Raise Renewal Prices in Two Smaller Steps

A renewal notice can hide a bigger move than the first invoice line. Sophos's two 10% moves, one after the other, raise list price by 21% in total. A customer will remember that total. Split the increase into two renewal-timed steps, and make the cumulative math explicit before the first invoice. That protects margin without triggering churn.

The customer is making a cash decision, not a branding decision. Because you read the bank balance daily, a renewal increase should protect cash without forcing a new default. Slower growth is a deliberate choice, so the first step should be small enough to survive a quick read. The second increase should arrive only after the first has become the new baseline.

Move the cost-driven tier first

Identify the line item that is driven by hardware, licensing, support, or delivery cost. Move that tier first. The margin tier stays put until the second step.

Sophos's first 10% step started on July 1, 2026 for XGS firewall hardware and the subscriptions tied to it. The second 10% step for XGS hardware and attached subscriptions starts on November 1, 2026 for term licenses, and on January 1, 2027 for managed service provider offerings.

Owners who already bought XGS appliances still pay more at renewal, so the increase is not limited to new hardware purchases. The 10% firewall move applies to XGS Series hardware and the subscriptions attached to it, but non-hardware subscription lines for virtual, software, and cloud deployments stay outside that change. Sophos Email's subscription line goes up 7.5%.

A hardware-attached subscription is a different renewal conversation from a pure software subscription. If your cost base is tied to a physical device, a managed service, or a licensed component, that is the part that should move first. Tie the increase to the line item that actually changed. A changed hardware line gives the customer a visible reason; a changed support line does the same.

Build a ladder the customer can check

• Move the cost-driven tier at the next renewal. A single line item changes, while the rest of the quote stays flat.
• Hold the margin tier for one renewal cycle. The customer sees a smaller first step and a clear reason for it.
• Time the second step to the following renewal. The second increase is visible in the renewal notice, not hidden in a mid-term amendment. Do not apply both steps at once; that turns a staged plan into one large jump.
• Publish the cumulative percentage. The notice says the total change from the prior year, not just the latest increment.

Send the first renewal notice early enough for the customer to plan cash. Give the second notice the same clarity, so the next increase is part of the plan.

Put the cumulative percentage on the notice

When the next increase follows the first, the customer should see the whole move, not two separate surprises. Multiply the old price by the first step, then multiply that result by the second step. Put the old price, the first new price, the second new price, and the cumulative percentage on the same page. The renewal math should be easy to check in one pass.

Term and upfront customers can still renew Sophos subscriptions at today's rates through October 31, 2026, while managed service provider contracts keep the same rates through December 31, 2026. Those deadlines are cash decisions, not loyalty tests. If a customer can lock the old price for a longer term, weigh the cash benefit against the future margin you are giving away. Do not buy goodwill with a discount that the cash position cannot absorb.

Before you send the first notice, write the total change and the date it takes effect on the invoice template. If the customer cannot find it quickly, the notice is not ready.