What's Your %

Business By skaggs1 Updated 9 May 2010 , 12:44am by Kitagrl

skaggs1 Posted 8 May 2010 , 5:44pm
post #1 of 6

Just wondering what is your % of gross profit for each cake sale?

5 replies
costumeczar Posted 8 May 2010 , 10:41pm
post #2 of 6

Gross profit? You mean after the cost of the ingredients is taken out, or all materials? I think that my ingredients are usually less than 10% of the total money I bring in per week, but once you take out self-employment taxes and all other expenses I'm not making a 90% profit on each cake!

Kitagrl Posted 8 May 2010 , 10:58pm
post #3 of 6

Last year my taxable profits were about 58% of everything I brought in.

That counts EVERYTHING though...all expenses, things I had to buy to keep my business going, insurance, web costs, any equipment, donations, any business losses, etc. And then of course I did have to pay taxes on that 58% as well as self employment.

cheatize Posted 8 May 2010 , 11:22pm
post #4 of 6

Net sales minus cost of goods sold? In a custom business, that's tough to calculate. I would think the best anyone can give you is an average as each cake has different costs.

indydebi Posted 9 May 2010 , 12:40am
post #5 of 6

I'm not sure that gross profit is a good indicator. That's Selling Price Less COGS (cost of goods sold), i.e. ingredients only. But that's not the full cost of the cake. And those add'l costs can vary depending on location and overhead.

I've helped a few people really look at their costing. It's always amazing to them when they see that what they THOUGHT they were making is no where NEAR what they are really making, once they figure all of the other very real and very expensive costs involved.

Kitagrl Posted 9 May 2010 , 12:44am
post #6 of 6
Quote:
Originally Posted by indydebi

I'm not sure that gross profit is a good indicator. That's Selling Price Less COGS (cost of goods sold), i.e. ingredients only. But that's not the full cost of the cake. And those add'l costs can vary depending on location and overhead.

I've helped a few people really look at their costing. It's always amazing to them when they see that what they THOUGHT they were making is no where NEAR what they are really making, once they figure all of the other very real and very expensive costs involved.




No kidding. Alot of money changed hands last year, unfortunately the majority of it was NOT "mine"!!! And actually I did my math wrong...my net/taxable profit was only 42%...not 58%. Duh. haha.

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