Words of advice from Dr. Phil, "You teach people how to treat you."

Words of advice from your mama, "Nobody buys the cow when they can get the milk for free."

Wise people, Dr. Phil and your mama.

If you guys keep giving away cakes for cost, with the idea of eventually having a cake biz, you're kidding yourself. You're not teaching people how good your cakes are and how beautiful they are. You're teachng them that you bake for cheap and work for next to nothing. What you're really doing is elevating their appreciation for expensive looking and great tasting cake. And then once they're educated in the finer things in dessert, they will seek out an expensive cake shop to do their high end/paid orders. Why? Because your reputation is making cheap cakes.

If you're doing party or wedding cakes, first charge by the serving. Use the Wilton charts for serving sizes. The customer will actually get a little more cake if the order is for a party cake, but then you dont' have the construction hassle of a wedding cake, so it all works out.

Sculpted cakes are more per serving. Fondant is more per serving because its a higher level skill.

I started out at $2 per serving. Yep, started out. That was cheaper than the high end bakeries in my city, so it was a good deal for my customers. After a couple of years I raised my prices. Then raised them again. And I'm going to raise again probably next week.

If cakes are your hobby, then fine, charge what you want, but you really can't rant about not being paid enough when you're setting your own prices. If you're wanting to turn this into a business, then act like a business.

And look at it this way. If everyone would charge a fair price, then we'd all be better off.

If I have offended you, I apologize. If I have made you think, then I have served my purpose.

Thank you.

Please resume baking.

Here, HERE!!!!

If they do not like you prices they are not worth your time or worthy of your cake talents!

AMEN, sistah! Can we pin this at the top of the forum?

thankyou leahs!! i hope everyone gets to read this post. this is business 101 and no matter how good your cakes are you will never succeed in business if you have no business skills. trying to undercut on pricing leads to cheapskates for customers. cheapskates are out to get as much as they can for as little as possible and will never make good customers. someone posted on the forum a couple months ago that very few businesses fail because of a lack of trade experience (i think 10%?). the overwhelming majority fail because of a lack of management and business skills.

When I was dog groomer, I made about $15/hr. An average dog would take about 2 hours to completely cut wash and style. When I get my hair colored, it takes about 2 hours. I don't bite, and sit very still, and it cost me about $100. When the plumber came to fix something, the bill was $65/hr.

Why is my hairdressers time and the plumbers time worth more than my time? It's all skilled labor. My customers now don't have the skill to decorate like I do, so how come I can't get $65/hr?

Sucks sometimes.

so true! I don't know y I feel bad sometimes charging $40 for a cake. I do it, but, bashfully. I wish I had more self-confidence when it comes to my cakes.

There's nothing I can add to this except to be 1000% in total agreement!!!

I've seen many many posts from thos who lament over "I give away lots of cakes so people can see what I can do but no one orders?" Yeah..... beause they know that person will always (ALWAYS!) provide a free cake.

I am not against doing anything for 'free'. If I bride spends $3500 with me on a catering, then I will "throw in" a 4th salad dressing that she wants at no cost (She writes me a check for $3500 .... I spend $6 on 2 more bottles of salad dressing ... works for me!). But if she only spends $495 on a chocolate fountain, then it's not business-smart for me to throw in a freebie, so I don't.

Run it like a business or run it like a hobby. But leahs is right. You can't run it like a hobby and expect to make it as a business.

I've figured out that if I don't get at LEAST 50-75 dollars for a cake, I lose money when I turn on the ovens.

do I give something away for nothing? NO SIREE BOB!

If I've never done a particular "cake sculpture" before, I will start off at about 100 dollars, to cover my costs and have an idea for the next time.

Do I post the pic on my web site with what I think I should be paid for it, YOU BETCHA! I know that sculpted cakes down here from a major designer area around 250-300 STARTING.

So, I'll do ONE at 100, that at least gives me a pic for my album, gives me an idea about how long, what I need to tweak and so on and so forth.

But I still get 100 plus up front, just to cover my costs and time.

If it looks crappy, the customer doesn't really complain because they got a bargain, if it's totally awesome, I get word of mouth business! But, I do tell the first one what a bargain THEY got, but the next one is the right price..lol

Leah, has anyone ever told you that you resemble Sigorney Weaver when she was doing the Ghostbusters Movie??

i love this post i too sometimes feel guilty when i tell them the price but then i think to myself if they want fresh come to me if you want cheap go to a store i have had some people who i thought were friends say my cakes are to expensive but hey i'm not begging them or persturing them to buy my cakes, but i don't give them away for free either if they want to go to a store it does not ofend me so they are not obligated to buy but there upset i don't want to give them for free either. and there are some customers who gladly pay the price because they like mine better and i am very greatful to those customers, and they are the most friendly ones.

Its a long hard lesson to learn! Its taken me years and I still haven't perfected my pricing, especially because as mentioned above alot of my cakes are sculpted as well and its hard to price those out time-wise sometimes. But once I make it one time I usually end up raising the price just in case anyone else orders the same one. I recently raised my prices and I still constantly look over what I'm doing to make sure I'm pulling a decent profit. I have three boys and one more on the way, and if I am not seeing some extra spending money collecting in my Paypal acct each time I make a cake, then its totally NOT worth it for me! I mean I enjoy decorating, but not so much so that I would just do it all weekend for pennies.

I know I'm improving because I used to get excited at the $50 orders. Now I get annoyed with them because its too much work for not enough profit. haha. I think that means I'm improving right?

After being featured in that People magazine article, yes, you need to raise them again Leah!

Even for my less than perfect cakes, I ask $45 for an 8" round with BC - no figures, no fondant, no specialty filling - just plain old traditional cake with either a FBCT or something else simple.

I spend an average of 4 hours on a cake - start to finish including clean-up. If I had to spend more time on it, then I would charge more. Now... for just labor - that's only a little over $10 an hour... when you take out the ingredients and equipment and electricity and water costs, I'm really only getting like $7 an hour (or less).

And... I was SCARED to ask for $45, but then I realized it wasn't worth my time otherwise. Sure, they can get the same sized cake at costco or the grocery store for $9 to $15, but for what quality?

NO ONE has complained about that base price - no one and I have people talkign me up, so I'm glad Ididn't start at $35 because then it would be MUCH harder later to raise those prices.

Melissa

It's often tempting to low-ball yourself when you need the money or are desperate for business... but really, we do have to train our customers. Just last week, I got a couple of calls for cakes - and they thought I was bit too expensive. It would have been easy for me to say "I'll lower my price" just to get the business (and I really could have used the money), but I stuck to my guns.

I do NOT want to get a reputation as the "cheap baker in town". I'm going to lose a lot of business in the beginning, but I will build up a client base that knows they aren't going to get an awesome scratch cake for a WalMart price.

Hell, not only do I charge what I want to charge, I charge extra ($5 or 10% - whichever is greater) if it's a last minute order (less than 3 days notice for a regular cake, less than 2 weeks notice for a tiered or wedding cake). It's not that I want the extra money, but I want people to know they'd better order early - because I don't like to feel rushed.

Very well said!!!

And I want to thank all the pros on here that are so generous and share your time, talent and expertise (cake and business) with us!

d

I would like to thank all CC'ers for your help with pricing. When I first started decorating cakes I had no idea what cakes cost to produce or the time it takes to decorate. I too was charging to little for my cakes.

Now with everthing I've learned about pricing and every skill I've learned here, a lot of customers think I'm too high. I was lowering prices to get customers at first. Now, if they think I'm too high they can find someone else. If they want my services you have to pay what I ask, up front!

I have had a few that walked away only to call a few days later and place an order. I have had a few that walked away and never came back, so be it. I bake from home and don't know if I will ever make this an outside business but either way, I have to get what I feel I'm worth and my time has to be paid for.

One of the pricing things I learned on here (I am SO bad at remembering who gave me such great pieces of advice .... there's so much good advice on here, it's just hard to keep track!) was that higher prices meant less work but MORE MONEY! (after i learn this, my reaction is "duh!" but sometimes ya just need someone to hit you in the head with a brick!)

But it's so true .... I was looking at my numbers just last night. In 2007, I already have as much in booked orders as I did in all of 2006 .... with 30% FEWER events! Almost 1/3 less work for the same money.

Yeah....I can live with that!

So if a decorator feels overwhelmed with work .... raising prices in the hopes some of it will go away can be a GOOD thing! And I learned that right here, in CC.

Thanks, gang!

First off, can I say thank you for posting this. I am new at this so my first inclination is not to charge much because of my inexperience. However, after taking a few cakes to family gatherings, potlucks, etc (it was just my offering not a cake I was asked to bring) I have realized that you're right. Most people were incredulous at the decorating I did (and I know how it compares to the ones on this site but they were still greatly impressed! ) And I don't think most of them even knew you could bake a cake from scratch! They rave about frosting that actually tastes good, they rave about fillings that are different. If they can do all that raving then they should be able to pay for it right?

The first wedding cake I'm doing is for our nephew and it is free. (Please don't scold me! My husband has already said it's the first and last free cake I will do! And the lady at the cake supply store scolded me too and gave me a good idea of what that particular cake would go for; both boxed and scratch pricing. I promise I won't do it again! )

I think when we're new and unsure of ourselves it's easy to sell ourselves short. You may want to see if you can sticky this to the top because I'm sure every new decorator should read it!

My new motto is going to be; "Pay my price or make it your dang self!"

Thanks again for a timely and helpful post.

This is very good advise. I just started doing it for money ,but ONE thing that I learned here is that I 'll make the cake YOU want but You have to pay My price. Thankyou to all you CC ers

Three thumbs up for you "leahs". I need to read your post EVERY day. Well, that just gave me a thought ~ I'm going to print your post so I can put it in a place where I can easily read it every day ~ maybe by my phone

I am tired of choosing to give away cakes. I do realize that it is a choice and unfortunately that's what I have chosen to do. I'm tired of pulling all-nighters and late-nighters too. But I hope (and I think) I'm tired enough of it to make a change. I've realized (especially since purchasing CakeBoss) that I'm not making much.

So, either I can continue as I am and wear myself out for change or I can up my price and earn a living off it. If folks don't want to pay the price then that's okay ~~ more sleep for me

Thanks for the great advice! I sometimes feel bad about charging what I think I should get for a cake, but you are right, if they want the cheap cakes, go to the store!!! It's not worth the time or the few dollars that you make to sell them for cheap. Thanks for helping me to realize it!

Love this post....
I think I have improved my "pricing skills" a bit, still need some help in that departament...
Last week I had a phone call asking for a baby bassinette cake... I love making this kind of cake is my fav... but she wanted the cake to serve 40 for less than 120 dollars, she said something like "120 dollars????????? WHY????????? IS JUST FOR 40???????" jejejeje a cake like that will take me a lot of time... and what I said to myself last time I did it was NOT AGAIN FO FREE... I did one for 70 dollares and wanted to cry when got paid!
so No more free cake from me! (please help me) jejejeje

This thread is so timely for me. I had two inquiries yesterday for sculpted cakes for this coming week. I gave them my prices and haven't heard from either one. I've been tempted to think my prices are too high, but can't imagine doing those cakes for less -- too much time and effort involved. So, thanks to you all, I'm going to stick to my prices even when I KNOW it may mean less business. I also thought about the last "trim" I got and it cost me $65 for an hour of my stylist's time (he is really good, though). If I'm willing to pay that much for someone's else's time, why do I think my time is worth any less?

People tell me that my cake pricing is high. Sorry!!!
I tell them that my cakes and icing is made fresh. I do not freeze my cakes like most bakeries in my area. And, if they do not like my pricing they could go elsewhere. I put my pride into my cakes and I do not care what people say about my pricing. I put to much time into my cakes to give them away.

Amen!! I am sure to print this out and save it for when I start selling my cakes.

BTW - your website is FANTASTIC! I really like the link "read this first"