Costing Issues

Business By SunMamaof3 Updated 12 Sep 2008 , 2:27pm by cylstrial

SunMamaof3 Posted 11 Sep 2008 , 9:21pm
post #1 of 12

I had 2 different requests on having me doing the sheet cakes... one is for the baby shower that would feed for 35 ppl... and the other one is for a 30th anniversary gala that would feed for 200 ppl...

I do not make cake from scratch... i use box cake mix... but make my frosting from scratch...

I have always made cakes for "free" for my friends... or for my childrens birthdays etc, etc... but now this time will be my first time they will be paying me...

I know mine would be a cheaper costs compared to the bakery due to my "boxed" cake mix... but was wondering what would be an ideal costs for those 2 separate sheet cakes...

Also was wondering how much would I need to charge for a delivery fee (one is 30 miles away and the other is 90 miles away)

Your advices would be great...

Thanks!!!!!!!!

11 replies
wrightway777 Posted 11 Sep 2008 , 9:41pm
post #2 of 12

Heres how you can start:
you need to do some reconnaissance work. Since locality has a lot to do with what you can charge. Pretend you are the one that needs the cake! Call local bakeries (chain and mom&pops) be slightly vague but give them the vital information and see what they would charge "you." It would also be good to visit your fave online bakery sites (do research). Also ask what the mom&pops charge per slice basis for wedding cakes. This will at least get you started.

amy2197 Posted 11 Sep 2008 , 9:46pm
post #3 of 12

for 90 miles you need to charge at least $30 for delivery fee.

ThreeDGirlie Posted 11 Sep 2008 , 9:51pm
post #4 of 12

First: your cost isn't necessarily cheaper than a standard bakery, and they are DEFINITELY higher than a rocery store bakery - especially if you "doctor" your mixes. They buy in bulk so they can get each ingredient for less than you would pay...

Now for the question: For my first cake (due next weekend!), I first made a spreadsheet with ALL individual ingredient costs and plugged in my recipes. I know exactly what each recipe I use costs to make because I need to guarantee that I will make a profit.

Then I called around and figured out the going prices for bakery cakes and grocery store cakes in my town. Ultimately, I plan to charge as much as or MORE than the bakeries, but for my first 6 months, I decided my pricing would be smack in between the grocery prices and the bakery prices. At this pricing, I make a profilt, but not a huge amount which I know from consulting my spreadsheet. And I will tell people (as I did my friend that my first order is for) that my price is my "beginner" pricing and will go up in the next 6-12 months as I gain more experience... I don't want anyone shocked when they come back for another cake and I am charging 30% more! But it really should depend on YOUR costs and maybe have a factor for gthe going rate in your area - you wouldn't want to leave too much on the table and way undercut the bakeries even if you can and still make a profit!
Delivery fee I can't help you with.

Mike1394 Posted 11 Sep 2008 , 10:17pm
post #5 of 12

The very first thing is find out how much is it going to cost you to make them. Then do the other steps listed.

Mike

kelleym Posted 11 Sep 2008 , 11:39pm
post #6 of 12

Here's my pricing advice. Hope this helps! icon_biggrin.gif

http://www.cakeboss.com/PricingGuideline.aspx

JoAnnB Posted 11 Sep 2008 , 11:43pm
post #7 of 12

You should also consider whether it is legal to sell your home baked goods. in many states it is NOT.

SunMamaof3 Posted 12 Sep 2008 , 1:10am
post #8 of 12

There is a lady that has been making cakes here in this area for many years for schools, churches, and many clients... but she is retiring... and is tutoring me with the cake making business... I am not exactly doing the business... my goal is to do only ONE cake PER month... that is all I wanted to start out with if it is a paying job... so if she is stepping down for me to take over... obviously it is legal as she does it alot for the schools and the community... they would have to track her down wouldnt they??

lardbutt Posted 12 Sep 2008 , 1:20am
post #9 of 12

When I did my own price comparison with a doctored mix and my scratch recipe, the doctored mix actually cost me more to make. Only like a couple of dollars, but hey, that adds up!

Most people just assume a mix will cost less, but that's not always the case!

indydebi Posted 12 Sep 2008 , 1:30am
post #10 of 12
Quote:
Originally Posted by MessyBaker

Most people just assume a mix will cost less, but that's not always the case!




correct .. especially when you factor in volume buying power (heck, just switching from Sam's to Sysco cut my flour price from 15 cents a cup to less than a penny a cup ... of course this was before prices starting going all "boing!!!!" dunce.gif ) And their assembly line higher production methods that cuts their overhead costs.

Dont' assume a "cheap mix" means "a cheap cake". I tell my customers, "the cost of ingredients is the LEAST expensive part of this equation...." They aren't paying for the CAKE ... they are paying for my time and talent to create the cake of their dreams.

SunMamaof3 Posted 12 Sep 2008 , 1:49am
post #11 of 12

Oooh thank you all both for the clarification about the "boxed" cake mix... didnt realized it is actually higher than making the cake ... now I will know to price it right. icon_smile.gif

I really appreciate the feedbacks and for making me realizing and understanding...

Now I just gotta figure out and set my own prices to start with. LOL

Many thanks!!!

cylstrial Posted 12 Sep 2008 , 2:27pm
post #12 of 12

Thanks for the cake boss link. It's a great article..very helpful!

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