HI, I have been asked to provide a quote for 20 dozen cupcakes ( minis)
I normally sell them at $1.00/mini. I dont know what to say, as getting packaging ( case of 100) would itself cost me a good bit.
Is it a one time shot or a continuous order? Are you going to save any money by making lots of them or is your cost basically the same, only more of it?
A volume discount is given when the volume enables the mfg'r (you) to save money, and that savings is passed on to the customer.
Example: A one time order costs you either in time (because it takes longer) or it costs you in equipment (buy more cupcakes pans to save time but you spend money.) At the end of that order, what are the odds you're going to need 10 cupcake pans again? But a standing order means you can amortize the cost of the equipment over the life of the order.
Example: I can order flour in 25 lb bags at less than a penny a cup vs. flour at the grocery for 20 cents a cup. But if you just buy 5 bags of flour at the grocery instead of one, you've not saved any money, so why does the client get it cheaper?
Example: I can put 8-12 dozen cupcakes in my oven at one time, so we're talking only a couple of baking cycles. Saves me money on the utilities. But if I worked out of a home oven and could only bake 24 at a time, the baking cycle is the same for 20 dz as it is for 2 dozen .... just more cycles. It's not saving you any money, so why does the client get it cheaper?
Volume discount is not given "just because". There is a big math computation involved. (When I worked at the wire/cable/powercord company, this was my job.)
Deby, thank you so much. The 20 dozen volume is a one time thing - though I do supply him 6- 8 dozen cupcakes a week.( this is new for us on a trial basis) This bulk order is for some charity , so I was debating a 10% discount.
All that you said is what I was thinking. I was also thinking about a "good will " factor. Thanks so much, Elaine
Of course you say yes to a loyal customer. Esp. if it will potientially bring more business. Since it is for charity you can take any cost difference off as business loss. I wouldn't buy anything new and maybe invoice the cost of packaging to him. He'll get it.
Of course you say yes to a loyal customer.
What a silly thing to say!
Just because a loyal or repeat customer wants something, she should say yes? What if he wanted them for free? Or even 50% off? Should she 'say yes'?
But he didn't.
no, he didn't.
But my question still stands......
Its funny how I was just hit with the bulk cupcake discount question on Saturday 30 minutes before this thread began. After a pause the word "no" just happened to slip out. I guess that accident saved me money.