Even if he loses some customers on price (which he will) . . . he will make it up in margins--and, ultimately, profit is the key to a successful business.
The second key, once prices are raised, is to keep happy customers coming back That's because the key to a viable business is repeat business. There's no sense working hard and devoting hours to what is basically a low-paying job--even if it is his "own" business.
That said, having his own business means he is in control, and he has the power to increase his profits and decrease his time spent working--two results that can be measured by running the business at higher prices, rather than having the lower-priced business run him.
All the best.