How to respond to a supplier price increase

Validate the increase before accepting or rejecting it

1. Confirm which SKUs are actually affected — a notice can read as a blanket increase but only cover part of your order history with that supplier.

2. Find the exact previous cost for each affected SKU — what you've actually been paying, not an old quote you never bought against.

3. Calculate the absolute and percentage change per SKU. A single blended "X% increase" in the notice can hide a handful of items moving far more than that average.

4. Check the effective date against orders already placed or in transit — notices don't always apply retroactively, and it's worth confirming rather than assuming.

A Price Change comparison of the supplier's old and new price list does the first three steps for you — every changed SKU, flagged, with its percentage change calculated. See how to analyze a supplier price increase for the full calculation method, including the margin impact.

Quantify the margin impact before you reply

The number that actually matters for the conversation isn't the supplier's percentage increase — it's what that increase does to your margin at your current selling price. Map your selling price alongside the cost comparison and CostRift shows the margin change and the target selling price that would preserve your previous margin, per SKU. The margin impact calculator does the same arithmetic for a single item interactively.

Questions worth asking the supplier

• What's driving this specific increase — raw materials, freight, labor, currency? A cost-driven increase and a margin-driven one call for different responses.
• Is this increase final, or is there room to discuss it — particularly on the SKUs where the increase is largest relative to the others?
• Does this match what the supplier has told other customers, or market movement you can verify independently?
• Is the increase being applied uniformly, or did some SKUs move more than others for a specific reason?

Negotiation levers worth having ready

1. Phased increase

   Ask for the increase to take effect in steps over a set period instead of all at once — gives you time to adjust pricing or find alternatives without a sudden margin hit.

2. Price lock

   Ask to hold current pricing through a specific date — useful if you have fixed-price commitments of your own that run past the supplier's effective date.

3. Volume trade

   If your order volume has grown, ask whether a higher committed volume offsets some of the increase — a real lever only if the volume claim is genuine and you can commit to it.

4. Alternatives, where appropriate

   For a non-critical SKU with real substitutes, comparing quotes from other suppliers is leverage even if you don't switch — and sometimes shows the increase isn't market-wide.

Asking for all four at once in one email tends to read as a stalling tactic rather than a genuine negotiation — pick the one or two that are actually realistic for this supplier relationship.

A negotiation checklist

Everything above as a working checklist — before replying, questions for the supplier, negotiation options, and the decision at the end — to work through and check off rather than re-read as prose each time a notice lands.

A response email template

A structure to fill in with your own supplier, SKUs, and numbers — not a form letter to send unedited.

Subject: Re: Pricing Update — [Supplier Name], Effective [Date]

Hi [Contact Name],

Thanks for the notice about the upcoming price changes. Before we update
our ordering, I wanted to go through the specifics with you.

Looking at the items affected, here's what I'm seeing against our current
pricing:

- [SKU / Item]: [old price] -> [new price] ([+X%])
- [SKU / Item]: [old price] -> [new price] ([+X%])
- [SKU / Item]: [old price] -> [new price] ([+X%])

A few questions before we confirm the new pricing on our end:

1. What's driving this specific increase — raw materials, freight, or
   something else?
2. Is this increase final, or is there room to discuss it — particularly
   on [specific SKU/item], where the increase is largest?
3. Can we lock in current pricing through [date], or phase the increase
   in over [timeframe] rather than all at once?
4. Given our order volume on these items, is a volume-based adjustment
   possible, or a trade on payment terms?

If the increase stands as quoted, we'll need to update our own pricing
accordingly — I'd like to confirm the exact effective date and whether it
applies to orders already in process.

Appreciate you flagging this ahead of time. Let me know your availability
this week to talk it through.

Best,
[Your Name]
[Your Company]

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