Pricing Small Orders

Business By springlakecake Updated 14 Nov 2008 , 3:32pm by MacsMom

springlakecake Posted 13 Nov 2008 , 4:40pm
post #1 of 20

I will be opening shop (legal separate home bakery) in the next couple of months (I hope!). In the mean time I am trying to figure out details such as pricing.

I just had this senario come up last week. It is for a friend of my mother, so it isnt a big deal now. For future I want to figure out serving and pricing minimums.

She wants 2 cakes for her twin grandchildren (boy/girl). Only to feed 20 people so approximately 10 servings each cake. Different designs, different cake filling and flavor. Say I charge $2.50 per serving= $50. It is way more work than one cake to serve 20 people for $50. Right?

I was thinking of saying that orders over $75 have complimentary flavor change between tiers/multiple cakes, otherwise an additional fee of $5 or $10 would be added.

Any suggestions? Ideas?

19 replies
MacsMom Posted 13 Nov 2008 , 4:49pm
post #2 of 20

I would stick with one method of pricing. For me, per serving works better than per cake, but I state $4 to $5 per serving "based on the complexity of the design".

That way, when you sell a cake on the plain side that serves 20 and another that requires tons of detail, you can explain to the customer why there is a difference in price for the same size cake.

I don't charge extra for fillings, but I do charge more for alcohol cakes.

springlakecake Posted 13 Nov 2008 , 5:09pm
post #3 of 20

I guess what I am getting at is that it is almost like two different orders. I have to make two different cake flavors, two designs, two fillings. For only $50, that is a lot of work. It is a lot more cost and time effective to make one cake for 20 people for $50. That is why I was thinking of adding an extra charge for small cakes if they want different flavors. KWIM? This is an extreme example but I wouldnt sell someone a dozen cupcakes in 4 flavors.

I guess another way around it would be to raise my minimum order to something like $75, however, I am just getting started so i don't really want to turn down smaller stuff.

chutzpah Posted 13 Nov 2008 , 6:05pm
post #4 of 20

I won't do a cake smaller than an 8".

It takes just as long to make a cake for 20 people as a cake for 10. Just because the cake is smaller doesn't mean there are fewer steps to making/decorating it.

I'd much rather do one cake for $100 than 5 cakes for $20 each.

MacsMom Posted 13 Nov 2008 , 7:54pm
post #5 of 20

Having so many flavors and fillings to make would constitute your right to say, "since it more complex to make these two different cakes, I have to charge [this much]."

That's what I like about having the range. You could state that your cakes are $2.50 to $3.50 per serving, to be determined upon consultation. Several bakeries don't goive out pricing until a meeting has been arranged - or at least details have been given.

springlakecake Posted 13 Nov 2008 , 8:59pm
post #6 of 20

Thanks for the advice. It gives me something to think about!

FromScratch Posted 13 Nov 2008 , 9:11pm
post #7 of 20

I won't do less than an 8" cake (as a stand alone cake) either.. and my minimum order is $100.00. It's just not worth it to me to do anything less.

MacsMom Posted 13 Nov 2008 , 9:31pm
post #8 of 20
Quote:
Originally Posted by jkalman

I won't do less than an 8" cake (as a stand alone cake) either.. and my minimum order is $100.00. It's just not worth it to me to do anything less.




Oh I agree! thumbs_up.gif

sweetcravings Posted 13 Nov 2008 , 11:18pm
post #9 of 20
Quote:
Originally Posted by jkalman

I won't do less than an 8" cake (as a stand alone cake) either.. and my minimum order is $100.00. It's just not worth it to me to do anything less.




So, if someone calls do you just tell them upfront..my smallest cake is 8"..it serves..?...and starts at 100.00 and goes up from there? What kind of reaction do you get? I was thinking of doing something similar, as you said to do small cakes isn't worth my time either.

MacsMom Posted 13 Nov 2008 , 11:41pm
post #10 of 20

No. It would be more like, "Minimum order is $100. My cakes are $4 to $5 per serving, depending on the complexity of the design. I can create a cake to serve 10 guests if you wish, but it will be $100."

cylstrial Posted 13 Nov 2008 , 11:55pm
post #11 of 20
Quote:
Originally Posted by MacsMom

No. It would be more like, "Minimum order is $100. My cakes are $4 to $5 per serving, depending on the complexity of the design. I can create a cake to serve 10 guests if you wish, but it will be $100."




LOL. It will be so nice when I get to that point! I can't wait... one day! (Hopefully sooner than later)..

MacsMom Posted 14 Nov 2008 , 12:19am
post #12 of 20

At first I started with the same thoughts, but watching Suzy Ormon one night she asked a gal who was starting her architectural business how much she wanted to get for her work. Not how much she thought she start with, but how much she wishes to recieve 5 years from now.

Suzy told her that if she starts charging any less right off the bat, then she will find it very difficult to increase her prices to meet that desired amount. If her goal was to get clients who could afford those prices, then there is no reason she should start her business charging any less.

You may not think you are worth the prices you want because you are new, but you are.

If you find it hard to charge more as a new business, you can always offer "introductory" pricing or discounts for first orders. That way your clientelle will understand that the price they are paying is not the same price they will recieve when they come back for their next event.

janebrophy Posted 14 Nov 2008 , 12:29am
post #13 of 20
Quote:
Originally Posted by MacsMom

At first I started with the same thoughts, but watching Suzy Ormon one night she asked a gal who was starting her architectural business how much she wanted to get for her work. Not how much she thought she start with, but how much she wishes to recieve 5 years from now.

Suzy told her that if she starts charging any less right off the bat, then she will find it very difficult to increase her prices to meet that desired amount. If her goal was to get clients who could afford those prices, then there is no reason she should start her business charging any less.

You may not think you are worth the prices you want because you are new, but you are.

If you find it hard to charge more as a new business, you can always offer "introductory" pricing or discounts for first orders. That way your clientelle will understand that the price they are paying is not the same price they will recieve when they come back for their next event.




Wow, although I think we've all heard this advice before, I have never heard it so well worded. Really great advice, makes total sense!!!

jennifer7777 Posted 14 Nov 2008 , 12:43am
post #14 of 20
Quote:
Originally Posted by merissa

I guess what I am getting at is that it is almost like two different orders. I have to make two different cake flavors, two designs, two fillings.




Exactly...it basically is 2 orders. And of course, it's always easier to make one cake, then several. But since you are charging per serving, you are getting your fair payment for both cakes. It's how you look at it...maybe it's the fact that you know both cakes are for the same person. If they were for 2 different people, then would that raise an issue? But, it's good to think about this, and like other posters said, think about if you want a minimum serving/amount for your cakes.
It's about the amount of work you want to do for your dollar.

indydebi Posted 14 Nov 2008 , 1:50am
post #15 of 20

Caller: I'd like a sheet cake to serve 10.
Debi: The smallest sheet I do serve 35 and it's $50. Layered and tiered cakes are a little higher in price.

i don't know gang .... I can't call dominoe's or pizza hut and get ONE slice of pizza. At least not around here. Minimums are not new.

FromScratch Posted 14 Nov 2008 , 3:10am
post #16 of 20

Complete ditto to MacsMom.. when I started out it was pretty much the same as it is now. I never had beginner pricing. I knew what I wanted to charge and I charged it. My goal is to make high-end boutique-type cakes and I charge accordingly. I didn't want to run into the resistance when I raised my prices because I felt I was in the business long enough to warrant it.

We are our own worst enemies sometimes.. not feeling worthy.

springlakecake Posted 14 Nov 2008 , 1:16pm
post #17 of 20

[quote="jennifer7777
Exactly...it basically is 2 orders. And of course, it's always easier to make one cake, then several. But since you are charging per serving, you are getting your fair payment for both cakes. It's how you look at it...maybe it's the fact that you know both cakes are for the same person. If they were for 2 different people, then would that raise an issue? But, it's good to think about this, and like other posters said, think about if you want a minimum serving/amount for your cakes.
It's about the amount of work you want to do for your dollar.[/quote]

I don't think I would do an order for $25. So yes, it is an issue. I was thinking of having a minimum of $40 (an 8 inch.) However, now after I am reading your helpful posts, maybe the minimum should be higher...I know I am good..LOL! I probably wouldnt mind making two different 8 inch cakes for $90 or $100. It is the small cakes that are the problem.

sweetcravings Posted 14 Nov 2008 , 1:52pm
post #18 of 20
Quote:
Originally Posted by MacsMom

No. It would be more like, "Minimum order is $100. My cakes are $4 to $5 per serving, depending on the complexity of the design. I can create a cake to serve 10 guests if you wish, but it will be $100."




Is this for fondant or buttercream covered or both?

dinas27 Posted 14 Nov 2008 , 2:19pm
post #19 of 20

You could set a minimum number of total servings - 24 (8 inch cake) or a dozen cupcakes AND set a minimum number of servings per flavor.

For example: cupcakes - one doz per flavor, cake - 24 servings per flavor. Your minimum would depend on your recipe yield.

So in this case - your minimum servings is 24 - she has to pay for 24 servings not 20. If she would like 2 cakes :2 6" (same flavor) OR 2 8" (different flavors) OR she could order 2 doz cupcakes (2 flavors). Doing 2 6" might still be a little PITA - you would have to decide if it was worth it for you to do.

MacsMom Posted 14 Nov 2008 , 3:32pm
post #20 of 20

I only do fondant. Icing tips and I just don't get along icon_cool.gif , lol.

Merissa, you do amazing work - you should raise your prices!

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