I need suggestions on how much to charge for a delivery 1 hour away.
Wether it be a wedding cake or any occasion cake- what would be a fair price for me and the customer?
Figure out the distance (yahoo or google maps) and charge $0.75 per mile. However, personally, if it's in the city (now, in our city I can get from one side to the other in 45 min) I don't charge IF there is set up needed. Otherwise I have them pick up, or I charge.
full round trip mileage (you do have to get home) x $1 minimum
can have a base fee, say $25 for the first X miles and then $1/mile for any over that (full round trip!)
you have to be compensated not only for use of vehicle but ALSO your time! -- that's time (2 hours! if one hour away) that you could be doing something else -- like working on a cake or cookies for sale!
let's say your hourly rate for labor = $15/hour (low!)
so that's 25 cents a minute.
now IF you could drive 60mph - 1 mile/minute -- that's 25cents a minute to deliver
plus IRS rate of 55 cents/mile
so that's a minimum of 80 cents a minute/mile at 60mph
BUT -- 60 mph -- in town -- ok -- add in the cost of the speeding ticket too. (but officer I swear, the wedding is in just 30 min and the bridezilla this is for will kill me it's not there an hour ago -- Scotty, go to warp speed!)
so at LEAST $1/mile ROUND TRIP
20 miles away = $40 thank you.
I charge $1.25 round trip mile. I dont' deliver simple birthday or sheet cakes.
Most people figure something that will "cover my gas". you're spending much more than gas. In addition to what Doug already covered, I have to spend:
- Commercial rate insurance (which is about triple regular car insurance) to insure my vehicle to enable me to deliver your cake.
- the interest on my loan I had to take out to buy the vehicle to enable me to provide this delivery service for you (and if you have a car payment, then you have this expense).
- the expense of having to buy tires sooner than normal because of the extra wear and tear due to business use.
- the expense of more frequent oil changes due to higher mileage.
- oh yeah, and the decreased value of my vehicle because I'm racking up miles on it faster than the norm.
- Lost opportunity costs (if I'm in the van, I'm not making money by baking another cake)
What's fair to the customer? They get to sit on their a$$ in a nice comfy environment while you battle traffic for two hours to provide a service to them of delivering their cake TO them. If they don't think the delivery fee is fair, then can drive over and pick it up themselves. Then YOU can crash on the couch and tune in a Lifetime movie! (Ah! nothing more relaxing than watching a movie about a wife killing her no good husband!)
for IN-TOWN wedding deliveries I charge $50 for one cake, $75 for two cakes. It is still work and time, like the others stated. And that's not even taking into account that damage that might happen while in transport.
Thanks to all of you!! Now if you would all tell me what to charge for my cakes... and the customers would happily pay it!!!!