Hi... I'm trying to put a business plan together and have gotten the prices for basic cakes down, but I'm not sure on prices for extras such as figures, flowers (gumpaste and/or fresh) and about deliveries, how much do I charge for deliveries? or do I make the cake price a little higher and make it "included" in the cake price? (so it would be higher for a bigger more delicate cake)... sorry if this has been covered, I looked and did not see these specific questions. Thanks for all your help!
If delivery is included, you should limit your free delivery area. Free delivery is ok if it's 5 miles away, but what about the 50 miles away cake? (100 miles round trip and at least 2 hours of your time).
Just to give you an idea, I charge $1.25 per round trip mile. I dont' deliver sheets or small birthday cakes, just wedding and large tiered cakes. This $1.25 covers more than just gas (which is what most people think of). In this $1.25 is also the expense for:
- commercial insurance for your delivery vehicle
- interest expense for the loan you took out to enable you to buy that delivery vehicle
- general wear and tear on your vehicle (oil, tires, added mileage (which is a BIG expense when you need a new van!, etc)
- lost opportunity costs (While you're in the van, you're NOT making a cake that will bring in more money).
- payroll expense, even if the payroll is just you. As you set your prices, you have to go thru a lot of "what about when I get to the point .....?" So when you get to the point where you have an employee who is doing all of the deliveries, you'll have to pay that person door to door, which means they will clock in, grab the cakes and keys, drive 50 miles to drop off a cake and then drive 50 miles back to the shop, hand you the keys, and then clock out. You're paying him for the time he's in the van BOTH WAYS.
I know a florist who charges a "set up and delivery fee" and charges a percentage of the cost. Her logic is that a $5000 order will take way more set up time than a $500 order, so a 10% "set up and delivery" covers that.
indydebi, as always, your answer rocks...
I don't know how anyone else does this, but I figure out how long it's going to take me to make a figure (i.e. the pooh topper in my avatar) and then charge what I want to make per hour. Pooh topper cost $10 bc it took me an hour to make. For bigger or more detailed figures, it will take more time so charge appropriately.
I haven't attempted to make gumpaste flowers yet, so I don't know how to help you there. I know there is a lady a few towns over that makes them and charges around $2 (base price) per flower. If the brides want fresh flowers, I make them provide them and make sure they are waiting for me when I show up to set up the cake. That way they get the exact color flowers that they wanted.
As for deliveries, I'm with Debbie. I have free delivery up to 25 miles and then it's $1 per mile after that.
Hope this helps
You are going to get so many different answers on pricing. But there are some websites that actually sell RI and gumpaste flowers. You could look around for those on the net and then price yours similarly.
And I think figures (depending on how much time is involved) can go from $15-$25. And I know a lot of other people go higher than that.
I don't do my pricing as a base price then charge extra for the "extras" I think that is a bit misleading.
I have a pricing grid. 4 levels of decor: basic, level 1, level 2, level 3 with level 3 being the most ornate and architecturally challenging. Then within those levels 3 icing choices: Buttercream/Creamcheese, Poured Fondant, Rolled fondant, then further break down into servings with the fewer servings costing more per serving: Under 101, 101-150, 151-200, over 200. The least expensive per serving rate in my matrix is a basic buttercream or creamcheese BC cake that serves over 200. The most expensive is a level 3 fondant cake that serves under 101. Each level incorporates the cost/expense of the "extras" so your per serving rate is what it will cost the client for that cake. The ONLY extra I do charge is delivery, and you only get a free delivery allowance of 10 miles if you order a cake over 200 servings. My document that has that matrix is on a different computer but if interested you can pm me for it.
I use a base pricing that includes most reasonable buttercream decorations. All gumpaste and fondant accessories are extra I judge their price by how long it takes for me to make it. My wage for 1 hour of work is between $15-$20 an hour.