Figuring Out Discount

Business By sugarycreations Updated 18 Nov 2009 , 11:59am by minicuppie

sugarycreations Posted 31 Oct 2009 , 5:19am
post #1 of 15

I would appreciate some help in figuring out how much of a discount to give & at what levels. I have been approached about doing some logo cookies for a large company that would order a lot of them. I realize they are going to expect some kind of discount & I understand that. Yes, I have been told to think about what my price would be on what level of purchase. Naturally, I don't want to give more of a discount than necessary. icon_wink.gif

IF this works out, this is supposed to be a continual thing so both of us would need to be able to live with it. How many dozens would you recommend be ordered at one time to qualify for a discount & what type of discount would be the accepted business standard? Would you use a tiered approach for the discount?

As you can tell, I've not been in the situation of having anyone order more than 2-3 dozen at a time. Nope, I didn't consider that a large enough order to even think of a discount. But my understanding is that the orders would be for varying amounts & would sometimes be for tens of dozens.

One of the logos is very simple & I could probably have it downpat in @ an hour. Once I had it down, it's simple & could be whipped out pretty quickly. The other one is medium difficulty & would always take more time. Any help on figuring this out would be great!

Catherine

14 replies
CakeDiva73 Posted 31 Oct 2009 , 6:49am
post #2 of 15

That is tricky....is it possible that if it's a continuing order, you might consider an edible image printer to save on time (which = money)? If you are having to do ten dozen logo cookies, how much time does it take.

I am thinking maybe 10% discount on orders of 10 dozen or more, etc. Can't really go too much more then that because just because they are ordering alot, doesn't always mean you can sell them bulk. i.e. alot more work, not enough to justify buying/baking in bulk, etc....

tootie0809 Posted 31 Oct 2009 , 1:20pm
post #3 of 15

You still have to make them and decorate them and pay for ingredients, regardless of the large order. Unless you get ingredient discounts? I agree with CakeDiva that anytying more than 10% would be unfair to you. Cookies are a lot of work, so a large or small order, you are still hand decorating each one. Good luck on the job and I hope you get it!

-K8memphis Posted 31 Oct 2009 , 1:52pm
post #4 of 15

I don't know--you are willing to invest more time into it to learn these logos and you wanna charge less?

When I get t-shirts screen printed I get charged additionally for a new design. I can re-use the same design for no additional fee just for each location on the t-shrit and for each color used and for the t-shirt.

So if you charge for the time to learn the logos in the first place you could reduce the price on the second batches for the same artwork.

This is artwork. It's not the railroad salvage company yes?

What do you think?

icon_biggrin.gif

indydebi Posted 31 Oct 2009 , 2:17pm
post #5 of 15

Are you working with a commercial oven or a home oven?

Cookies, unlike cakes, have to be made one at a time, regardless of quantity. I can bake, ice and decorate ONE 2-layer cake that serves 24, or 38, or 56. 2 pans to prep and wash; 2 cakes to level, fill and stack, one 2-layer cake to ice and decorate. Significant time savings. But if I had to make those same 56 servings in a 6" cake, that's about five 2-layer cakes. That's 10 pans to wash, etc.

Cookies are made one at a time, regardless.

So if you're going to give a discount, it should be based on how much time (read "labor") it saves you.

In a home oven, you're still baking 12 to 24 at one time. In a commercial oven, I can bake 100+ at one time (20 cookies per sheet x 5 cookie sheets in the oven at one time).

If it's a consistent order, you can mix up and cut out the shapes ahead of time and have them in the freezer, ready to bake. Mass producing dough cut-outs is a time saver that can merit some kind of discount.

You don't give a discount just because it's a big order. (for the record, I consider 300 a day a big order). YOU give a discount when the volume and/or the production methods actually save you money .... whether it be by allowing you to buy in larger quantity (flour costing 1/2 a cent per cup instead of 12 cents per cup) or saves you time (read "labor") in mass productivity.

Since their qty will be varied, I'd seriously consider the cut-out-and-freeze method.

sugarycreations Posted 1 Nov 2009 , 2:43am
post #6 of 15

Ok, some very valid points were given & are helping me a lot. The edible image printer is a good idea, but I would have to have a contract for an extended time or wait until I have sold a lot of them. Might ought to just check out the pricing just to be sure. Maybe it wouldn't be that high. (I'm thinking aloud here.) Ten dozen confirms what I was thinking about as a breaking point on number.

I do have a dough roller that once I learn to operate would certainly make that part of the job faster. thumbs_up.gif The simplest logo is designed initial on solid background. My lettering is where I'm having to practice. icon_wink.gif Simple circle, square & rectangle cookies so nothing complicated there. I have 4 6-foot stainless prep tables in a rectangle back to back so have plenty of room to spread them out so could easily do 10 dozen at a time & still have room for other things that need doing.

In the past, I have experimented with all the ways I heard about icing cookies before settling on spreading Antonio's Royal with a spoon then outlining. Took me quite a while to get the knack but on these type of designs, I've gotten quite a bit of speed if everything is all set up first.
While I use regular kitchen equipment, I have a double oven & regular one so can do 6 trays at a time if I just concentrate on cookies at that time.

It would be really good for me as I haven't been opened long & some getting ongoing jobs would help with $$. As always, remodeling ran more than I had hoped. I'm not complaining about it. I need to make that clear as I got off very easy for what I got. My brother did the work for me as a labor of love so I had no contractor fees--only paid materials, plumbing & electrical. Because it was my brother, I got much more detailed stuff than would have been done otherwise. And although, he had never done a cakeshop or bakery, he had done coffee shops & restaurants in the past so had an idea of what needed to be done. He normally makes handcrafted furniture for a living so he made me a killer sales counter from curly maple & mahogany!

I still have money to cover all cake shop expenses & home expenses for a period of time, but gauging the economy & other things don't want to cut things close. Knew this would take time to get going good, but didn't count on the flooding our area had among other things out of my control. I was lucky & did not flood. However, the city did have a lot of flooding & after a month is now beginning to get back to normal.

The biggest problem I've had is the economy. I knew it wasn't the best when this was started, but it has had a much more adverse effect on others than I had hoped. Before I opened, I had lined up several people that were going to teach classes. ( I have an extra room for parties, meetings, classes, etc) One had to get a full-time job instead, one is in the middle of a divorce & such things. A few other things I had set up also blew up in my face; might happen later but no go for the moment.

Just because I'm needing to get more cash flowing at the moment does NOT mean I need to give the store away so to speak. That's why I wanted advice from ones of you that have done it before doing something stupid.

sugarycreations Posted 1 Nov 2009 , 2:43am
post #7 of 15

Ok, some very valid points were given & are helping me a lot. The edible image printer is a good idea, but I would have to have a contract for an extended time or wait until I have sold a lot of them. Might ought to just check out the pricing just to be sure. Maybe it wouldn't be that high. (I'm thinking aloud here.) Ten dozen confirms what I was thinking about as a breaking point on number.

I do have a dough roller that once I learn to operate would certainly make that part of the job faster. thumbs_up.gif The simplest logo is designed initial on solid background. My lettering is where I'm having to practice. icon_wink.gif Simple circle, square & rectangle cookies so nothing complicated there. I have 4 6-foot stainless prep tables in a rectangle back to back so have plenty of room to spread them out so could easily do 10 dozen at a time & still have room for other things that need doing.

In the past, I have experimented with all the ways I heard about icing cookies before settling on spreading Antonio's Royal with a spoon then outlining. Took me quite a while to get the knack but on these type of designs, I've gotten quite a bit of speed if everything is all set up first.
While I use regular kitchen equipment, I have a double oven & regular one so can do 6 trays at a time if I just concentrate on cookies at that time.

It would be really good for me as I haven't been opened long & some getting ongoing jobs would help with $$. As always, remodeling ran more than I had hoped. I'm not complaining about it. I need to make that clear as I got off very easy for what I got. My brother did the work for me as a labor of love so I had no contractor fees--only paid materials, plumbing & electrical. Because it was my brother, I got much more detailed stuff than would have been done otherwise. And although, he had never done a cakeshop or bakery, he had done coffee shops & restaurants in the past so had an idea of what needed to be done. He normally makes handcrafted furniture for a living so he made me a killer sales counter from curly maple & mahogany!

I still have money to cover all cake shop expenses & home expenses for a period of time, but gauging the economy & other things don't want to cut things close. Knew this would take time to get going good, but didn't count on the flooding our area had among other things out of my control. I was lucky & did not flood. However, the city did have a lot of flooding & after a month is now beginning to get back to normal.

The biggest problem I've had is the economy. I knew it wasn't the best when this was started, but it has had a much more adverse effect on others than I had hoped. Before I opened, I had lined up several people that were going to teach classes. ( I have an extra room for parties, meetings, classes, etc) One had to get a full-time job instead, one is in the middle of a divorce & such things. A few other things I had set up also blew up in my face; might happen later but no go for the moment.

Just because I'm needing to get more cash flowing at the moment does NOT mean I need to give the store away so to speak. That's why I wanted advice from ones of you that have done it before doing something stupid.

sugarycreations Posted 1 Nov 2009 , 3:27am
post #8 of 15

Ok, some very valid points were given & are helping me a lot. The edible image printer is a good idea, but I would have to have a contract for an extended time or wait until I have sold a lot of them. Might ought to just check out the pricing just to be sure. Maybe it wouldn't be that high. (I'm thinking aloud here.) Ten dozen confirms what I was thinking about as a breaking point on number.

I do have a dough roller that once I learn to operate would certainly make that part of the job faster. thumbs_up.gif The simplest logo is designed initial on solid background. My lettering is where I'm having to practice. icon_wink.gif Simple circle, square & rectangle cookies so nothing complicated there. I have 4 6-foot stainless prep tables in a rectangle back to back so have plenty of room to spread them out so could easily do 10 dozen at a time & still have room for other things that need doing.

In the past, I have experimented with all the ways I heard about icing cookies before settling on spreading Antonio's Royal with a spoon then outlining. Took me quite a while to get the knack but on these type of designs, I've gotten quite a bit of speed if everything is all set up first.
While I use regular kitchen equipment, I have a double oven & regular one so can do 6 trays at a time if I just concentrate on cookies at that time.

It would be really good for me as I haven't been opened long & some getting ongoing jobs would help with $$. As always, remodeling ran more than I had hoped. I'm not complaining about it. I need to make that clear as I got off very easy for what I got. My brother did the work for me as a labor of love so I had no contractor fees--only paid materials, plumbing & electrical. Because it was my brother, I got much more detailed stuff than would have been done otherwise. And although, he had never done a cakeshop or bakery, he had done coffee shops & restaurants in the past so had an idea of what needed to be done. He normally makes handcrafted furniture for a living so he made me a killer sales counter from curly maple & mahogany!

I still have money to cover all cake shop expenses & home expenses for a period of time, but gauging the economy & other things don't want to cut things close. Knew this would take time to get going good, but didn't count on the flooding our area had among other things out of my control. I was lucky & did not flood. However, the city did have a lot of flooding & after a month is now beginning to get back to normal.

The biggest problem I've had is the economy. I knew it wasn't the best when this was started, but it has had a much more adverse effect on others than I had hoped. Before I opened, I had lined up several people that were going to teach classes. ( I have an extra room for parties, meetings, classes, etc) One had to get a full-time job instead, one is in the middle of a divorce & such things. A few other things I had set up also blew up in my face; might happen later but no go for the moment.

Just because I'm needing to get more cash flowing at the moment does NOT mean I need to give the store away so to speak. That's why I wanted advice from ones of you that have done it before doing something stupid.

sugarycreations Posted 1 Nov 2009 , 3:50am
post #9 of 15

Ok, some very valid points were given & are helping me a lot. The edible image printer is a good idea, but I would have to have a contract for an extended time or wait until I have sold a lot of them. Might ought to just check out the pricing just to be sure. Maybe it wouldn't be that high. (I'm thinking aloud here.) Ten dozen confirms what I was thinking about as a breaking point on number.

I do have a dough roller that once I learn to operate would certainly make that part of the job faster. thumbs_up.gif The simplest logo is designed initial on solid background. My lettering is where I'm having to practice. icon_wink.gif Simple circle, square & rectangle cookies so nothing complicated there. I have 4 6-foot stainless prep tables in a rectangle back to back so have plenty of room to spread them out so could easily do 10 dozen at a time & still have room for other things that need doing.

In the past, I have experimented with all the ways I heard about icing cookies before settling on spreading Antonio's Royal with a spoon then outlining. Took me quite a while to get the knack but on these type of designs, I've gotten quite a bit of speed if everything is all set up first.
While I use regular kitchen equipment, I have a double oven & regular one so can do 6 trays at a time if I just concentrate on cookies at that time.

It would be really good for me as I haven't been opened long & some getting ongoing jobs would help with $$. As always, remodeling ran more than I had hoped. I'm not complaining about it. I need to make that clear as I got off very easy for what I got. My brother did the work for me as a labor of love so I had no contractor fees--only paid materials, plumbing & electrical. Because it was my brother, I got much more detailed stuff than would have been done otherwise. And although, he had never done a cakeshop or bakery, he had done coffee shops & restaurants in the past so had an idea of what needed to be done. He normally makes handcrafted furniture for a living so he made me a killer sales counter from curly maple & mahogany!

I still have money to cover all cake shop expenses & home expenses for a period of time, but gauging the economy & other things don't want to cut things close. Knew this would take time to get going good, but didn't count on the flooding our area had among other things out of my control. I was lucky & did not flood. However, the city did have a lot of flooding & after a month is now beginning to get back to normal.

The biggest problem I've had is the economy. I knew it wasn't the best when this was started, but it has had a much more adverse effect on others than I had hoped. Before I opened, I had lined up several people that were going to teach classes. ( I have an extra room for parties, meetings, classes, etc) One had to get a full-time job instead, one is in the middle of a divorce & such things. A few other things I had set up also blew up in my face; might happen later but no go for the moment.

Just because I'm needing to get more cash flowing at the moment does NOT mean I need to give the store away so to speak. That's why I wanted advice from ones of you that have done it before doing something stupid.

sugarycreations Posted 1 Nov 2009 , 3:53am
post #10 of 15

Soooooo sorry about the repeat posts! On my end, it kept telling me there was an error & to try again. Is there anyway I can go in & delete the extra posts?

Barb1959 Posted 1 Nov 2009 , 4:06am
post #11 of 15

Even though it says error, it still posts. Everytime I see error, I first go back in and look to see if it made it.

sugarycreations Posted 1 Nov 2009 , 10:23pm
post #12 of 15

Need to buy an edible image from somewhere & play with it. icon_rolleyes.gif After getting some sleep so my brain could actually function, I checked on the printers & they're not as expensive as I thought they were. Not sure how well I would like the results compared to piping though so I figure a sheet of images to play with on the royal icing would give me a good chance of deciding whether or not I even wanted to go there. So I really appreciated that suggestion CakeDiva73.

While I'm sure they would be happy if I gave a discount larger than 10%, I don't think that is something I could live with so that'll be the maximum discount only available if 10 dozen or more are ordered at a time. It would be different if I wanted to get into the wholesale business, but I don't.

I really appreciate all the input I got. Thanks everybody!

minicuppie Posted 3 Nov 2009 , 4:11pm
post #13 of 15

SC...I can see by your many posts (LOL) that you already have the mindset and skills to mass produce. Show the buyer 3-4 different deco choices with the amt of money for each (per whatever amt they buy at a time...discount per sliding scale maybe?) They may not like the premade and glued on deco. If not...make sure you are compensated for your time. Don't forget to charge enough for packaging and /or any extra help you may need for the REALLY big orders. Good luck...this could be a really good thing for you.

sugarycreations Posted 18 Nov 2009 , 2:42am
post #14 of 15

Just an update: nothing has been settled for sure, but looking good. The gentleman setting it up was a chef for @20 years so is being VERY helpful. Told me the best way to handle it was roll out a rectangle of dough, place on cookie sheet, use a knife or pizza cutter & straight edge & score it into 1.5" X 3" pieces. Says they will break apart easily & can then be iced. Evidently all that is wanted is the initial/initials (the buyer owns 5 different hotels) with the proper color from their logo for the background. Liking the sound of this. icon_lol.gif If that will suit the buyer, then I know several businesses in town, I'm pretty sure I could get to buy them also. They're just wanting something simple & basic for marketing & to impress the company bigwigs when they're in town.

In the meantime, going to start in the near future with supplying 2 1/2 doz cookies to one of the hotels daily. Can we say double or triple batch mixing, scooping & freezing until needed to be baked?

Catherine

minicuppie Posted 18 Nov 2009 , 11:59am
post #15 of 15

Sounds like you stumbled on a great opportunity for your business. I am jealous. Tip...have fun with this...

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