within your business. What looks like stability on the surface for your clients often creates quiet strain behind the scenes. Profit gets thinner. Cash flow tightens. Decision-making feels heavier. The business still runs, but it does so with less room to breathe and you might find yourself needing to take out a loan, laying off positions, or reducing your own pay. All at the cost of kindness for your community.
Inflation Showed Up Everywhere, Not Just Payroll
Payroll gets the most attention, but it was far from the only thing that changed this year.
Software subscriptions increased.
Shipping costs climbed.
Tariffs were introduced.
Service providers adjusted rates.
None of these changes felt dramatic on their own (except for tariffs). Together, they reshaped the economics of running a business in 2025. When pricing stayed flat, profit carried the weight, which means the ability to run your business with cash reserves were severely impacted.
This is where many owners felt the squeeze without fully understanding why.
Why Pricing Must Be Revisited Through EPI
This is where the EPI formula brings clarity.
Expenses + Profit = Income.
Pricing that worked last year may no longer support your expenses today. Pricing that worked LAST MONTH may not support you right now. And if your profit is not intentionally built in, your cash reserves disappears as you cover the increase of expenses.
Using EPI forces you to look at the full picture:
- What it actually costs to operate your business currently
- What level of profit your business needs to stay stable and build/maintain your reserves
- What income is required to support both
Pricing is not about charging more for the sake of it. It is about aligning income with reality.
STOP Bank Accounts Reveal the Truth Faster
This is also where STOP bank accounts tell the truth more clearly than a single balance ever could.
When pricing is aligned, your STOP bank accounts can be funded consistently:
- SAVINGS grows instead of being drained
- TAXES are planned for instead of feared
- OPERATIONS cover payroll and expenses without stress
- PROFIT SHARING becomes possible, creating gratitude among your team
If pricing does not support these accounts, the issue is not just about the costs of doing business, it is also about your need to raise your prices to be sure your company is taken care of.
Pricing Feels Personal, Even When It Should Not Be
Price decisions often come with emotion. Fear of pushback. Fear of losing good clients. Fear of misjudging your value.
But pricing is not just about feelings. It is about alignment with your clients and your business. Prices must support real costs, real capacity, and the quality of work you want to deliver.
Avoiding increases usually forces compromise somewhere else. Delayed hires. Burnout. Cutting things that actually support growth and client experience. Plus, you take on more clients that you don’t really want to work with because you need the money coming throught the door.
Waiting Always Makes It Harder
When pricing adjustments are delayed, they tend to become larger and more reactive.
Early increases feel intentional and set you and your clients up for success. Late increases feel like damage control and carry guilt because it is something you have to do versus something that will prepare you for the future.
January sets expectations for the year. It gives pricing time to do its job instead of trying to recover lost margin later. This is one of the most common patterns that shows up when reviewing year-end financials.
Aligned Ways to Reset Pricing Now
A pricing reset does not have to be dramatic or disruptive. There are thoughtful ways to adjust without burning trust.
- Raise prices for new clients first
- Increase minimums instead of across-the-board rates
- Adjust packages to reduce over-delivery
- Introduce a clear cost-of-doing-business adjustment
- Price new offers using EPI before they launch
What to Take Into the Rest of the Year
If this year felt tighter than expected, it may not be because your spending was out of control. It may be because your pricing stayed still while costs kept climbing.
Pricing is not about charging more. It is about building a business that runs with stability instead of strain.
Final Thoughts from Your Favorite Accountant 🧡
Stable pricing in an unstable cost environment quietly erodes cash flow. Revisiting your pricing is not a failure. It is a necessary recalibration.
If you want help reviewing your pricing through the lens of EPI and aligning it with your STOP bank accounts, I am here to help you!
Next steps if you are ready:
- ✅ Hire My CFO for done-for-you bookkeeping
- 👩💻 Join my January Quarterly Workshop
- 📚 Use my STOP Method book and workbook to rebuild your pricing foundation
👉 Because at the end of the day, cash flow isn’t luck, it’s strategy.
