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SueW
Forum Addict
Joined: Aug 12, 2006
Posts: 683
Location: at computer surfing cake central
Birthday: Dec 19
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Sun Apr 27, 2008 9:24 pm |
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OK, so I am pretty new to this cake/cookie decorating and so far pretty much do orders for friends. Lately they have passed my name on and now it is for "friends of friends". I am starting to have trouble quoting prices because..... well I have no idea where to start.
I guess my question it how on Earth do I come up with a basic price list??? All I really have done so far a cookies (NFSC with royal) and basic cakes as well as cupcake cakes. The largest cake I have made was 12inch round and I think I only charged 30$. I keep saying "how about 30 $.. 40$ ... ) whatever I think if fair in my head but this can't go on much longer.
Can anyone help me figure out how to price things for a beginner decorator ie. cookies , ccc's and up to 12' rounds without being stacked or tiered.
Thanks, sorry this is so long I am so stressed about his but realize now I NEED a list so I don't have to go through this every time I have an order 
SueW |
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leily
Forum SuperStar!
Joined: Jun 12, 2004
Posts: 5148
Location: Iowa
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Mon Apr 28, 2008 7:17 pm |
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I suggest add up the cost of your ingredients and about how long it will take you to make the cake (include grocery shopping, baking, cleaning, decorating, ALL of it) and then figure out an hourly rate. Add it all together and you have your price for the cake |
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meldancer
Frequent Member
Joined: Mar 08, 2007
Posts: 246
Location: Vinton, IA
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Mon Apr 28, 2008 7:41 pm |
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Look into some of the competition in your area. I looked at what bakeries, Walmart and some local cake decorators were charging and tried to make mine competitive to theirs. Also make a list of cost of ingredients for a cake and time it takes to make. Create an hourly wage for timea and see what your total comes up compared to what the competition is. Is it comparable? Are you willing to eat a little get more biz or take the chance that people will still call if yours is a little pricier than the others. |
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indydebi
Forum SuperStar!
Joined: Jul 07, 2006
Posts: 14291
Location: Indianapolis IN
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Mon Apr 28, 2008 7:49 pm |
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| SueW wrote: | | whatever I think if fair in my head but this can't go on much longer. |
This phrase tells me you are thinking like a customer and not like a business person.
A price that is "fair" and a price that is "profitable" are two different things. I'm not saying that a profitable price is "unfair" to the customer. I'm saying you have to stop thinking of what's "fair" and start thinking of "here's what I need to pay my expenses and make a profit".
this is not personal. this is business. And if you're not making a profit, then you're not in business, or at least you wont' be for very long.
Using your numbers above and based on the wilton wedding chart (which is what I use to determine pricing), a 12" 2-layer round serves 56. If you're selling that at $30-$40, that's less than $1/serving. WAY less.
Dont' know about you, but that doesn't sound very "fair" to YOU.
you need to find a consistent system to price your items and then stick to it. By the serving, by the number of cake mixes used, by the inch ... whatever .... find what works for you and stick to it. |
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stephanie214
Moderator
Joined: Oct 06, 2004
Posts: 3775
Location: Virginia;
Birthday: May 15
Gallery Supporter Member
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Tue Apr 29, 2008 8:53 am |
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Please read the following on a discussion from another thread:
| amie202 wrote: | This is the last I will say in this forum. It does apply to you. It does not matter that you are not in direct competition. Any discussion of price could be interpreted as intent to set a standard price for the industry. All I can do is URGE people not to discuss specific prices. I have been an antitrust attorney for 10 years an I promise you the discussions of price on cc have gotten way out of control and are primed for the justice department to come down hard. especially b/c it is based on the internet. I am really just trying to protect y'all and this forum b/c I love it so much. If you would like to learn more please pm me as I will not check into this forum again b/c I don't want to stir up trouble and I don't want to have any more contact with this discussion of price.
http://library.findlaw.com/1999/Jan/1/241454.html |
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jkalman
Forum SuperStar!
Joined: Mar 12, 2007
Posts: 3930
Location: Southern New Hampshire
Birthday: Oct 28
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Tue Apr 29, 2008 9:23 am |
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So we can't talk about what we charge? That's pretty crappy.. so we just let people charge next to nothing and undercut us and not say anything? We can't MAKE people charge more by suggesting they do to make sure they are making a good profit. I read about 2 paragraphs of that HUGE website summary of the laws.. Call me ADD because it was boring and helpd no interest to me I couldn't read it. I am sure there is validity to the statement.. I just find it a tad bit insane. We are not saying that everyone must charge a minimum or a maximum.. But I digress..
I'm sorry.. but to sell a 12" cake for $30 is ludicrous. You are making NOTHING and if you keep it up you will burn out FAST. I suggest you call around and see what local places (NOT Wal*Mart and grocery stores as you are not competing with them) and find out what they are charging for truely custom cakes and cookies.. not just a let me write happy birthday Joe on that for you. Find a servings chart you like and stick with it and charge per serving.. not per cake. This way all you will have to do is multiply your per serving rate by the number of servings and viola.. your basic cake price. Anything extra can be tacked on as you see fit. I hate to see bakers working their tails off and not getting anything for it.. and that's what you are doing. |
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meldancer
Frequent Member
Joined: Mar 08, 2007
Posts: 246
Location: Vinton, IA
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Tue Apr 29, 2008 11:31 am |
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I can understand that we don't want to compare our cakes to those that Walmart or grocery stores put out. However I live in a small town where they can't justify spending more on a cake than what they could spend at those places, despite quality. But it wouldn't hurt to at least include them in your list of "competitors" so you know your price range and feel good about what you charge. |
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TexasSugar
Forum SuperStar!
Joined: Sep 01, 2005
Posts: 4254
Location: East Texas
Birthday: Dec 08
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Tue Apr 29, 2008 11:59 am |
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| meldancer wrote: | | I can understand that we don't want to compare our cakes to those that Walmart or grocery stores put out. However I live in a small town where they can't justify spending more on a cake than what they could spend at those places, despite quality. But it wouldn't hurt to at least include them in your list of "competitors" so you know your price range and feel good about what you charge. |
You can't complete with Walmart prices because they get everything in bulk and there for don't have the cost of ingredients the average baker does. Plus your cakes are not shipped in frozen and iced, and they are only allowed to spend a short period of time decorating them. Most of ours are baked fresh and custom decoratred, which translates in to hours out of our lives to bake, cool, ice, and dcorate. That is time away from your family and friends!
I understand living in a small town and not being able to charge $5, $6, or $10 for a serving, but you shouldn't lose money to make a cake for someone else either. Then you aren't a business you are a charity.
I'd rather not do a cake than do a awesome cake that took me hours/days to do, and only charge a walmart sheet cake price. |
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jkalman
Forum SuperStar!
Joined: Mar 12, 2007
Posts: 3930
Location: Southern New Hampshire
Birthday: Oct 28
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Tue Apr 29, 2008 12:07 pm |
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DITTO!!! TexasSugar! I completely agree. I live in a less than affluent part of my state.. we aren't piss poor, but not rollin' in the dough either. I still make cakes and I do charge $4+/serving. I'd much rather make one cake for $400 than 20 cakes for $20 each. I can't make a cake for $30 and make a profit. It cost me $30 in ingredients to make a cake the other day.. an 8" cake. |
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meldancer
Frequent Member
Joined: Mar 08, 2007
Posts: 246
Location: Vinton, IA
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Tue Apr 29, 2008 12:57 pm |
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Don't get me wrong, I do agree with TexasSugar also. I'm just adding another perspective. My community is rural, so bakeries are farther away and what everyone is used to is the grocery store stuff. I base my price on my ingredients and time, but I also keep in mind what everyone is used to paying at those other places. I do charge more than them, but I can't do the $4 or higher a slice price because I would then never get an order. I would rather do 20 cakes at $20 each and know that I made their day with a really good tasting cake than never do them. I make cakes more as a hobby and a stress reliever from 3 busy toddlers than as a biz. Again, this was just another side of it. |
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leahs
Forum SuperStar!
Joined: Jun 19, 2007
Posts: 2859
Location: Louisville, KY
Birthday: May 29
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Tue Apr 29, 2008 1:25 pm |
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Are you licensed? Can you even sell cakes/cookies legally? |
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jkalman
Forum SuperStar!
Joined: Mar 12, 2007
Posts: 3930
Location: Southern New Hampshire
Birthday: Oct 28
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Tue Apr 29, 2008 1:37 pm |
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I'd MUCH rather be making money and making people happy than just making ends meet to make people happy. If you aren't doing this to make money then it's a hobby and should probably stay that way. Not being rude at all so please don't take it that way.. it's just that no business will thrive with that mindset. I am thinking ahead for the days when I will have more overhead. It's easier to go from $4 a slice up to $6 a slice than to go to $6 a slice from $1 a slice (or less).
I would wonder the same thing that Leah asked too. Make sure that you are able to bake from your home in your state and get yourself licensed if you aren't already. Then you can get liability insurance and your home and family can be protected. It's not expensive.. usually under $500 for a year. Well worth the piece of mind.  |
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meldancer
Frequent Member
Joined: Mar 08, 2007
Posts: 246
Location: Vinton, IA
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Tue Apr 29, 2008 1:42 pm |
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Wow, just offering my opinion once again and getting cornered. Nevermind. Good luck SueW with your price list. |
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CakeDiva73
Forum SuperStar!
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Joined: Jan 30, 2006
Posts: 2483
Gallery Supporter Member
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| Posted:
Tue Apr 29, 2008 1:57 pm |
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| stephanie214 wrote: | Please read the following on a discussion from another thread:
| amie202 wrote: | This is the last I will say in this forum. It does apply to you. It does not matter that you are not in direct competition. Any discussion of price could be interpreted as intent to set a standard price for the industry. All I can do is URGE people not to discuss specific prices. I have been an antitrust attorney for 10 years an I promise you the discussions of price on cc have gotten way out of control and are primed for the justice department to come down hard. especially b/c it is based on the internet. I am really just trying to protect y'all and this forum b/c I love it so much. If you would like to learn more please pm me as I will not check into this forum again b/c I don't want to stir up trouble and I don't want to have any more contact with this discussion of price.
http://library.findlaw.com/1999/Jan/1/241454.html |
Thanks |
I am lost, lost, lost! Can anyone read this legallese and translate it into plain English so I understand why we are not supposed to discuss price? I'm serious.....talk to me like I'm a 5 year-old because I do not understand any of this. thanks guys |
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Mike1394
Forum Addict
Joined: Feb 20, 2008
Posts: 948
Location: Michigan
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Tue Apr 29, 2008 2:01 pm |
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amie202 wrote:
This is the last I will say in this forum. It does apply to you. It does not matter that you are not in direct competition. Any discussion of price could be interpreted as intent to set a standard price for the industry. All I can do is URGE people not to discuss specific prices. I have been an antitrust attorney for 10 years an I promise you the discussions of price on cc have gotten way out of control and are primed for the justice department to come down hard. especially b/c it is based on the internet. I am really just trying to protect y'all and this forum b/c I love it so much. If you would like to learn more please pm me as I will not check into this forum again b/c I don't want to stir up trouble and I don't want to have any more contact with this discussion of price.
http://library.findlaw.com/1999/Jan/1/241454.html
Yeah the Justice dept. is coming to ask me to stop violating antitrust laws. The great cake conspiracy of '08 some fancy price fixing going on nation wide over cake, cookies, and petit fours. Toss in canapes, and we can control the nations eating habits. LOLOLOL Sorry I couldn't help myself.
It depends on what you want to do. Do you want to control your market? What level do you want to be at in that market? Find out what competitors on your talent level are charging.
Mike |
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