schildwaster Posted 14 Oct 2007 , 1:44am
post #1 of

I want to approach a local restaurant about getting their dessert cakes from me. The lady that was doing it is getting older and wants to spend time with her grandchild. (small town we know everything) I normally would charge $20 for a simple 8" dessert cake. So questions: Do you think they will expect a wholesale discount? How much do Cisco and the other "frozen" cake suppliers charge for their cakes? Any experience in any aspect from the approach to the sale would be appreciated.

17 replies
Biya Posted 14 Oct 2007 , 1:52am
post #2 of

I owned a restaurant for about 8 years and I can tell you that I did pay more than $20 per cake and that was wholesale. It does however depend on what size and type of cake it is. Don't think I can give you an exact dollar amount its been three years since I left the restaurant business. But I can tell you to try doing a search online for wholesale food suppliers and check some prices that way. A little warning though you might have to get on the phone and make some calls. Alot of wholesalers don't post a price lists because they give their salesmen some discretion based on volume and area. Good luck

DelightsByE Posted 14 Oct 2007 , 2:14am
post #3 of

Could you talk to the lady who was doing it for them and ask her directly?

jibbies Posted 14 Oct 2007 , 2:32am
post #4 of

Over the years I have been asked several times to do this. I never did. I thought about how tied down that would make me. Every situation is different, are you doing this to make a living or is this a hobby/side income type of thing? For me this is a very pleasant pastime and I make a little money but if I thought I had to do this every week I would cry icon_cry.gif because I've been there and done that

Jibbies

schildwaster Posted 14 Oct 2007 , 12:55pm
post #5 of

they are a smaller restaurant. I think they have maybe seating for 50. They would be 8 in cakes so they take about an hour. I was thinking a very rich chocolate fudge, a lemon with raspberry filling, and a seasonal flavor like pumpkin or apple spice. I know they like pies too, which for me have to be double crusted so that limits me to apple and cherry.(unless anybody has any other double crust ideas) I have a business and this would be kind of suppliment so i always have something. I just started my business on a shoestring. i'm legal but i have two kids at home so if i can bake a simple dessert cake or two a day, thats perfect for me. Its not a living. Just something to keep my mind from shriveling as a stay at home mom.

daranaco Posted 14 Oct 2007 , 1:26pm
post #6 of

Something else to think about is that if the restaurant owner knows the general public can buy your cake for $20 then he's not really getting a deal by ordering from you. Why would a couple at his restaurant pay $5 for a slice of cake when they can get the whole cake for only $20?

I would definitely offer him a volume discount. Say if he orders 1-2 cakes/pies per weeks, each cake is $17 dollars. If he orders 3-4, each cake is $15, etc. Those numbers are purely arbitrary so you'll need to calculate what amounts work best for you and your time/supply costs.

There is also another thing to consider such as how unique are your cakes for your area? Do most of the bakeries/cake decorators use cake mixes but yours are doctored (or scratch)? If so, you may be able to ask for more money since you are different. Or maybe you offer exclusive flavors and recipes to their restaurant only (not available to your direct customers) so that you can charge a higher price.

You may also want to consider giving him a really good price on the cakes in exchange for advertising that the now serve "Such-and-such" cakes. This way everyone would know they could get tasty cakes from you directly. You may see an increase in your inividual orders.

Whatever you decide, make sure you get it in writing!! Contracts may seem very legalistic but it will protect both of you from getting into (or out of) a relationship that could turn sour.

Edited to add: please read my response below before responding to my $5/slice comment! I clarified what I actually meant.

pieceofcake1 Posted 14 Oct 2007 , 1:39pm
post #7 of

I supply a local coffee house with large cupcakes and brownies,peanut oat bars and scones EVERYDAY. And every Wednesday I supply a local rest. with an apple pie, 10 inch layer carrot cake and a double ginger/blueberry cake. The pie is $16.00,carrot cake $24.00,ginger cake $36.00. You should realize that people do expect to pay 5.00 a slice for desserts in a restaraunt. I know my prices are still too low. I would say to make sure that it is a "standing order' and and cancellations require at least 48 hrs notice. Wholesaling is a great way to have regular income especially during the slow times in the shop. You will get a good feel for people for are easy to deal with and not try to take advantage of you. Go for it!! What do you have to lose.

weirkd Posted 14 Oct 2007 , 1:48pm
post #8 of

If you order dessert at Oliv Garden and places like that, their $5 and up.

adven68 Posted 14 Oct 2007 , 1:48pm
post #9 of
Quote:
Originally Posted by daranaco

Why would a couple at his restaurant pay $5 for a slice of cake when they can get the whole cake for only $20?




To answer this, you might ask why anyone would pay $25.00 for a steak when the supermarket sells it for $7.99/lb. icon_smile.gif

People pay...believe me! I've been in the restaurant business all my life. Now, I don't know what type of establishment the OP is thinking of approaching, but my experience is that when someone is having a nice meal in a nice restaurant, they'll just order dessert. They know whether they can afford it or not before they decide to visit a particular establishment, I think.
I do think your best approach is simply to ask them. thumbs_up.gif

schildwaster Posted 14 Oct 2007 , 2:00pm

this is a small town and while people will pay 5 a slice it has to be a spectacularly large dessert. I'm looking at cutting a deal for my cakes with a standing order. the most they would probably charge is 3.25 a slice or max out at 4 for a big piece of cake or pie with icecream and sauce. so looking from their standpoint, they are going to want to make how much a slice off of the cake. $1.00 or less? i hate to sell myself short if restaurants only look to make .50 cents or so. anybody have experience on restaurant mark up?

daranaco Posted 14 Oct 2007 , 2:01pm

I don't think I was clear on what I was trying to say. I completely agree that people will pay $5 for a slice of cake at a restaurant. In fact, I'm one of those people!

But if it's a small town and everyone knows that it's Susie (made up name) who bakes the cake for the restaurant and a whole cake is only "worth" $20 they may be less inclined to buy it. If my local steakhouse tried to sell me a slice of Costco cake for $5 I'd think they were nuts! A whole cake only costs $14! But if they sold me an exclusive Costco flavor that I couldn't get anywhere else, I would definitely give it a try.

It's only the small town dynamic that makes it complicated. If everyone knows who supplied the cake then they know the "value" of the cake being served.

adven68 Posted 14 Oct 2007 , 2:09pm
Quote:
Originally Posted by daranaco


It's only the small town dynamic that makes it complicated. If everyone knows who supplied the cake then they know the "value" of the cake being served.




you're right thumbs_up.gif

schildwaster ...the restaurants are making pennies off the desserts, unless they have a bakery in the establishment. The meal and the drinks is where they're cashing in.

DelightsByE Posted 14 Oct 2007 , 2:13pm
Quote:
Originally Posted by schildwaster

this is a small town and while people will pay 5 a slice it has to be a spectacularly large dessert. I'm looking at cutting a deal for my cakes with a standing order. the most they would probably charge is 3.25 a slice or max out at 4 for a big piece of cake or pie with icecream and sauce. so looking from their standpoint, they are going to want to make how much a slice off of the cake. $1.00 or less? i hate to sell myself short if restaurants only look to make .50 cents or so. anybody have experience on restaurant mark up?




Restaurants have to include the cost of EVERYTHING into their pricing. Overhead, labor charges, etc. Remember, it costs electricity to refrigerate, wash the dishes it's served on, pay the person who's cutting it and the waitstaff to serve it.

I had a relationship this year with a restaurant who was buying my cheesecakes at $12 each for a 10" plain, which serves 12. Mind you - prior to this they were getting frozen cr*p cheesecakes from Sam's club for the same price, also I was making them on their premises using my provided ingredients and pans (standing order of 8 a week, sometimes more). They priced them on their menu at $4.29 per serving icon_eek.gif which if you go to most restaurants that doesn't seem all that much for real NY cheesecake. And I was making about 40% profit too so I was happy. But when you add it up, that's $51.48 income per cheesecake YIKES. Fast forward to this July when the dairy industry started jacking up prices. My costs went up a bit, and I notified them of new pricing - $13 a cheesecake instead of $12. Well you would have thought the world was coming to an end, and they quit buying them from me. I haven't been back there lately but a friend told me they're back to frozen cr*p cheesecakes from Sam's club again and still charging $4.29. And apparently nobody's buying them.

Restauranteurs are fickle people and it's a fickle business.

heavenlys Posted 14 Oct 2007 , 2:36pm

I supply a local restaurant with cheesecakes and dessert cakes. I made up a specialty cake that is their signature dessert and then they rotate out different ones for the seasons.
As for pricing I give them a discount of $2.00 off per cake. They are charging by the sliceso they make a ton of money off each cake. Unless their employees eat it all. Which tends to happen here. icon_biggrin.gif

I have gained new customers by having my desserts there. People will order a whole cake form me after having a slice at Clark & addison.

Don't cut your price too much. What they can buy from Sysco is frozen and made forever ago. I was at a food show and the cheesecake factory people said oh you should sell our cheesecake in your shop and I stated I make mine form scratch and he was oh I can't compete with that. Even they know fresh is best!!!

schildwaster Posted 17 Oct 2007 , 8:28pm

well i went in and met with the person that orders the cakes. She didn't even want to try them. i left samples of each cake and a pie and a cookie. The owner was going to sample them and get back to me. This would be great if I get it. They just did the super saver cards for our town and this restaurant's ad on there was a free dessert with every entree purchased. Just about everybody who's anybody get this and uses it repeatedly. Fingers crossed

shaloop Posted 18 Oct 2007 , 1:32am

I make dessert cakes for several restaurants in my area. I rent a commercial kitchen and am licensed. I thought this would be a way to make sure that I made enough to at least cover my rent and utilities and other expenses until my individual/retail sales picked up. There is good and bad to it. It does cover all of my expenses which is about $400 - 500 per month. But I don't make much after the discounts that restaurants expect. And my kitchen isn't equipped as it shoudl be and therefore I can't produce the volume in the time I'd like to. So, it took me three days to make 20 cakes this week. (which includes shopping, baking, cleaning up and deliveries.) My wholesale prices are $21 for 9" layer cakes or cheesecakes. $14 for poundcakes and $28 for signature cakes. The regular prices would be $30, $20, and $40. A restaurant has to have a minumum purchase of 4 items to get the wholesale price and be a regular customer. Regular is different for each restaurant depending on their size and whatnot. One place may order 6-8 items per week while another may order 4 once a month. But, I made about $350 sales from 20 wholesale cakes this week. But I have 3 cakes for regular individual customers on Friday and will make $100 on just those three. You have to think about your overhead, your ability to produce on a large scale if business picks up and other costs and factors to decide if it's worth it for you. If I didn't have so much overhead or could produce more product more efficiently, it woud be a much better deal. However, I have gotten several individual customers from them eating a dessert at a restaurant and asking for my card and ordering directly from me. Some are now repeat customers and have gotten additional customers from them. Just another thing to think about.

DelightsByE Posted 18 Oct 2007 , 1:46am

shaloop - if you don't mind me asking, what geographic area are you in? I am really surprised you get $21 for a 9" cheesecake, I can't even get $13 here.

shaloop Posted 18 Oct 2007 , 3:44am

Mississippi Gulf Coast. I figured out my costs and decided, based on internet research what the going rates are for a quality product, made from scratch with quality ingredients. I set my price and stuck to it. I sell my product as a quality product that you can't get at Sam's or Sysco. I have business cards and flyers and try to be as professional as I can and provided samples. I called and made appointments with owners/chefs and went from there. When I started I expected to work mostly with coffee shops and small cafes. They expect to make more per item as they usually have a lot of overhead and their product is cheap. Since I needed to find business and plan A wasn't working, I branched out. My customers are all restaurants, (nice ones, several of which I've never eaten at) except for one coffee shop that I make pound cakes for. I'm totally surprised. Some places that I've made appointments my husband has thought I was out of my league and surprise, surprise I came home with an order and a new client.
(I did have a great customer that was a local coffee shop/cafe but the owner became very ill and sold it after which it became part of a national chain and there went my customer. )

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