Xero's price rise is coming: how to update your prices in three simple steps

Xero's prices go up again on 1st September. If those subscriptions are on-charged inside your client packages, every week your own prices aren’t updated is margin lost. Across your whole client base, even a small increase adds up quickly.

Here's how to get ahead of it, plus a link to register for our live demo on Tuesday 25th August if you'd rather see it done on screen.

What's changing on 1st September

Xero has confirmed the new prices as:

• Ignite: +£2

• Grow +£2

• Comprehensive +£5

• Ultimate +£5

Price increases are per subscription, per month.

Absorb it or pass it on?

Absorbing feels easier when you have to manually update every proposal and invoice. But left on old pricing, the costs quickly add up, and next year there will be another price rise to add to it.

A subscription cost increase of £2 to £5 per client per month, across 150 clients is somewhere between £3,600 to £9,000 a year off your bottom line. Add in the reality that a number of those clients might have moved up a Xero plan as well, absorbed software costs starts to look like the worth of a part-time salary down the drain.

Firms usually absorb for one of two reasons: the admin of repricing every client, and the awkwardness of telling them. But both problems are smaller than they look, and we’ll explain why.

What about value or fixed-fee pricing?

Some firms don't on-charge software at all and fold the cost into their price. It's clean on the proposal, but hard on profitability. With no separate line, there's no natural moment to justify an increase to the client, so each rise comes straight out of your margin. With several other vendors raising prices every year, you end up absorbing more than you bargained for. Value or fixed-fee pricing works best when you still track software costs underneath it as a separate service, and move your on-charges as they move.

Five things to do before you change a single price (the manual way)

Map who's affected. Before anything else, get a clear list of which clients have Xero in their package, which plan they're on, and what you currently charge for it. The quickest route is to download your invoice from Xero, rather than rebuilding the list by hand. If Xero is bundled into a broader fee, work out what portion of it the subscription represents.

Segment clients by their Xero package. Xero's increase varies by plan: a client on Ultimate is going up £5 a month while a client on Grow is going up £2, so different segments need different adjustments (and different messages). Group your clients by package and you can apply the right increase to each segment and communicate in bulk: one clear message per group, instead of 150 individually drafted emails.

Doing this by hand?

It's much easier in Socket. Update your pricing, apply the increases in bulk and send the client comms in one pass. See how it works →

Tell clients before the invoice does. A short message covering three things is all it takes: Xero has increased its prices, here's the date your fee changes, and here's the new amount. Name Xero because it makes clear this is a supplier change being passed through, and not a fee review.

Decide your policy. If you charge Xero at cost price, the decision is simple: the new cost is the new price. If you pass on some or all of your Xero partner discount, decide whether clients keep that benefit at the new prices.

Make it a repeatable process. Xero's increase won't be the last. Annual price rises are now standard across the practice software stack, and a system built for it will keep you profitable without hours of admin every year. And remember that once prices changes and clients are notified, every repeating invoice needs updating too: easy if you've got a handful of clients, but a nightmare if you have hundreds.

Why run it through Socket?

Alongside the time saved, the structural benefit is that in Socket, billing flows from the proposal.

Make one update to your firm's pricing, roll it out across your active proposals, and invoicing updates in sync. There's no second job of editing repeating invoices one by one in Xero, and no window where a client has agreed one fee and is being billed another. Clients are notified of the upcoming change through a formal re-issue of their proposal, with no extra admin and no new signatures required.

How to do it in Socket, in three simple steps

We built Socket's pricing tools so that a supplier price rise takes an afternoon rather than a fortnight, and so you can prove the change is complete and correct before a single client sees it. The workflow is the same whether every client is already on Socket or you're partway there.

Step 1: Get your price increase data ready.

Make sure the affected clients are in Socket, update your Xero services in the pricing menu (once, at menu level, so every new proposal can pick up the new prices with a bulk adjustment), and make sure your billing integration is connected. If not every client is on Socket yet, this is a good time to bring them in.

Step 2: Validate the price increases with Price Monitoring.

Upload your Xero invoice and let Price Monitoring do the checking. Does everyone who should have a Xero line item actually have one? Does what you're charging today match your pricing menu? Then toggle between current and future pricing to see the expected uplift before you change anything. You'll know exactly what the increase is worth and exactly who it touches with no spreadsheet reconciliation.

Step 3: Apply subscription price rises in bulk.

Bulk Price Adjustments rolls the increase across your clients in one go. You review exactly what will happen to each fee before you confirm, client communication is built in, and your billing updates to match. Any stragglers picked up in step 2, like a client missing a service, can be fixed with a minor adjustment straight onto the proposal.

Run in that order, the September increase becomes a checklist: get set, prove it, apply it. And when your first post-increase Xero invoice arrives, run the Price Monitoring check again to confirm nothing slipped through.

See it live on 25th August

If you'd rather watch the process end to end, join Si for a live demo on Tuesday 25th August at 11am (UK time).

He'll walk through the whole workflow on screen, whether all your clients are on Socket or you're not there yet. He'll also cover the questions we hear most, including billing date differences and what to do if you're not using Socket billing. Can't make it live? Register anyway and we'll send you the replay link.

Register for the webinar here