How Do I Find Out About Competitive Pricing??

Decorating By onlymadaresane Updated 12 Jan 2010 , 6:34pm by jammjenks

onlymadaresane Posted 8 Jan 2010 , 6:07am
post #1 of 18

The only thing I KNOW for sure is grocery store pricing.

How do I go about finding any local custom cake shoppes? I used Yahoo Local and got ZIP.

Any idea?

I've got my first wedding cake coming up (consultation tonight- went great-she's booking!) and I'm not sure how to price.

FYI:
It's a 5 tier (14,12,10,8,6) covered in fondant with red rose accents. Local grocery store charges $4 per serving for fondant and $2/ea for buttercream- stating that flowers are extra.

17 replies
snookadook Posted 8 Jan 2010 , 6:54am
post #2 of 18

I recently used Yahoo Local and typed in bakery and came up with a slew of numbers in Ohio. I then went down the list and because I was familiar with some of the areas I knew they were shops and not just an independent bakers phone number.

I also clicked on some of the bakeries listed and went to their websites. I also called the local bakery suppliers not a Michael or Pat Catan but the independent people who gave me names of cake decorating shops.
Some people I had to ask as if I was a customer who was pricing a cake since they stalled in telling me their prices.

Others like the cake suppliers told me when I said why I needed the info. I am glad I did this because the person I am dealing with had a budget that was not really going to work for the type of cake she wanted. Now I know how to scale it down and keep it pretty without breaking her wedding budget.

Make sure you keep in mind your labor (transportation, setup, price of all items that you are using, and do you have to buy any new products to make the items they are asking for, specialties, etc.). I am new also but I have learned quickly about underselling myself and barely breaking even on a cake due to my niceness.

Hope this helps.

jillmakescakes Posted 8 Jan 2010 , 1:13pm
post #3 of 18

What price did you give the bride? I'm assuming that you gave her a price since you said she was booking (I'm glad the consult went well thumbs_up.gif )

Do you know what price you need to charge in order to get a profit or are you just trying to charge about the same as your competitors (or lower)?

This information should have been researched before taking the consult in the first place.

If you haven't done the math on YOUR costs already, do that now. THEN you can decide how much of a profit margin you want. Some are OK with a smaller profit margin than others.

Lastly, if the local shops don't have their pricing online, go to their shops, call or email them with your pricing question.

Deb_ Posted 8 Jan 2010 , 1:15pm
post #4 of 18
Quote:
Originally Posted by jillmakescakes

What price did you give the bride? I'm assuming that you gave her a price since you said she was booking (I'm glad the consult went well thumbs_up.gif )

Do you know what price you need to charge in order to get a profit or are you just trying to charge about the same as your competitors (or lower)?

This information should have been researched before taking the consult in the first place.

If you haven't done the math on YOUR costs already, do that now. THEN you can decide how much of a profit margin you want. Some are OK with a smaller profit margin than others.

Lastly, if the local shops don't have their pricing online, go to their shops, call or email them with your pricing question.




BINGO!

Mike1394 Posted 8 Jan 2010 , 1:39pm
post #5 of 18
Quote:
Originally Posted by onlymadaresane


I've got my first wedding cake coming up (consultation tonight- went great-she's booking!) and I'm not sure how to price.




Hmmmm I just jumped off a cliff I don't know how to fly.

Why would you do this?

Have you EVER bought anything that could cost you 1000's, and NOT know what the price would be?

Mike

LaBellaFlor Posted 8 Jan 2010 , 1:56pm
post #6 of 18
Quote:
Originally Posted by Mike1394

Quote:
Originally Posted by onlymadaresane


I've got my first wedding cake coming up (consultation tonight- went great-she's booking!) and I'm not sure how to price.



Hmmmm I just jumped off a cliff I don't know how to fly.

Why would you do this?

Have you EVER bought anything that could cost you 1000's, and NOT know what the price would be?

Mike




icon_surprised.gificon_surprised.gificon_eek.gificon_eek.gificon_confused.gif Now that I'm over my shock, surprise and disbelief.

Ditto, ditto, ditto. You should know you pricing, before consults. I don't even know how you were able to book without giving a price. Are you sure she can afford you in the long run? Heck, are you even gonna make a profit in the long run?

indydebi Posted 8 Jan 2010 , 2:11pm
post #7 of 18

Add me to the list of folks who are confused on how you can book this without having any idea of what the price will be? icon_confused.gif

Knowing your competition's price is good info that you should know but it's not the do-all-end-all-have-to-have before you can set your own pricing. When I first set my pricing, I knew what it cost me and what I'd need to price it at to make a decent profit. icon_confused.gif WIth a good pricing structure in place, it's pretty easy to price a cake.

And I am FOREVER confused by those who sit there and say to themselves, "Hmmmm! I think I'll start making wedding cakes! I've no idea how much to charge but that's a detail I'll worry about later!" icon_confused.gif Seriously, people actually take those steps toward doing this as a business and they don't figure their expenses and the price they need to set FIRST????? icon_eek.gif

jillmakescakes Posted 8 Jan 2010 , 2:40pm
post #8 of 18

Debi is right (SHOCKER!!! icon_eek.gif )

When I figured my pricing, I calculated my cost, what I wanted as a profit and THEN I checked to see if I was way over or under the competition. I started out at the lower end, not the lowest, but not the top of the ladder either. As my skills progress, I noticed that some of my ingredients have gone up and I decided that I want a higher profit margin, so I raised my prices.

Its a good idea to be somewhat in line with your competition, but that shouldn't be the main factor in your pricing.

onlymadaresane Posted 8 Jan 2010 , 4:11pm
post #9 of 18

Well she's not going in blind. I suppose I should have added that I gave her grocery store pricing (which she had already checked into) and that I just needed to give her MY final numbers.

I did give her an estimated base price. Which I had figured in from my cost of ingredients and such. (it was a middle ground base) I was unsure on if I should price for flowers individually (as stores do around here) vs just a lump base and leave it as is. So I told her I needed to look a bit more.

From everyone's 'oh so shocking' comments- I suppose it's what I get. I feel like a kid who just got their knuckles smacked by the nun's ruler.

I've never advertised- nor do I have plans to in the future. So grab out the dumba$$ stamp and smack it on for not going in with it all ready.

Thanks for the advice!
You live and learn! icon_smile.gif

LaBellaFlor Posted 8 Jan 2010 , 4:17pm
post #10 of 18

I'm very gald you took everyone's comments with the spirit it was intended, care & concern. And remember, you are a custom cake maker, you can never compete with massed produced grocery store prices. Your prices should be much higher. icon_wink.gif

jillmakescakes Posted 8 Jan 2010 , 5:03pm
post #11 of 18

I second the kudos for taking the replies with class.

So, it sounds like your question isn't "what should I charge for the whole thing" but rather "What should be the upcharge for the design she requested?"

That is something that I still struggle with. I always think I'm giving a good price in the moment, but then as I'm making all of the tiny flowers, I'm cursing myself.

How many fondant roses are we talking here? 5-6 or a whole cascade?

JCE62108 Posted 12 Jan 2010 , 1:49am
post #12 of 18

I dont know what cakes go for in your area, but I did my research as others suggested. I checked out other decorators websites. I worked at a grocery store bakery so I knew exactly what they charged.

I use the guidelines of $3.50/serving for buttercream iced and decorated and $4.50/serving for fondant iced and decorated.

Sometimes I think Im higher than I need to be, sometimes lower. After I calculate it I take into consideration the flavor (if its basic or gourmet), design (simple or elaborate) and also any extras I may need beyond normal, like purchased gumpaste or silk flowers, molds, handmade gumpaste toppers, any carving or abnormal shapes, etc. I dont tell my customers everything Im charging for either. I just give them the final price so they dont think Im gonna nickle and dime them to death.

You should be higher than a grocery store. Grocery stores are face paced production. Wedding cakes are done in 2-4 hours. A 5 tier cake you take 10 hours to do (and no doubt the quality will be incomparable) should absolutly cost more.

I used to under sell myself all the time. I would add up the servings and think, oh GOD $780.00??? And totally loose my nerve, and say....uh....how does $350.00 sound? 10 hours and $150.00 in materials later I realize I cant do this sort of thing to myself anymore. Im talented enough, my product is beautiful and delicious, and I need to grow some b***s and stick with my pricing. Which I do.

With the pricing I chose to use, Im slightly higher than grocery stores, but less than some of my competition. Works out good for me. icon_smile.gif

silverc Posted 12 Jan 2010 , 2:51am
post #13 of 18

I am new to cake decorating also, and pricing is my biggest problem. I was just wondering if when you say you charge $4.50 per serving, do you use Wiltons suggested servings which says you can get 12 servings from a 6" round? I feel like I am in the same boat as a lot of cake decorators, people in my area are not willing to pay that much for a cake. When I price my cakes according to what I think they are worth, I don't get any orders!

LaBellaFlor Posted 12 Jan 2010 , 3:11am
post #14 of 18

Yes, I use Wilton's cake serving chart, NOT their party chart. So my serving is 1x2x4 size serving. I'm not sure what you charge for your cakes, nor am I familiar with your work, but if clients don't want to pay your prices, you are maketing to the wrong clients.

LaBellaFlor Posted 12 Jan 2010 , 3:15am
post #15 of 18

Silverc, just looked at your work, and unless you have an Ace of Cakes minimum of 1K, you are more then likely marketing to the wrong people. Always think like this, do you want to do one cake for $350 or 7 cakes for $50?

silverc Posted 12 Jan 2010 , 5:48pm
post #16 of 18

Thanks LaBellaFlor! I know that I am reaching the wrong customers but it is a vicious cycle. Once you do a cake for someone and their friends see it and ask you to do one for them and so on and so on....Thanks for your encouraging comments. I am going to stick to my prices and hope that I can make that one big sale instead of several small ones that I make very little money on.

Ladiesofthehouse Posted 12 Jan 2010 , 6:08pm
post #17 of 18

Are any of you that sell your cakes legally seeing a drop in volume at this point from the economy? Are you able to stick to your pricing and still have the number of orders you want/need to pay the monthly bills?

As this recession continues across the country (contrary to what the media is saying) I am wondering how it will affect people's ability to buy a premium cake for their event.

Sorry to hijack the thread, but it seems relevant to OP's question...

jammjenks Posted 12 Jan 2010 , 6:34pm
post #18 of 18

Actually, I just increased my prices. I have had no slow down as of yet.

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