What Do You Charge For A Cake?

Decorating By TammyRiley Updated 1 Apr 2008 , 9:23am by AKA_cupcakeshoppe

TammyRiley Posted 29 Mar 2008 , 12:31pm
post #1 of 24

I have a few orders coming up and I've been asked for a price list. So far I have only done cakes for friends and family cheap. How do I make a price list and what is a good rule of thumb?

Thanks for any help you can provide with this.
Tammy icon_smile.gif

23 replies
emf7701 Posted 29 Mar 2008 , 2:30pm
post #2 of 24

add up your costs and then double or triple that depending on your area.

i charge $20 for a 6", $25 for an 8" $35 for a 10" or 9x13 and $70 for a 12x18 and an extra $5 for filling. hth

~erica

beachcakes Posted 29 Mar 2008 , 2:42pm
post #3 of 24

Your prices will depend on the market your area will bear, but a good idea is to price out the cost of each item/ingredient you use. It takes a little work, but it's worth it - Excel is good for this. Price it out by recipe and how many recipes of cake/BC/fondant you use for each size cake. Don't forget to add in the price of boards, boxes, ribbon, tape, etc. and electricity, gas, water. Next, what is your time worth? This is your starting point. Then you can round up/down if you wish!

kelleym Posted 29 Mar 2008 , 3:17pm
post #4 of 24

I've found that doubling or tripling your expenses won't give you near enough profit to make the cake worth your time. But beachcakes is correct, you absolutely must know how much you're spending before you can know what to charge. More of my lengthy opinions on the subject here. thumbs_up.gif

indydebi Posted 29 Mar 2008 , 3:33pm
post #5 of 24
Quote:
Originally Posted by emf7701

add up your costs and then double or triple that depending on your area.

i charge $20 for a 6", $25 for an 8" $35 for a 10" or 9x13 and $70 for a 12x18 and an extra $5 for filling. hth

~erica




$20 - 6" - 12 servings = $1.67/serving
$25 - 8" - 24 servings = $1.04/serving
$35 -10" - 38 servings = $0.93/serving
$35 - 9x13 = 24 servings = $1.45/serving
$70 - 12x18 = 54 servings = $1.30/serving


First thing I noticed is you are only charging $5 more for twice the number of servings (6" vs 8"). Smaller volume (i.e. smaller cakes) are generally more per serving because you have to cover overhead. A disposable decorating bag costs the same no matter if you are using it to decorate a 6" cake or a 12" cake. The cost to run your mixer costs the same no matter if you make icing for a 6" cake or a 12" cake.

Your price per serving seems to be all over the board with no rhyme or reason to it. How did you arrive at these numbers? The system of "Oh, this sounds good!" is not a very scientific one. icon_lol.gif

The 'cost times 3' method is useless and I don't know how anyone does that and makes a profit. If I went by that system, I'd be selling wedding cakes for 100 for about $95 instead of $300. I'd be selling a dozen snickerdoodle cookies for about $0.60/dozen instead of $6.00/dozen. I think where most people screw up with that system is they figure the cost of their MATERIALS and totally overlook the other costs ... payroll, utilities, insurance, etc.

I charge $3/serving for non-sheet cakes. That means my 10" cake that serves 38 (rounded to 35) sells for $105. I'm not even turning on my oven for a $20 cake. (see my other thread where I sent a bride to walmart for a "token" wedding cake for the bridal table. It's not worth my time.)

tippyad Posted 29 Mar 2008 , 3:35pm
post #6 of 24

A word of advice...stop selling cheap to friends and family. They'll expect it every time and it's a hard thing to get out of. Your time is valuable.

Ditto to all the above comments. thumbs_up.gif

KayDay Posted 29 Mar 2008 , 3:43pm
post #7 of 24

I do NOT preheat my oven for less than $100.00 was my old rule before my shop. And with cakes this still holds true for me. Only very upscale birthdays and anniversaries and weddings. I start at 3.50 per on my basic designs. White cake with BC. And go up from there.

emf7701 Posted 29 Mar 2008 , 5:25pm
post #8 of 24

[/quote]Your price per serving seems to be all over the board with no rhyme or reason to it. How did you arrive at these numbers? The system of "Oh, this sounds good!" is not a very scientific one. icon_lol.gif

The 'cost times 3' method is useless and I don't know how anyone does that and makes a profit. If I went by that system, I'd be selling wedding cakes for 100 for about $95 instead of $300. I'd be selling a dozen snickerdoodle cookies for about $0.60/dozen instead of $6.00/dozen. I think where most people screw up with that system is they figure the cost of their MATERIALS and totally overlook the other costs ... payroll, utilities, insurance, etc.

I charge $3/serving for non-sheet cakes. That means my 10" cake that serves 38 (rounded to 35) sells for $105. I'm not even turning on my oven for a $20 cake. (see my other thread where I sent a bride to walmart for a "token" wedding cake for the bridal table. It's not worth my time.)[/quote]

No way could I ever get $105 for a 10" cake! That's not what things go for where I live. And from what I've been told, I'm one of the more expensive bakers. Plus, I have no payroll, no insurance (yet)... it's just me making a few cakes a month.

TheButterWench Posted 29 Mar 2008 , 10:40pm
post #9 of 24

quote]


No way could I ever get $105 for a 10" cake! That's not what things go for where I live. And from what I've been told, I'm one of the more expensive bakers. Plus, I have no payroll, no insurance (yet)... it's just me making a few cakes a month.[/quote]

not yet but you must set goals or then it's just a hobby and then you shouldn't charge for them.

emf7701 Posted 29 Mar 2008 , 10:58pm
post #10 of 24
Quote:
Originally Posted by TheButterWench

quote]


No way could I ever get $105 for a 10" cake! That's not what things go for where I live. And from what I've been told, I'm one of the more expensive bakers. Plus, I have no payroll, no insurance (yet)... it's just me making a few cakes a month.




not yet but you must set goals or then it's just a hobby and then you shouldn't charge for them.[/quote]


yes, i started out as a hobby baker.. i've slowly worked my way up to being "a business". i've just secured my first wedding cake order... but i will never charge $105 for a simple 10" cake. that IMHO is ridiculous. i wouldn't pay that and i don't expect anyone else too.

and for the record, when did this start as an attack on me and my pricing? the OP wanted help with pricing and so that's what i did - offered her what i know and what has worked for me. just because you can get tons of $$$ where you live, doesn't mean everyone else can. if you can, good for you... but you don't have to tick me off and make me feel like crap because that's not the going rate where i live.

that said, i'm done with this post, won't be watching it anymore. if you've got a retort/comment/something to say, then pm me.

mommyle Posted 29 Mar 2008 , 11:30pm
post #11 of 24

Ok. Let's just take a breath before we all get our knickers in a bunch. I agree with Debi that you need to start from somewhere and have a good "reason" for what you charge. $xx for a xx' cake might indeed be what you can get in your area, but you also need to be able to explain "why" to yourself and your clientel. My prices are right between the specialty shop price and the grocery store price. I figured out what they each charge as a base price and went accordingly. So, my starting price is $2.00 a serving for regular cake and regular buttercream. then I go up $.050 per serving after that. So, a regular choc. cake with choc. ganache is 2.50 per serving but carrot cake with cream cheese icing is $3.00 per serving. With the thought, of course, that I can always charge more if the client is a PITA. I also charge WAY more for a sculpted cake! For those I charge by the amount of cake that I need to bake to make the shape, even if I only end up using half the cake that I made.
Now, to get to know how expensive your cake was to make to begin with, here is my excel sheet that my DH made up for me. PM me if you have questions, and I'm sure you will.
HTH

KoryAK Posted 30 Mar 2008 , 12:22am
post #12 of 24

I don't think that Indydebi was trying to attack you and we all know that pricing really varies from area to area... but her point holds true... when you break each of your prices down to a "per serving" they are all over the map. Your customers SHOULDN'T be able to get twice as much cake for an extra $5. She was just trying to help icon_smile.gif

TheButterWench Posted 30 Mar 2008 , 2:04pm
post #13 of 24

and so was I. What I meant was for the OP to buckle down and get what she or he is worth.

It doesn't matter that in your area you're not able to get oh lets say for saying sake $100.00 for your cake, but I'm sure that you're paying the same for sugar, butter and eggs as the rest of us Nationwide are (more or less) and minimum wage is the same everywhere, so

so the only big varialble is the "Buyer's Market" and our own personal skill level and those are the 2 largest things to trow in the pricing pot.

JMHO

Trixyinaz Posted 30 Mar 2008 , 4:39pm
post #14 of 24

Thanks for asking this question, b/c I am needing to figure this out myself and don't want to sell myself short. Which I did for this first paid order - I just didn't know anything.

How much do you pay yourself or calculate into the per piece serving? For example, I just made a carrot cake from scrath with cream cheese icing. Here's my breakdown:

Cake: $7.95 x 2 (10" double layer) = $15.90
Icing: $17.35
Supplies: $1.50
Electricy/Gas: $3.48

Total w/o my hourly wage: $38.23

It took me about 6 hours or so to finish this job from start to end, including clean up and washing dishes. I'm hoping that I'll get better and faster at this.

So with all the info, how would I calculate how much to charge? What do I figure in for my "salary". I'm new at this so do I factor in minimum wage per hour? If I paid myself what I make at my day job, no one would be able to afford my cakes.... icon_lol.gif

Sorry to hijack your post.

indydebi Posted 31 Mar 2008 , 3:14am
post #15 of 24

Trixy, I'm assuming this $38 is your selling price. Even if you only gave yourself $10/hour = $60 + $38 = $98 for a 10" cake.

A 10" cake serves 38. $98/38 = $2.57/serving.

Not unreasonable.

For those who are a little shocked at my $105 pricetag, if you are selling wedding cakes for $3/serving, then you are selling that middle 10" tier for $105 (+/-).

If you are selling cakes for $2.50/serving, you are selling that middle 10" tier for $90-$95.

Just using the number in the above post as an example only, no one should be selling a 10" middle tier of a wedding cake for $0.93/serving. That would be $93 for a wedding cake to serve 100. icon_confused.gif

I appreciate those who supported my post. It was not an attack on anyone's pricing .... those who know me, know I do numbers and sometimes decorators don't really break it down to see what the price impact is. I was only trying to illustrate it by breaking it down for the benefit of the OP who had a question on how to do pricing. I apologize if it was taken the wrong way, but I assure you, no negative statement was intended.

kelleym Posted 31 Mar 2008 , 3:35am
post #16 of 24
Quote:
Quote:

It took me about 6 hours or so to finish this job from start to end, including clean up and washing dishes. I'm hoping that I'll get better and faster at this.

So with all the info, how would I calculate how much to charge? What do I figure in for my "salary". I'm new at this so do I factor in minimum wage per hour? If I paid myself what I make at my day job, no one would be able to afford my cakes....




Well, in the end, you can only charge what the market will bear. That's why it's so important to call around to other custom bakeries and find out what the going rate per serving in your area is.

If you find that to make a decent profit you have to charge more than what the market will bear, you need to look at reducing your costs: buying food wholesale, working faster to reduce the amount of time you spend per cake, etc.

Trixyinaz Posted 31 Mar 2008 , 10:39am
post #17 of 24

Deb = thanks! The $38 for this 10" carrot cake was the cost of the cake and supplies - no mark up. Do you mark up your cake, then add your hourly rate on top of that? Thanks!

Vicki

AKA_cupcakeshoppe Posted 31 Mar 2008 , 11:16am
post #18 of 24

my brother, who is an accountant, made a spreadsheet for me too. for my labor/markup he placed it in at 20% additional of all the costs. i find it reasonable.

is it?

Trixyinaz Posted 31 Mar 2008 , 12:54pm
post #19 of 24

Kelly - thanks. I'll need to call around to the bakeries and find out the cost per servings to get an idea of what the average rate is in my area. This cake was an expensive cake. I made a carrot cake from scratch and it had lots of things in it. I;'m at work and trying to recall the most expensive thing...probably the nuts. However, the icing was incredibly expensive. I did go to the regular grocery store for all the ingredients. My mom even said that if I go to Costco, I should be able to save money by buying in bulk.

I told my DH that as soon as I make $100, I'm going to buy Cake Boss. He just laughed. The software looks GREAT. something I could see myself needing in the future --- hopefully the near future!

Cupcakeshoppe - Is the 20% for your labor or do you take the cost of your cake, supplies and labor and then add 20% to get your selling price? See, that is where I get confused. LOL....not hard to do. LOL

Thanks.

mbh724 Posted 31 Mar 2008 , 1:23pm
post #20 of 24

How can you have an hourly charge for labor when you are still new to this and slow? I would be making way more money than someone more skilled than me because they could do it so much quicker. I think you have to go by a price per serving guide, adding in for extras. I also think you have to charge more per serving for smaller cakes.

FromScratch Posted 31 Mar 2008 , 1:35pm
post #21 of 24

A 10" cake would cost $120 if you purchased it from me. No applogies from me either. It's takes time and skill and raw ingredients and time and time and time.. you get my point. I don't care if it cost me $10 to make that cake.. I am getting covered for my time and knowledge to make that cake. My time is what costs you. I am not going to spend hours away from my family for pennies. I wouldn't work outside of my home for minimum wage and I am not making less than minimum wage when working in my home.

I see the prices listed.. and I have to chuckle (and not in a spiteful way.. just to keep from getting upset). It would cost me what some are charging for their end product in raw ingredients alone to make a cake. So if I don't charge what I do.. I make very little.. and it's completely not worth my time.

People come to you for your expertise.. if they could/wanted to do it themselves they would. Why put yourself through all of that for next to nothing? The way I see it no one should charge less than $2/serving (going by wilton servings). And if you are goign to sell your product on the cheap because you aren't confident in your product you need to either practice more before you are selling so you do have that confidence or tell people why you are charging so much less and let them know how much it would cost if you were charging full price.

I get so tired hearing "I would never pay that price for a cake". You are NOT your customers.. just because you wouldn't pay that for a cake doesn't mean that there aren't people out there who will. And if you decide to sel at WalMart prices.. don't cry when you make nothing for a profit.. you did it to yourself really. No one should make $10 after subtractions for ingredients for hours of work.

This isn't an attack on anyone in particular.. it isn't an attack at all. Just a point of view from someone who is in this as a business.. who cannot fathom the idea of underselling herself.. nevermind everyone else around me in this business too.

Trixyinaz Posted 31 Mar 2008 , 2:11pm
post #22 of 24

Being new and slow to this doesn't mean I can't get paid for the time/labor that is involved in making a cake. In the beginning I don't expect to get paid for all the time it takes me b/c that wouldn't be fair. If it takes me 6 hours today to make this cake, I'm hoping by this time next year, I can shave off an hour or two from that time. That's why I'm here asking how you determine what to charge per slice - do you add in labor, do you just mark-up the cost of the cake, how do you figure out what to charge per slice? IndyDeb explained it very well in her post. And I really like how she broke it out.

Cost of cake ingredients and supplies: $38
5 hours at $10 per hour for labor: $50
Total: $88
Cake serves 35 people
$88 / 35 = $2.50 per slice (from what I've seen on here and what Deb said, that is reasonable)

So based on your comment, I shouldn't get paid an hourly salary and just charge what? I need to do some leg work and find out what the bakeries are charging per slice in my area. I don't want to over charge, but I also don't want to undersell myself.
That was great advice from Kelly. THANKS!!! I came here asking how GY prices out their cakes and how much GY generally adds in for labor, if you do.

I'm not new to baking so my skills really can't get much faster at that. I'm new to decorating and the more I decorate, the faster I will become. It's not rocket science to figure that out. So why should I not include labor into my price now? If I don't, clients will expect the non labor prices going forward and I will have a hard time raising my prices. Hence, making it difficult to make a profit.

So with all that said, I hope you can see how I can have an hourly charge for labor included into the cost per slice being new and slow. People with no experience get jobs all the time. They don't work for free until they gain the experience and they certainly don't work for $1 an hour either.

I charged the guy I work with $45 for this cake, which cost me $38 to make. When all was said and done, I made $7. That's $1.16 per hour for labor. Seems a bit low if you ask me. And, that equates to $1.29 per slice. I am almost certain the bakeries near me aren't charging that low.

Now I need to work on lowering my costs and time it takes to make and decorate the cakes.

And that for the tips on charging extra for the xtras. I'm assuming you are refering to fondant, gumpaste, etc? Correct?

Trixyinaz Posted 31 Mar 2008 , 2:26pm
post #23 of 24

Jennie - we must have cross posted. Your post makes perfect sense to me. I am trying to get into this business. I don't need another hobby and if I charge as if it is a hobby, I'll never be successful running a business when I plan to open one next year. I appreciate your candor and honesty. Your points were well taken and not taken as an attack. Thanks for taking the time to write all you did. I appreciate all of it. While I am new, I am confident in the product I produce. I'm a perfectionist and am practicing practicing and practicing. I'm taking classes for decorating. I'm really taking this seriously. I want to be great at this....I don't want another hobby!

Thanks!

Vicki

AKA_cupcakeshoppe Posted 1 Apr 2008 , 9:23am
post #24 of 24
Quote:
Originally Posted by Trixyinaz



Cupcakeshoppe - Is the 20% for your labor or do you take the cost of your cake, supplies and labor and then add 20% to get your selling price? See, that is where I get confused. LOL....not hard to do. LOL

Thanks.




it's 20% of all the ingredient costs and my incidentals (gas, use of my mixer and other equipment, electricity, dishwashing soap)

I don't know who uploaded the quote excel file on here but I got it and it looks pretty good. thanks!

Quote by @%username% on %date%

%body%