I Think Its Over Before We Even Got Started...

Business By cakemeasIam Updated 9 Feb 2010 , 3:08am by cakemeasIam

cakemeasIam Posted 15 Jan 2010 , 5:05pm
post #1 of 42

i get calls every day for pricing information... i tell them what we charge
20 serving min at 3/serving (i know i will get blasted for that one... icon_surprised.gif )

i know we are just starting out- since may- and the market is ours as far as 3d cakes and fondant work. but people just don't want to pay.
i then try to give them other options to stay within their budget and never hear back from them. some of my close firends are saying you need to start offering sheet cakes, and other party cakes instead of just what we want to do.

we live 80 miles south of st louis - small rural town with big city dreams; i am not using that as an excuse but can you please give me some advice on what my next step is. we are only seeing 1 or 2 cakes a week which only brings in the minimum.
thanks for listening...

41 replies
KHalstead Posted 15 Jan 2010 , 5:12pm
post #2 of 42

i'm kinda in the same boat as you and i'm pretty much forced to offer sheet cakes to get regular orders.

However, with that said I'm not charging anywhere NEAR wal-mart prices for my sheet cakes. But my sheet cakes aren't their sheet cakes...they're still custom designed and I really try to do stuff that they CANT get at the chain stores so that they realize there is a big difference between mine and theirs in looks and flavor.

My sheet cakes are about $1.00/serv. my tiered bc cakes are $2.25/serv. so when someone says that's too much for a tiered cake......I take them to the sheet cakes........or single round/square cakes for $1.50/serv.

If they want a custom designed, freshly baked cake..it's gonna cost more...plain and simple. It costs me more of my mothly budget to bake their cake than it does Wal-Mart!

Kitagrl Posted 15 Jan 2010 , 5:26pm
post #3 of 42

The longer I've had customers, the less and less I've done sheet cakes. I started out doing quite a few, and then went less and less...and now, I rarely if ever do them. Once in awhile, and that's about it. Mostly because I've raised my minimum per serving price to cover everything no matter what...even sheet cakes. The only way that is different is if the sheet cake is underneath a 3D cake, then I will make the sheet cake cheaper since it doesn't take any decoration.

Anyway I guess I'm saying, do what you need to do NOW to get your orders and profit...but as you get busier, you can raise the prices with your sheet cakes until people are encouraged to just order what you specialize in.

jodibug0975 Posted 15 Jan 2010 , 5:46pm
post #4 of 42

I understand! I am in Jefferson City MO, and the market in this area would just NOT support a custom cake shop.

The biggest place around here starts their BC cakes at $1/serving.

Which is why I will probably always have to keep my day job and just do cakes as a hobby.

cakesbycathy Posted 15 Jan 2010 , 7:31pm
post #5 of 42
Quote:
Originally Posted by KHalstead

i'm kinda in the same boat as you and i'm pretty much forced to offer sheet cakes to get regular orders.

However, with that said I'm not charging anywhere NEAR wal-mart prices for my sheet cakes. But my sheet cakes aren't their sheet cakes...they're still custom designed and I really try to do stuff that they CANT get at the chain stores so that they realize there is a big difference between mine and theirs in looks and flavor.

My sheet cakes are about $1.00/serv. my tiered bc cakes are $2.25/serv. so when someone says that's too much for a tiered cake......I take them to the sheet cakes........or single round/square cakes for $1.50/serv.

If they want a custom designed, freshly baked cake..it's gonna cost more...plain and simple. It costs me more of my mothly budget to bake their cake than it does Wal-Mart!




Are your sheet cakes single layer or 2 layers with filling?

KHalstead Posted 15 Jan 2010 , 7:43pm
post #6 of 42

single layered, if it's 2 layers it follows the $1.50/serv. pricing

so let's say someone wants a 1/4 sheet (8x12") cake, that's 20 servings, so I charge $20. If they want it 4" high, meaning double layered...Then that is 40 servings and $60.

However, when someone has placed an order for a wedding cake...I do offer 2 layered sheet cakes (kitchen cakes) for $1.00/serv. However,there must be a tiered cake order in addition to that cake...otherwise that cake is 1.50/serv. Hopefully that makes sense?

TexasSugar Posted 15 Jan 2010 , 8:03pm
post #7 of 42

I'm curious why you aren't charging them atleast $2 a serving for a two layer sheet cake. They are getting twice the cake, why not twice the price?

jodibug0975 Posted 15 Jan 2010 , 9:00pm
post #8 of 42
Quote:
Originally Posted by TexasSugar

I'm curious why you aren't charging them atleast $2 a serving for a two layer sheet cake. They are getting twice the cake, why not twice the price?




I am assuming it because only the top layer is decorated.

KHalstead Posted 15 Jan 2010 , 10:06pm
post #9 of 42

It's actually a "special" that I offer when they order a tiered wedding cake. I do it to discourage them from ordering sheet cakes elsewhere 9which is not allowed in my contract, but it's really to deter them from sneaking lol)

It's not torted either, I just fill and stack the 2 layers, torting is extra.

pattycakesnj Posted 15 Jan 2010 , 10:25pm
post #10 of 42

I do sheet cakes too just to pay the rent, really anything a client wants but the sheet cake is still the same price as a round or square (though I do tort it) and I have a minimum order. Stick with it and don't sell so cheap. Once you go down that road, it is hard to come back. (I speak from experience) Explain why you charge what you charge and how you differ from Walmart and Costco.

cgm_cakes Posted 15 Jan 2010 , 10:35pm
post #11 of 42

KH - I just wanted to say that I just spent 20 min. looking at your website and your work is exquisite - I can't believe you don't charge more. You are very talented. icon_smile.gif

4them Posted 15 Jan 2010 , 11:12pm
post #12 of 42

Hang in there, I am 45 miles north of Kansas city and we are still swamped. I love it, I don't even have time to update my website, lol.

Advertise some how, word of mouth will definitely make people curious.

People are very tired of basic cake and once they realize that custom cost they will be back.

karenm0712 Posted 16 Jan 2010 , 8:40pm
post #13 of 42

I feel you on this. Although I haven't done much advertising, I do have a facebook page and a mailing list - people inquire a lot but I might get one order a month...on a good month two. Everyone raves about my cakes, but I think my pricing is just more than they expect to pay. I had considered lowering my prices, but I just don't think that they are that high to begin with! I haven't spent much time "advertising", but I have over 120 facebook fans and around 30 on my mailing list (this includes friends & family).

I did send out a Holiday flyer, but it only brought in one birthday cake order. icon_sad.gif

I was just thinking today about how many people I have spent time quoting and it not turning into anything...it's a real bummer.

I was going to send out a Valentine's Day Flyer, but just don't want to waste my time (bad attitude I know)...

Hopefully things will turn around soon for those wanting more customers. icon_smile.gif

confectionsofahousewife Posted 16 Jan 2010 , 9:17pm
post #14 of 42

MObeefcake and jodibug, you guys are scaring me! I'm small town MO too and am working on opening a home bakery in the next year. I worry that this town won't support the kinds of cakes I want to do. There are definitely other bakers out there but not that will do 3D cakes and fondant figures and sugar flowers. There is one other shop in town that would be similar but the lady that owns it is.... how to say it.... not very nice! I will be doing it out of my house so at least I won't have to pay rent, but there is equipment to be bought so I want to be able to at least pay for that stuff.

newmansmom2004 Posted 16 Jan 2010 , 9:31pm
post #15 of 42
Quote:
Originally Posted by jodibug0975

Quote:
Originally Posted by TexasSugar

I'm curious why you aren't charging them atleast $2 a serving for a two layer sheet cake. They are getting twice the cake, why not twice the price?



I am assuming it because only the top layer is decorated.




Jodibug is right - if they're getting twice the cake you should be charging more. My sheet cakes are decorated all around the sides and the top - not just the top. And I torte them. Two layers of cake and a layer of filling plus the outside icing and decorating. I don't really get the whole aversion to sheet cakes myself - I like doing them. Maybe I'm just odd. icon_lol.gif

CarolAnn Posted 16 Jan 2010 , 9:56pm
post #16 of 42
Quote:
Originally Posted by newmansmom2004

Quote:
Originally Posted by jodibug0975

Quote:
Originally Posted by TexasSugar

I'm curious why you aren't charging them atleast $2 a serving for a two layer sheet cake. They are getting twice the cake, why not twice the price?



I am assuming it because only the top layer is decorated.



Jodibug is right - if they're getting twice the cake you should be charging more. My sheet cakes are decorated all around the sides and the top - not just the top. And I torte them. Two layers of cake and a layer of filling plus the outside icing and decorating. I don't really get the whole aversion to sheet cakes myself - I like doing them. Maybe I'm just odd. icon_lol.gif




newmansmom, No you're not odd! I love doing sheet cakes. I have never understood the sheet cake thing either. (and don't want to get that going here) BUT I do double layer sheets and tort and filled. I charge double for the dbls and charge extra for the t/f. I always give my customers the options for the number of servings they want/need.
ie 2x2" single layer servings vs 1x2" of dbl layer or t/f. I'm a hobbiest not a business and don't do a lot of cakes, but I try to give them just what they need.

this-mama-rocks Posted 16 Jan 2010 , 10:12pm
post #17 of 42

[/quote] I charge double for the dbls and charge extra for the t/f. I always give my customers the options for the number of servings they want/need.
ie 2x2" single layer servings vs 1x2" of dbl layer or t/f. I'm a hobbiest not a business and don't do a lot of cakes, but I try to give them just what they need.[/quote]

I'm confused. If you have "customers" and you "charge" them, doesn't that make you a business, not a hobbyist? icon_confused.gif

CarolAnn Posted 16 Jan 2010 , 10:34pm
post #18 of 42
Quote:
Originally Posted by this-mama-rocks


I charge double for the dbls and charge extra for the t/f. I always give my customers the options for the number of servings they want/need.
ie 2x2" single layer servings vs 1x2" of dbl layer or t/f. I'm a hobbiest not a business and don't do a lot of cakes, but I try to give them just what they need.[/quote]

I'm confused. If you have "customers" and you "charge" them, doesn't that make you a business, not a hobbyist? icon_confused.gif[/quote]

No it doesn't, in my opinion. This isn't my livlihood and I in no way depend on making cakes for my income. I'm not liscensed nor do I collect or pay taxes on what I do. I just love baking and decorating cakes. I think I have about I<->I much talent and I enjoy making special cakes for people's special ocassions and I happen to charge for my time and effort and supplies. It's fun, relaxing (though stressfull at times) and gives me a little cash to spend or stash. That's not a business to me.

KHalstead Posted 17 Jan 2010 , 3:27pm
post #19 of 42
Quote:
Originally Posted by newmansmom2004

Quote:
Originally Posted by jodibug0975

Quote:
Originally Posted by TexasSugar

I'm curious why you aren't charging them atleast $2 a serving for a two layer sheet cake. They are getting twice the cake, why not twice the price?



I am assuming it because only the top layer is decorated.



Jodibug is right - if they're getting twice the cake you should be charging more. My sheet cakes are decorated all around the sides and the top - not just the top. And I torte them. Two layers of cake and a layer of filling plus the outside icing and decorating. I don't really get the whole aversion to sheet cakes myself - I like doing them. Maybe I'm just odd. icon_lol.gif





If you do the math I'm actually charging triple for twice the amount of cake.

I charge $1.00/serv. but for the double layered they're $1.50/serv. (the servings are doubled not the cost per serving)

So for a single 8"x12" (20 serv.) I charge $20.00 ($1.00x20)
for a 2 layered 8"x12" (40 serv.) I charge $60.00 ($1.50x40)

seems like I'm not charging enough, but I'm actually getting MORE than double...this accounts for the time involved in stacking and the extra icing between the layers (at least that's what I tell the customers)

When they ordered a tiered cake, they can get teh double layered sheetcakes (ie: kitchen cakes) at 1.00/serv. but that's still double the cost for double the cake....so I do make a little less on those but it's still making what I would have normally charged for 2 separate sheets that are single layers.

Lita829 Posted 17 Jan 2010 , 3:42pm
post #20 of 42

A lot of good info in this thread thumbs_up.gif . I am aweful at pricing...usually WAY too low. I haven't sold any sheet cakes yet but I am going to follow the practices of many of you.

Thank you for sharing all your info about how things are done in this industry...its very helpful to a budding caker/business woman icon_smile.gif

The_Lil_Cakehouse Posted 17 Jan 2010 , 4:34pm
post #21 of 42

Does anyone know where to get really good sheet cake pans, and which sizes are full, half, quarter, and height 2" or 3". I know I probably sound like an idiot asking that basic of a question, but every thing I research gives different sizes for each, and I have had family ask for my sheet cake prices. Most of my pans I inherited from my Grandma who used to do cakes and she bought THE BEST there was. So I was really fortunate to fall into those. But they're all nesting pans. I thought it'd be really handy to have sheet pans just in the off chance I had those ordered. I don't think they're a bad thing to do, I think they'd be good practice and good starter cakes to get your name out there. You could litterally get your name out there by putting your label on the cake and delivering to local businesses, I work at a Real Estate office also, and we're always needing cake for bdays, holidays, etc. It'd be an edible business card icon_smile.gif

Lita829 Posted 17 Jan 2010 , 4:41pm
post #22 of 42
Quote:
Originally Posted by SassyCakes09

Does anyone know where to get really good sheet cake pans, and which sizes are full, half, quarter, and height 2" or 3". I know I probably sound like an idiot asking that basic of a question, but every thing I research gives different sizes for each, and I have had family ask for my sheet cake prices. Most of my pans I inherited from my Grandma who used to do cakes and she bought THE BEST there was. So I was really fortunate to fall into those. But they're all nesting pans. I thought it'd be really handy to have sheet pans just in the off chance I had those ordered. I don't think they're a bad thing to do, I think they'd be good practice and good starter cakes to get your name out there. You could litterally get your name out there by putting your label on the cake and delivering to local businesses, I work at a Real Estate office also, and we're always needing cake for bdays, holidays, etc. It'd be an edible business card icon_smile.gif




Wilton has nice ones and they are reasonably priced. I have the 9 X 13 and the 11 X 15. I have never used them but I am assuming they perform like the other Wilton pans I have. I like how the Wilton pans that I have used perform.

HTH icon_smile.gif

this-mama-rocks Posted 17 Jan 2010 , 6:01pm
post #23 of 42

I'm confused. If you have "customers" and you "charge" them, doesn't that make you a business, not a hobbyist? [/quote]

No it doesn't, in my opinion. This isn't my livlihood and I in no way depend on making cakes for my income. I'm not liscensed nor do I collect or pay taxes on what I do. I just love baking and decorating cakes. I think I have about I<->I much talent and I enjoy making special cakes for people's special ocassions and I happen to charge for my time and effort and supplies. It's fun, relaxing (though stressfull at times) and gives me a little cash to spend or stash. That's not a business to me.

You may not be licensed, and you may not use it for you primary sources of income, but you most certainly ARE conducting business.

Yes, I would get the Wilton pans - use the Michael's or JoAnn's coupon. And for the OP, if you are doing this from home, and not sweating making the rent payment on a storefront, I would wait out the storm. Your customers are out there - find them, or help them find you. I donated a couple of cakes (large, 3-tier) to some high-profile events/causes, and it has paid off really well for me.

_Jamie_ Posted 17 Jan 2010 , 6:05pm
post #24 of 42
Quote:
Originally Posted by cgm_cakes

KH - I just wanted to say that I just spent 20 min. looking at your website and your work is exquisite - I can't believe you don't charge more. You are very talented. icon_smile.gif




icon_cool.gif We chide her constantly for this....and she is so good natured about it! icon_razz.gifthumbs_up.gif

mireillea Posted 17 Jan 2010 , 6:43pm
post #25 of 42

I am pretty shocked to hear the low prices that you have to ask to attract customers. I am so sorry for you! You make wonderful cakes that are worth a lot more than 2.25 dollars per serving!
I realize that there is a big difference between locations in de US and in fact worldwide. I live and work in the Netherlands and prices here are way higher. A local bakery will charge about 5 euro (7.20 dollars) for a simple wedding cake: one layer filled cake covered in marzipan decorated with some marzipan roses. That is why I dare to ask between 6 - 7 euro (8.50-10 dollars) per serving for a decorated wedding cake. But I deliver all cakes (or actually my husband does - we are in this business together). We have to deliver or we wouldn't have a business. Most orders come from a 50 - 100 km range.
Isn't it possible to advertise in a wider range (maybe even the first big town) to attract customers that are willing to pay higher prices? Because in my experience, people that pay higher prices, understand and don't mind to pay delivery charges.
Maybe that way, you could expand your business and your income.

indydebi Posted 17 Jan 2010 , 6:51pm
post #26 of 42
Quote:
Originally Posted by TexasSugar

I'm curious why you aren't charging them atleast $2 a serving for a two layer sheet cake. They are getting twice the cake, why not twice the price?




Generically speaking:

The "twice the price" comes into play with the number of servings.
single layer 12x18 serves (approx) 50 x $1.00/serving = $50
double layer 12x18 serves (approx) 100 x $1.00/serving = $100

Texas, what you and I have seen that calls the pricing into question are the threads in which the baker charges $50 for a single AND for a double layer cake. The double layer has twice the cake, so the client should pay more for a double layer than they do for a single layer.

step0nmi Posted 17 Jan 2010 , 7:12pm
post #27 of 42

here are some things that could help:

found out your key demographic.
find out what would best suit to that demographic.
where are they?
How much do they make?
are you marketing in the right area?
if you have a shop are you IN the right area?
are you working with local restaurants, halls, or entertainment venues to offer specials for large orders?

just some things to start you off with and then once you get into those issues it will bring up other ideas in order to market to your customers. If you do have to start doing some sheet cakes then so be it...but explain to the people you call what is all included in your work! icon_wink.gif

KHalstead Posted 18 Jan 2010 , 3:20pm
post #28 of 42
Quote:
Originally Posted by mireillea

I am pretty shocked to hear the low prices that you have to ask to attract customers. I am so sorry for you! You make wonderful cakes that are worth a lot more than 2.25 dollars per serving!
I realize that there is a big difference between locations in de US and in fact worldwide. I live and work in the Netherlands and prices here are way higher. A local bakery will charge about 5 euro (7.20 dollars) for a simple wedding cake: one layer filled cake covered in marzipan decorated with some marzipan roses. That is why I dare to ask between 6 - 7 euro (8.50-10 dollars) per serving for a decorated wedding cake. But I deliver all cakes (or actually my husband does - we are in this business together). We have to deliver or we wouldn't have a business. Most orders come from a 50 - 100 km range.
Isn't it possible to advertise in a wider range (maybe even the first big town) to attract customers that are willing to pay higher prices? Because in my experience, people that pay higher prices, understand and don't mind to pay delivery charges.
Maybe that way, you could expand your business and your income.




yeah, I know...and I do sell cakes to the Cleveland area (about 65 miles away....so the delivery is $65) and people there are more than happy to pay my prices since most cakes there start at around $5.00/serv.

However, where I am the tiered cakes start at $1.00 to $1.25/serv. and these are the prices for the other 2 ladies that do them, both with storefronts and both with 20+ years of experience. I have been doing cakes for 2 yrs. now and work out of my home and charge almost double what they charge. I make a decent profit even at these prices ($2.25/serv.) and am so much faster at decorating than I used to be, so it usually works out that I'm paying myself anywhere from $8-$10/hr. for my labor above and beyond the cost of the cakes themselves and I'm ok with that for now.

Trust me, there will come a day when my prices go up again (I've already raised them several times since beginning....I tried to charge around what the others charged but didn't like my profit margin and got WAY too busy, so I raised them)

I'm starting to get busy again, so they'll go up again lol

mireillea Posted 18 Jan 2010 , 7:06pm
post #29 of 42

That is good to hear! I have been raising my prices several times and it is still getting busier so I am not afraid to raise them again next year.

EvMarie Posted 26 Jan 2010 , 5:40am
post #30 of 42

I read this post about an hour ago and I just put my head on my pillow to snooze for the night and POOF! I got an idea. Granted, it may not save the day, but maybe you can use it as a way to get thinking in a different direction?

What if you offered lower priced standards? For example:

Valentines Day is coming. Why not offer a 6 inch heart? I realize there is a pan, but I'm talking about a "pillow" carved type heart. You could of course do all kinds of festive fondant decoration with red, purple, pink. Even, black to funk it up, depending on your style. I could see somebody buying it for a romantic dessert.

Or, for spring time: A 6 inch five or six petal fower? Fun colors. The popular combo of orange/hot pink. Or lime and yellow. Or, all of them! Again, carved to demonstrate a rounded 3d affect. Fondant accents.

Mothers Day: Maybe an oval base cake. Then some kind of specialty added to the top. Perhaps an airbrushing of pearl shimmer and a monogram or the word "Mom"? A small bunch of simple fondant flowers?

You get the idea. The ideas are endless. For 4th of July a star could be cool or a set of firecrackers. Although, I'm not sure who would buy that. A year round birthday offering? Your signature style, maybe just carved like one tier of a mad hatter.

Maybe people aren't sure about you because your on the newer side. If you can bring down your price point by offering smaller simpler carved cakes with fun fondant maybe they'll come back for bigger projects. Taste will sell you for sure! By offering standards you can control cost. Like, the hearts can be your chocolate cake. The spring flower could be an orange or lemon cake. To keep the price down, you'd have to make sure the design is such that you could produce a bunch with out headache.

I love the trucks in your gallery. Maybe just sell one. I don't know ANYTHING about carved cakes. But what I do know is that I would buy a 4 piece box of Godiva chocolates on a special ocassion even though the price in a normal circumstance to me seems ridiculous. How many people are looking for a unique thank you? SHOOT! Make a standard offering for a thank you gift! Technically, you could have a standard feminine and a masculine & then a seasonal. They could give the feminine and masculine for birthday or thank you or just because. Then, the seasonal is really optional.

If you could offer just a white gloss gift box and a simple ribbon, people would probably drop by and pick them up.....of course that speaking to a "standard offering". And, of course you'd put your store label on each box. Built in advertising!

Of course you wouldn't want to offer flexibility. That would compete with your custom carved cake pricing. So, small, one flavor, one style cakes - lower price point. The question is - what will people pay? And, how much time is worth the lower dollar amount?

If you don't want to do sheets, maybe this is another way to keep you more focused on your specialty. Or...in addition to sheets. See what works. Don't give up. If you make a tasty cake & have a unique decorating point of view, people will catch on. Take some samples around with a flyer of your new offerings. Put sample pics on your site.

Good Luck to you and keep your chin up!

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