American Pricing

Decorating By mireillea Updated 2 Apr 2010 , 2:32pm by peg818

mireillea Posted 2 Apr 2010 , 10:01am
post #1 of 7

I am just curious: how come prices for cakes are sooo different in the various parts of the United States?
I come from a small country. Here, we have some kind of general rule about pricing. A wedding cake in the North will cost about the same in the South.
But in the past three years on CC, I have seen many posts from different parts in the US, where the same quality of wedding cake (IMO) will cost 1 dollar in say North Carolina, and 8 dollars on the West Coast. Is this due to more competition in certain parts in the US? Less interest in a commercial product (more people that bake themselves)? Hype (like it is a trend to buy a cake from a certain designer)?

Would love to know!

6 replies
karateka Posted 2 Apr 2010 , 10:07am
post #2 of 7

I think it's all about charging what the market will bear. Now, I'd love to have a $1000 minimum here in Cincinnati like Duff has in Baltimore, but nobody would be willing to plop down that kind of cash for anything short of a major wedding in this area. Heck, I can't even convince people to eat fondant. There is money here, but it isn't spent on cakes. I wanted to charge $1000 for a very detailed 3D cake for a corporate event and they told me it was too much. I guess it's all in priorities......

Bigger metropolitan areas, highter cost of living, more high paying jobs with more status conscious clientele all contribute to being able to charge more.

Of course, there are exceptions to every rule, and you will find exceptionally talented decorators in every area of the country for extremely reasonable prices....and there are always horror stories about the opposite end of the spectrum.

mireillea Posted 2 Apr 2010 , 10:20am
post #3 of 7
Originally Posted by karateka

but nobody would be willing to plop down that kind of cash for anything short of a major wedding in this area. Heck, I can't even convince people to eat fondant. There is money here, but it isn't spent on cakes.

So it is not about poorer areas where people just don't have enough money to spend it on a luxury as cakes. That is interesting: you say it is not a money thing but a mentality thing. They consider cakes not worth a lot of money.

MnSnow Posted 2 Apr 2010 , 12:28pm
post #4 of 7

It's really simple demographics.
There are areas of the US that have hiher incomes--higher populations--higher education and then there are areas that are lower.

You can only charge what your demographics will allow.

For example (to borrow Debi's wording) I want to own a mercedes but live in an area that income only allows for a Pinto--which one do you think I will be owning?

When figuring pricing and to do a business plan--you need to look at your areas demograpics--that's where the Census statistics come into play. If your areas median income is white collar, then you can price accordingly--if your areas income median is middle class and blue collar--then you rpice accordingly. Consumer prices fall into the demographic realms.

peg818 Posted 2 Apr 2010 , 12:38pm
post #5 of 7

With the US being such a large country, there are big differences in costs. More densely populated areas cost more to live, these people get paid more and are used to paying out more. That means in those areas you can charge more for a cake.

Even areas that are only separated by a couple of hours prices can vary greatly, I'm only a couple of hours north of nyc but i could never command the prices that some bakers get there.

mireillea Posted 2 Apr 2010 , 1:58pm
post #6 of 7

Hi MnSnow and peg818,
Of course I would understand if it were only to do with demographics> higher incomer> more spending on luxury.
However, I often see comments like:
"People just don't want to pay for my cake while it is high quality"
"HI XXX, why are you pricing only 1 or 2 dollar per serving? You are really underpaying yourself" etc.
That made me wonder if there was some sort of price concensus.

peg818 Posted 2 Apr 2010 , 2:32pm
post #7 of 7

Much of it is demographics. But some of it is the clientele that you serve. If you are looking to serve the high end cake needs, you limit yourself and charge through the nose for a cake (if you can do this great). If you are looking to serve everyone then you price to the bottom and work your butt off. IF you are looking to work a bit on the smarter side you price middle of the road and you should stay busy with out killing yourself.

And some of the pricing thing and pricing so low is that most of the people home doing cakes are women, and as women we are taught that our time isn't as valuable as a man. Its a mentality that we really need to get over, but its still there none the less.

Of course you need to know i don't do this for a living, i personally don't want to work that hard.

Quote by @%username% on %date%