Pricing - With A Twist

Decorating By cai0311 Updated 4 Jul 2009 , 2:45pm by indydebi

cai0311 Posted 2 Jul 2009 , 7:46pm
post #1 of 12

So, I know this is probably the 1000th pricing question, but I wasn't able to find a thread about the exact question I have.

There is a party complex near my house that wants to offer cupcakes/cakes from a local with their packages. I have talked with the owner on two occasions and she asked me give her a price quote for 30 cc, 50 cc, 1/4 sheet and 1/2 sheet cake. I know I can't charge full price because she has to mark up the cost for the customer to cover her expenses.

The only options the customer has is white or chocolate. The icing will be buttercream. The same decoration will be on all cakes (the store logo and the kid's name). She doesn't want to give the customer any options so there isn't any issues about not getting what they want/thought it should be.

Normally I charge $2/cc, $35 for a 1/4 sheet and $45 for a 1/2 sheet, but I think that is too much in this case.

Any suggestions?

11 replies
kakeladi Posted 2 Jul 2009 , 7:54pm
post #2 of 12

Since it will be a simple decoration you will get very very fast at putting them out. I wouldn't go much less than 20% lower, if that.
CC can go for $1.50 w/no problem. (IMHO).

ApplegumKitchen Posted 2 Jul 2009 , 8:14pm
post #3 of 12

You need to be able to ask yourself WHY you think it might be too much.

If it is because you think there will be
a) Less work
b) Less ingredients
c) Easier to do than your normal cakes

Then by all means lower your price to reflect that

If it is simply because you are worried that "it is too expensive for people to pay" then NO!! You calculate what you need to charge for something based on a certain criteria and it should not change unless that criteria changes.

And I don't understand your reasoning when you say "you know you can't charge full price because the store owner needs to put on her mark-up"
WHY???? the markup on ANY product is on top of 'what it costs to produce' - so if anybody should be taking a cut, it should be HER! ie. LESS MARKUP!

babykonst Posted 2 Jul 2009 , 8:26pm
post #4 of 12

i totally agree with apple, can you imagine you only charge her 1.50 per cc, and she turns around and sells them for 2.50 or even 3.00 each????

aligotmatt Posted 2 Jul 2009 , 8:27pm
post #5 of 12

I don't think you should get paid LESS because they want to mark up. I understand what you are saying about the mark up, but you should not take a pay cut for it. Figure out the cost of each of them, your time involved, how much you want to make per hour, and that's what you charge.

Stuff like this isn't always the best deal for home bakers (I assume that's what you are?) because you can't make things in bulk the same way a store can.

babykonst Posted 2 Jul 2009 , 8:28pm
post #6 of 12

i totally agree with apple, can you imagine you only charge her 1.50 per cc, and she turns around and sells them for 2.50 or even 3.00 each????

babybundt Posted 2 Jul 2009 , 8:43pm
post #7 of 12

charge what you charge. markup is not your problem. why short change yourself. most likely the cake or cupcakes is included the the price of the party so customer will not know the price. owner charges so much per head for the party and it includes everything.i know that is how it worked when i was having parties out when my boys were growing up........ icon_smile.gificon_smile.gif

indydebi Posted 2 Jul 2009 , 9:07pm
post #8 of 12

First, what are you calling a half sheet?

$35 for a 9x13 (24 servings) = $1.45/serving
$45 for a 12x18 (54 servings) = $0.83/serving

Why are you selling the larger cake for about half price? icon_confused.gif

Second, when I need to buy supplies from Sysco or GFS, believe or not, I can't go up to them and say, "I need to mark up the meatballs to sell them for $2.00 a serving, so you'll have to reduce your price to allow me to do that."

No, it doesn't work that way. Sysco tells me what the meatballs cost and I have to set my price based on MY expenses.

I really don't care what they mark the cake up to, but they are paying enough to cover my costs. If they dont' want a Cadillac, then they have to go shop at the Saturn dealership. BUt they are not getting my Cadillac cake at a Saturn price.

kandu001 Posted 3 Jul 2009 , 3:18am
post #9 of 12

I don't think you should charge less just so that she can make money. No matter what she marks the cost up to for the customer, she'll still be making money off of your work. Don't undercut yourself since YOU are doing all of the work!!!!

TexasSugar Posted 4 Jul 2009 , 4:49am
post #10 of 12

Do not charge less so she can make more money. If she finds your prices too high, then so be it.

You may be doing less work on the cakes, but you have to factor in how many parties she has a weekend. Alot of party places set aside two or three hours for each party and have parties going on all day. And depending on how big the area is they may have more than one party at once.

Do you really want to do 5 or 10 cakes a weekend every weekend at a low price??

1234me Posted 4 Jul 2009 , 2:15pm
post #11 of 12

I do cakes for a local party center so I know the situation you are in. I give them a 10% discount on all my prices, except for the decorative cookies I make.

If you are going to do this, let me recommend one thing. The cost of boxes has risen significantly and I feel like I am wasting my boxes taking them to her each week. If she is selling them outright, please have her recycle the box and let you use it to bring in the next weeks orders. If the customer is not seeing the box, who cares how it looks. I know this sounds petty, but I hate knowing they open the cake, and throw the box away!

Also, please sign some sort of contract with her for a specified time period - like 6 months. Evaluate the situation in six months and see if you are still ok with the discount or you may want to stop it all together. With a time-frame like that, it gives you a specific time to renegotiate if it is working for both you and the party center.

indydebi Posted 4 Jul 2009 , 2:45pm
post #12 of 12
Originally Posted by wendyintx

If she is selling them outright, please have her recycle the box and let you use it to bring in the next weeks orders.

Your health dept oks that? If it doesn't matter "what it looks like", we should all be using our used pizza rounds for our cakes. Gosh, we cover them, right?

"Looking" clean and sanitary is not the same as "being" clean and sanitary.

If you buy boxes in quanities of 100, you can get them for a really great price.

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