snarkybaker Posted 19 Jan 2010 , 1:54am
post #1 of

I almost never stray from the business forum, and one of the main reasons is my propensity to pop an aneurysm every time one of these lamentation threads about pricing pops up.

" People won't pay..." " Wants a Walmart cake..." etc.

In the 2 years we've been open in the new shop, not once has someone told me they could get the same cake elsewhere for less money. The tell me they can't afford me ( rarely) or they tell me I am more expensive than someone else, but they never question that they are getting a better cake for the extra money.

If you are getting a lot of price resistance, it just means you aren't done selling yet. People will pay the value they perceive. Part of your conversation, long before you quote a price, needs to be the building of value. ie : " We don't use food products from a craft store, which is pretty common around here. We use a fondant recipe from a Swiss chocolatier, we have our own special blend of real vanilla made from both Tahiti and Madagascar beans..." etc.

If they continue to push back, offer them a less elaborate cake than you have talked about. It's called the " take -away " close. People don't like being told they can't have somethng they want. IE : " We can certainly make you a cake for $200, but at $25 an hour for the decorator, we would need to do one stooge figurine, not three..."

We had a woman come in with her 2 daughters for a wedding cake on Friday. The older daughter told me " When I was at school, I would walk past your windows everyday, and I knew I wanted my wedding cake from here". Ka-ching!! I thought. She told my catering manager she had a $500 budget...for 250 people, BTW. If I weren't confident in my product and the VALUE of my cake, I would have just spun my wheels, and probably not sold a cake, but instead I went to the table, sat down, sketched a cake, and talked with the bride about what she liked about the two different cakes she brought in. The cake I sketched was a $7/serving, plus about $200 for fresh flowers, so I quoted her $1950....and she handed over her credit card and gave me a $1500 deposit.

We quote and sell $500 plus cakes all the time, 3 to 4 a week, plus all the regular $50 - $80 cakes we do. And while I think we make great cakes, a lot of you are super talented, and worth every bit as much as we charge. If they don't want to pay, then they are not a customer, they are just a looky-loo. Don't take personally. Don't settle for less than you are worth.

53 replies
antonia74 Posted 19 Jan 2010 , 2:03am
post #2 of

Can we get some APPLAUSE emoticons around here??????

That was excellent advice!!!! thumbs_up.gifthumbs_up.gifthumbs_up.gifthumbs_up.gifthumbs_up.gif

You are one heck of a smart business person, Snarkybaker. I'd love seeing more of your posts around here. icon_smile.gif

prterrell Posted 19 Jan 2010 , 2:06am
post #3 of

Woot! go snarkybaker! you rock!

weirkd Posted 19 Jan 2010 , 2:14am
post #4 of

Wow. Well put!
I actually get a lot of people saying that they go to a baker that is outrageous in price. I had a bride tell me she went to a local cupcake baker and asked for pricing on 100 cupcakes. They quoted her $1600 for just the cupcakes and then $600 for delivery. Now she showed me what she wanted and really, the only thing I could think of is they were trying to get rid of her. I probably could get a lot more money for my cakes but I dont feel right charging people something like $16 a cupcake!

leah_s Posted 19 Jan 2010 , 2:16am
post #5 of

:clap::clap::clap:

good job!

snarkybaker Posted 19 Jan 2010 , 2:25am
post #6 of
Quote:
Originally Posted by weirkd

Wow. Well put!
I actually get a lot of people saying that they go to a baker that is outrageous in price. I had a bride tell me she went to a local cupcake baker and asked for pricing on 100 cupcakes. They quoted her $1600 for just the cupcakes and then $600 for delivery. Now she showed me what she wanted and really, the only thing I could think of is they were trying to get rid of her. I probably could get a lot more money for my cakes but I dont feel right charging people something like $16 a cupcake!




So charge her $12, and if your feeling skippy, throw in the delivery. If you feel bad about it, donate the money to the homeless or something, but I'd be whistling all the way to the bank.

Renaejrk Posted 19 Jan 2010 , 2:25am
post #7 of

I was cracking up when you said she handed you her credit card!!!! hahahahahaha

indydebi Posted 19 Jan 2010 , 2:26am
post #8 of

This should be a sticky of "Read This Before Asking a Pricing Question or Contemplating Opening a Business"! and should be mandatory reading for everyone!!!

Ditto on the applause icons request!!

mjballinger Posted 19 Jan 2010 , 2:27am
post #9 of
Quote:
Originally Posted by snarkybaker

We don't use food products from a craft store, which is pretty common around here. We use a fondant recipe from a Swiss chocolatier, we have our own special blend of real vanilla made from both Tahiti and Madagascar beans...




What a suave business woman you are! You believe in your product and aren't afraid to sell it for what it's worth. Good for you! That's the kind of thing that would definetely sell me - if I know I'm getting premium ingredients and talented decorators, I'd WANT to spend the extra money. You go girl!!!

snarkybaker Posted 19 Jan 2010 , 2:32am
Quote:
Originally Posted by mjballinger

"We don't use food products from a craft store, which is pretty common around here. We use a fondant recipe from a Swiss chocolatier, we have our own special blend of real vanilla made from both Tahiti and Madagascar beans..."

What a suave business woman you are! You believe in your product and aren't afraid to sell it for what it's worth. Good for you! That's the kind of thing that would definetely sell me - if I know I'm getting premium ingredients and talented decorators, I'd WANT to spend the extra money. You go girl!!!




And that is really the point. If you are having trouble getting a fair price, You haven't sold it yet." You gotta make 'em want it!

FromScratch Posted 19 Jan 2010 , 2:32am

WHOOT!!

I love this. Couldn't ring more true.

I'd be whistling to the bank too with the cupcake quote... ka-ching ka-ching ka-ching!!!!

prterrell Posted 19 Jan 2010 , 2:33am

I paid more for my wedding cake than I did for my wedding dress (everyone thought we were nuts). It was worth every penny. Makes more sense to me to pay more for the cake, but then I am a cake girl!

snarkybaker Posted 19 Jan 2010 , 2:40am
Quote:
Originally Posted by prterrell

I paid more for my wedding cake than I did for my wedding dress (everyone thought we were nuts). It was worth every penny. Makes more sense to me to pay more for the cake, but then I am a cake girl!




We send a lot of cake to very modest venues. There is a decent sized subset of the population who will pay premium dollars for premium cake... and they are not all Richie Rich's from Richistan.

Those are your customers, to heck with the rest.

greengyrl26 Posted 19 Jan 2010 , 2:51am

snarkybaker...I think I love you!!!

I kind of fell into this business (I know, don't yell at me!), but now, of course....I'm completely hooked. Line, sinker & all. The only reason I ever decorated my first cake, is because a friend asked me to. She loved the taste of my cakes and was certain that I could "make it pretty" as well. (I was a graphic designer in a past life, and she knew that too). Anyway...I gave it a try, it came out really nice and I fell in love.

I made her cake for free, as a gift. And from there, people started asking me to make them. I had no idea what to charge or how long it takes to decorate them, and severely, SEVERELY underpriced them. Then I got scared to raise my prices, afraid no one would pay. Well...you're right. They do! I had one customer (another friend) pay more than I asked her, because she said I was wayy to cheap. After that, I only quoted full price.

Sure, I've had a few people ask for quotes, only to be never heard from again. Who cares! Less stress for me! The last cake I did, I was worried about. He was a repeat customer, and he found me when I was really underpriced. I told him how I'd had to raise my prices, time consumed, cost of materials, etc. He didn't even blink. Said..."You're right! And hey...you can't put a price on perfection!"

So, you're right snarkybaker. You're absolutely right! Believe in your product, and the customers will too!!!

prterrell Posted 19 Jan 2010 , 2:55am
Quote:
Originally Posted by snarkybaker

Quote:
Originally Posted by prterrell

I paid more for my wedding cake than I did for my wedding dress (everyone thought we were nuts). It was worth every penny. Makes more sense to me to pay more for the cake, but then I am a cake girl!

We send a lot of cake to very modest venues. There is a decent sized subset of the population who will pay premium dollars for premium cake... and they are not all Richie Rich's from Richistan.

Those are your customers, to heck with the rest.




Well, considering my reception was in the church fellowship hall, I'd call it definitely modest! icon_lol.gif

Loucinda Posted 19 Jan 2010 , 3:06am

That is some of the best info I have read in a while, and it is appreciated.

ApplegumKitchen Posted 19 Jan 2010 , 3:14am
Quote:
Originally Posted by weirkd

Wow. Well put!
I actually get a lot of people saying that they go to a baker that is outrageous in price. I dont feel right charging people something like $16 a cupcake!




I sell lots of cupcakes for $15 each icon_redface.gif

They are NOT a packet mix - they have a core of ganache and detailed fondant work - they are time-consuming to say the least!


I HAVE calculated my prices correctly though - using VERY detailed processes and if I sold them for less I would be treading water... regardless of whether I feel RIGHT about the price or not.
LL

mkolmar Posted 19 Jan 2010 , 4:16am

I LOVE THIS! Spot on.

in2cakes2 Posted 19 Jan 2010 , 4:59am

This is the stuff I need and want to hear!! Thanks for the great advice!!

mireillea Posted 19 Jan 2010 , 10:35am

Snarkybaker,

You rock! I couldn't agree more! thumbs_up.gifthumbs_up.gifthumbs_up.gif

costumeczar Posted 19 Jan 2010 , 12:04pm

But how much should I sell this cake for??? Just kidding, thanks for posting this. If people don't think of their business as a business that's the problem, and they'll never get past that. Selling is part of business, it's not all fun and decorating. But it is fun when they hand you the credit card! thumbs_up.gif

_Jamie_ Posted 19 Jan 2010 , 12:55pm

Oh hells yeah. This should be stapled to everyone's forehead upon entering CC! icon_biggrin.gificon_biggrin.gif

Mike1394 Posted 19 Jan 2010 , 1:26pm

Great post. icon_biggrin.gifthumbs_up.gif

Mike

Jenteach Posted 19 Jan 2010 , 2:02pm

I don't post much here, but I read LOTS and I don't sell cakes as a business. This post is exactly what is needed here. I agree, everyone who will be selling a cake or wanting to start a business should read this post.

thumbs_up.gifthumbs_up.gifthumbs_up.gif

Jen

Mensch Posted 19 Jan 2010 , 5:01pm

this is, without a doubt, the best thread so far this year.

lilthorner Posted 19 Jan 2010 , 5:32pm

snarky, I just had to read this to my husband.. this is SPOT on advice (I love you in all your snarkiness anyway!)

Kitagrl Posted 19 Jan 2010 , 5:35pm

I'm always reminded of this when I get a few "I can't spend that much on cake." and then I get one who wants an elaborate cake and they get their price and say "Oh cool, great."

Hmmm. haha.

The people who have done their homework will know they have to pay a premium price for a premium cake.

tracycakes Posted 19 Jan 2010 , 6:36pm

Snarkybaker....YOU ROCK! thumbs_up.gifparty.gif

Great pricing thread! I know that I could not have started business and be anywhere without CC and the great, experienced people that share their knowledge.

I used to be one of those that was afraid to charge, afraid people might not like it...not anymore. My hubby has realized that it is a waste of time for me to make 9x13 sheetcakes, although I will do them just to get my name and cakes out there. I just opened last fall and still building my clientele. I don't worry when someone calls and complains that they can't pick up a cake for 10 people for $10 right this minute...they aren't my customer. My customer is the lady that called and WANTED a fondant cake that looked like packages and was thrilled to be able to get it. My customer is the one that called excited because she found me and could get a custom cake, understands the cost and wants something fun for her twin's turning 18.

Before I opened, I actually raised my prices from what I thought I was going to charge. I just had new brochures printed but when I have them printed again (it could be 6 mos or more), I'm likely to raise them again.

Snarky, you and all of the others that do get paid for what you do, inspire the rest of us who weren't (or aren't icon_wink.gif ) as confident in our cakes.

prterrell Posted 19 Jan 2010 , 6:43pm

Wow! Applegumkitchen! Those are some awesome cuppies! I'd gladly pay $20 for one of those, so your price is a steal! icon_biggrin.gif

HarleyDee Posted 19 Jan 2010 , 6:46pm

Yeh, this should be a mandatory read when you sign up here.

"To complete yur registration, please READ this!" icon_biggrin.gif

Applause indeed thumbs_up.gif

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