My Rant On Cake Pricing

Decorating By Ballymena Updated 14 Mar 2009 , 6:05am by Ballymena

Ballymena Posted 10 Mar 2009 , 6:48pm
post #1 of 79

Pricing is a hard thing to figure out. The biggest mistake cake decorators and other crafters make is not charging enough for our time, that equates to not putting value on ourselves and that's an error we often make. Get over that, we are valuable! Think of all the time we have put into getting trained to do these wonderful cakes. That is worth a lot of cash even if we trained ourselves. Look at the equipment we've invested in, look at our power bill for baking. Not charging enough makes it difficult for other decorators who do charge properly. A customer will check prices and wonder why one is so expensive compared to the person that does not charge enough for their time. Often the customer will order from the less expensive one only because they are thinking of their own pocket book and don't really care about the energy you put into this creation.
Come on fellow cake mates, lets quit under-valuing ourselves and all get on an even plane. I know different areas seem to want to pay less or more than others but maybe they just need to be educated, if there isn't a choice they will accept it. Band together and form equality in the pricing structure for your products.

There, I've had my rant. I'm looking forward to your opinions on this.

78 replies
MichelleM77 Posted 10 Mar 2009 , 6:53pm
post #2 of 79

I agree with you.

I'm priced to the lower end of the middle of the road, if that makes sense. I do things the grocery store and some store bakeries won't do. Doesn't matter. Unfortunately it all comes down to price.

I'm on a local mom's board and when someone asked for a referral for a birthday cake, 80% of them recommended Sam's Club or the grocery store. The other 20% recommended local bakeries that charge $0.75 to $1.50 per slice. I still can't compete with them.

So what are we to do?

chutzpah Posted 10 Mar 2009 , 6:57pm
post #3 of 79

As I always say...

Raise the bar for yourself and you raise it for cake decorators all over.

If you don't value your own work, no one else is going to value it, either.

Ballymena Posted 10 Mar 2009 , 7:01pm
post #4 of 79

I let people know every chance I get that I use real butter, real cream, special fillings, again made with real products, which is something most grocery stores don't do. I make my own cakes and don't use commercial mixes which again almost all grocery stores do.

indydebi Posted 10 Mar 2009 , 7:23pm
post #5 of 79

to add to what chutz said.....

Your true value depends entirely on what you are compared with.
---- Bob Wells

If you put a small value upon yourself, rest assured that the world will not raise your price.
--- Unknown

In the modern world of business, it is useless to be a creative original thinker unless you can also sell what you create. Management cannot be expected to recognize a good idea unless it is presented to them by a good salesman.
---- David M. Ogilvy

Letting your customers set your standards is a dangerous game, because the race to the bottom is pretty easy to win. Setting your own standards, and living up to them, is a better way to profit.
-----Seth Godin


As far as 80% recommending the grocery store cakes, a good question would be "Well, do you want good or do you want cheap? Because you can't have both."

shelly-101 Posted 10 Mar 2009 , 7:39pm
post #6 of 79

well put indydebi......I don't sell my cakes yet but hope to one day i have had alot of people ask me to sell them cakes. people don't relize how much goes into a cake all the hard work and they have to remember that they are getting a specialty cake not just any old cake. You will always get those people that don't want to pay you what your time is worth and those are the people that arn't worth making a cake for let them go some where else and get a cake and pay 30.00 bucks for it you get what you pay for.

The other day i posted a question on how much to charge for a certian cake and I about hit the floor when i found out how much i could get for my cakes I showed my husband the post as well and we have deciced to get the ball rolling.

MichelleM77 Posted 10 Mar 2009 , 7:43pm
post #7 of 79

indydebi....some of the comments were that those are the best cakes, that they get the best compliments from the cakes they buy at Sam's Club!!! I can't win.

As far as your quote from David M. Ogilvy, I might as well stop being a creative original (at least in the world of grocery store cakes) because I can't sell what I create. Now if that isn't depressing, I don't know what is.

luvsfreebies72 Posted 10 Mar 2009 , 7:53pm
post #8 of 79
Quote:
Originally Posted by MichelleM77

I agree with you.

I'm priced to the lower end of the middle of the road, if that makes sense. I do things the grocery store and some store bakeries won't do. Doesn't matter. Unfortunately it all comes down to price.

I'm on a local mom's board and when someone asked for a referral for a birthday cake, 80% of them recommended Sam's Club or the grocery store. The other 20% recommended local bakeries that charge $0.75 to $1.50 per slice. I still can't compete with them.

So what are we to do?




I'm probably about to insult someone here but: tapedshut.gif @ Sam's Club, costco and grocery store cakes. Seriously, I find them to taste really nasty. I had this same thing happen with a niece. She ordered her daughter's birthday cake from Albertson's. I about fainted. I told her "Hello, I do CAKE". She said she likes the albies cakes... It looked like heck. I think even she could have done a better job - and she doesn't bake. When I was offered a piece, I declined. icon_biggrin.gif

luvsfreebies72 Posted 10 Mar 2009 , 7:54pm
post #9 of 79
Quote:
Originally Posted by MichelleM77

I agree with you.

I'm priced to the lower end of the middle of the road, if that makes sense. I do things the grocery store and some store bakeries won't do. Doesn't matter. Unfortunately it all comes down to price.

I'm on a local mom's board and when someone asked for a referral for a birthday cake, 80% of them recommended Sam's Club or the grocery store. The other 20% recommended local bakeries that charge $0.75 to $1.50 per slice. I still can't compete with them.

So what are we to do?




I'm probably about to insult someone here but: tapedshut.gif @ Sam's Club, costco and grocery store cakes. Seriously, I find them to taste really nasty. I had this same thing happen with a niece. She ordered her daughter's birthday cake from Albertson's. I about fainted. I told her "Hello, I do CAKE". She said she likes the albies cakes... It looked like heck. I think even she could have done a better job - and she doesn't bake. When I was offered a piece, I declined. icon_biggrin.gif

luvsfreebies72 Posted 10 Mar 2009 , 7:55pm
post #10 of 79
Quote:
Originally Posted by MichelleM77

I agree with you.

I'm priced to the lower end of the middle of the road, if that makes sense. I do things the grocery store and some store bakeries won't do. Doesn't matter. Unfortunately it all comes down to price.

I'm on a local mom's board and when someone asked for a referral for a birthday cake, 80% of them recommended Sam's Club or the grocery store. The other 20% recommended local bakeries that charge $0.75 to $1.50 per slice. I still can't compete with them.

So what are we to do?




I'm probably about to insult someone here but: tapedshut.gif @ Sam's Club, costco and grocery store cakes. Seriously, I find them to taste really nasty. I had this same thing happen with a niece. She ordered her daughter's birthday cake from Albertson's. I about fainted. I told her "Hello, I do CAKE". She said she likes the albies cakes... It looked like heck. I think even she could have done a better job - and she doesn't bake. When I was offered a piece, I declined. icon_biggrin.gif

shelly-101 Posted 10 Mar 2009 , 8:03pm
post #11 of 79

The other day i posted a question about how much i should charge for a certian cake. I about hit the floor when i found out how much i could be getting for my cakes it made me that much more excited to get a business started...I was defantly selling myself short on what i could get for my cakes maybe like me some of us just don't know how much to charge It's not that i don't value myself i just really did not know how to charge. I will have to stay at the lower end of the scale because we only have walmart and smiths to get cake from so to be able to compete with them i would have too.

luvsfreebies72 Posted 10 Mar 2009 , 8:05pm
post #12 of 79

woa - I do not know why that posted 3x. I clicked submit once and one time only. didn't refresh or anything. icon_surprised.gif

MichelleM77 Posted 10 Mar 2009 , 8:11pm
post #13 of 79

My husband's family does the same thing. I have never made a cake for his family. They never ask. They go to the grocery store. icon_sad.gif

patticakesnc Posted 10 Mar 2009 , 8:12pm
post #14 of 79

luvs don't worry about it. I have noticed CC freezing up the past couple days. Thought is was my laptop but noticed it was only on this site so I don't think it was you.....

michellesArt Posted 10 Mar 2009 , 8:24pm
post #15 of 79

i do agree that we (and typically women in general) under charge for our services in order to be "competative" but i do know that being in canada vs the states makes a difference (gas, electric, water prices vary from state to state and even city to city i imagine. don't you think it's more expensive to live in NYC and run a business than say somewhere in indiana? that does have to be taken into consideration. and what about a high end, professional like Zoe Clark (UK) or DUff?(aren't some people astonished about how much he charges for some of his cakes) the level of cakes compared to a novice is completely a factor. i find that i still struggle with how much to charge per slice and there are other factors that i consider as well like is it completely covered in fondant, am i making a topper? those are additional charges

MamaMayhem Posted 10 Mar 2009 , 8:34pm
post #16 of 79
Quote:
Originally Posted by Ballymena

I know different areas seem to want to pay less or more than others but maybe they just need to be educated, if there isn't a choice they will accept it.




I hope I did that quote thing correctly, my first time.

Anyway, I'm just beginning to learn to decorate so I may not be the best judge, but here's my 2cents. I agree with Ballymena but as much as we'd like to set a flat fee we can't. Differing costs of living are very real things. What costs 10 bucks in my little town would probably cost 20 or more in NYC, and Hubby would probably make more for the same job in a bigger town. So maybe the thing to do would be to set a scale. Something like, take what your local Walmart/Costco charges and add 2.50 a serving or more if you have overhead. What do you think? icon_smile.gif

indydebi Posted 10 Mar 2009 , 8:44pm
post #17 of 79
Quote:
Originally Posted by MamaMayhem

So maybe the thing to do would be to set a scale. Something like, take what your local Walmart/Costco charges and add 2.50 a serving or more if you have overhead. What do you think? icon_smile.gif




I think that even suggesting something like that could be construed as price fixing, which has some pretty severe federal penalties. I also think that arbitrarily setting a "scale" does not set a good pricing structure based on each person's overhead and expenses. Especially when you consider that (based on an old thread on here) it was revealed that Sam's/walmart gets their frozen cakes at about 50 cents each ... none of us can compete with supply-pricing like that.

Michelle, I sure understand the problem with those who say that grocery store cakes are "the best". To me, it's a reflection of what they're used to. One of the things we made SURE to teach our children, when they were growing up, was exposure to what "nice things" really were. I didn't want my children growing up thinking that going INSIDE Mcdonalds' for dinner was a big night on the town. icon_eek.gif

If it's all you've ever had, then it's all you'll ever know. icon_sad.gif

sweetpeachcakes Posted 10 Mar 2009 , 9:03pm
post #18 of 79

Here are my 2 cents on pricing: I live in a very small town with a Wal-Mart and one other local grocery store that sells decorated cakes...oh...and Dairy Queen. I own a cake supply store that I inherited from my mother and grandmother. We have been open 30 years. I sell to a lot of supplies for all types of cakes and here is what I hear from a lot of beginning bakers: "I go in the hole on most of my cakes." This includes me. I am just beginning to actually make cakes, most of them with buttercream and covered in fondant and fondant modeling. I sold one last week (Little Einsteins Rocket Cake) for only $40. Argh! I really could have beat myself, but I made up for it somewhat. I told the mother that my cost would be around $35 for a regular round birthday cake, so she only planned on paying that. When she brought in the picture of what she wanted, I knew it would cost more and take a lot of time. In the end, it cost $45 to make (remember, I get my supplies at wholesale cost) and took 12 hours. In all, I should have charged $140. My cousin makes similar cakes in Atlanta and would have easily gotten that out of the cake. Because of the store I own, I don't sell many cakes--I don't want to compete with the bakers to whom I sell supplies. The mother, after paying the $40, stated, "oh! you'll get lots of customers for cakes like this at this price! This is wonderful!"...."No,"...i said. Please don't advertise. "I am just learning and will start charging for my time if I do many more....so plan on paying a little more next time!" Now, to back up, the mother came to me because she knew I could do fondant cakes and she thought PUBLIX in the next town charged too much for their cakes. I don't plan on selling many more cakes....but I sure would like to educate the public on just how much the artistic talent of bakers and decorators is worth!

JodieF Posted 10 Mar 2009 , 9:18pm
post #19 of 79

I don't sell cakes, although I wish I could! There no licensing for home bakers in Illinois. But, honestly, until I started decorating I had NO idea how much time went into it or what the cost of ingredients could be for decorated cakes.

For example, the last cake I posted...the chocolate wrap cake I made my son. It was a 6, 9, 12, 2 flavors of cake, all that chocolate, all that fruit. So, 70-80 servings. Most of you would have charged what? $250? $300? More??? Even if I WANTED to buy that cake I couldn't afford it, no matter how good it was.

I think it doesn't occur to most folks to spend that much on a cake, especially if it's not a wedding cake. BELIEVE me, I know it's worth every penny, but that's the reality of it.

Jodie
LL

chutzpah Posted 10 Mar 2009 , 9:22pm
post #20 of 79

Geez, Jodie, what a gorgeous cake! That must have taken loads of work!

indydebi Posted 10 Mar 2009 , 9:23pm
post #21 of 79

Jodie, what a luscious looking cake!

Wilton wedding chart says this serves 100. With the chocolate work, I would have charge my fondant rate of $4.50/serving PLUS separate charge for the additional fruit (especially if it's out of season).

Know what you mean though ... my own daughter tells her friends, "Good thing my kids have a gramma who can make those cakes because *I* can't afford my mom's cakes either!" icon_lol.gif

JodieF Posted 10 Mar 2009 , 9:29pm
post #22 of 79

Thanks Chutzpah and Indy... icon_biggrin.gif That's high praise coming from you two! The cake wasn't hard actually....just messy! There was chocolate everywhere! I'm a pretty neat baker, but it was all over....in my hair, on my cabinets...I even found some on the ceiling fan! icon_lol.gif The fruit was pretty reasonable at Sams...about $25. You should try one some time!

Indy....My kids would agree with yours! icon_smile.gif

chutzpah Posted 10 Mar 2009 , 9:30pm
post #23 of 79

Lol on the ceiling fan!!!!!

kakeladi Posted 10 Mar 2009 , 9:33pm
post #24 of 79

........we only have walmart and smiths to get cake from so to be able to compete with them i would have too..........

BUT you are NOT competing against them. What you do is sooooo much different. Learn the newest styles - something very different from what they might be able to get from a grocery. That's how you compete w/them.

JodieF Posted 10 Mar 2009 , 9:35pm
post #25 of 79

Chutzpah...yep...my husband found it very amusing.....said he never thought he would have seen the day I'd be cussing chocolate!

Jodie

kalida Posted 10 Mar 2009 , 9:37pm
post #26 of 79

YuMyUm Jodie I agree with the ladies wonderful cake.
When i do cakes it's always been family and friends, i know i dont charge what i should but i just love decorating cakes and i still dont know how to really price my cakes. icon_confused.gif thats my 2 euro-cents heheh icon_smile.gif

shelly-101 Posted 10 Mar 2009 , 11:38pm
post #27 of 79
Quote:
Originally Posted by kakeladi

........we only have walmart and smiths to get cake from so to be able to compete with them i would have too..........

BUT you are NOT competing against them. What you do is sooooo much different. Learn the newest styles - something very different from what they might be able to get from a grocery. That's how you compete w/them.




Ok so maybe i worded that wrong compard to is a better word i know what i do is totally not the same thing but unless you make cakes people don't look at it that way expecially in a small town...

pattiverde Posted 11 Mar 2009 , 12:06am
post #28 of 79

This is a fascinating topic. Could some of you who do charge fairly for your cakes let us newer folks know how you come up with your prices? I've heard of simple formulas like 3x the cost of ingredients, and complicated formulas that require computer software... Any help for those of us who really have no clue how to determine our own fair prices?

Thanks!
icon_smile.gif patti

kcat3740 Posted 11 Mar 2009 , 12:31am
post #29 of 79

luvs and indydebi - you are right about some people not knowing what tastes good. We had a cake at work for winning an award - my boss asked if I would do it but they had a very specific picture of the award they wanted on it that would take an edible image and since I don't have an EI printer - I declined. They bought it from a bakery here and I had a small piece of cake - it was dry as heck and really awful! The icing was just crisco - no flavor! And these people have had my cakes (recipes from CC!) and raved about them - yet, at the luncheon they were all eating this cake and liked it! Yes they said my cakes were great but this was still good! Well it really was not! I think some people just want cake period and do not really care if it is a great cake or not!

dreamdelights Posted 11 Mar 2009 , 1:07am
post #30 of 79

Very good topic I am new to baking and trust me it is time and money. I am not charging for my cakes yet but will start soon. I hate dry cakes and that is the reason I started to bake when cakes are bought from Costco at work I decline.

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