tarheelgirl Posted 15 Jun 2010 , 12:43pm
post #1 of

really screw us home bakers who are charging appropriately! I'm legal which I'm sure most that sell are not. It really does get old. Do these bakers not realize they are giving cake away? Sure you are super busy and have to turn orders away but why would you want to run yourself ragged just to break even? In the meantime screwing everyone else in the area. I've had so many lately trying to "bargain" with me on price or sound like they just had a coronary when I gave them the price. icon_lol.gif I personally would rather be sitting in a nice cool pool then to make a cake for nothing! Please please.. LEGAL home bakers charge accordingly!!!

ok... I feel better now! icon_biggrin.gifthumbs_up.gif

51 replies
psurrette Posted 15 Jun 2010 , 1:06pm
post #2 of

I am a home baker but I charge more than most bakeries! I think what happens with most home bakers is they dont know what to charge becasue they dont have the expenses to pay. I feel why should I get less if I am a home baker I want more! I am more flexible!

Caths_Cakes Posted 15 Jun 2010 , 1:08pm
post #3 of

It all depends on the area i think, Im from the uk anyway, So i dont count lol, But i know if i charged, What i think is appropriate, A good deal for me AND the buyer . . Id never make one single sale! I have to be cheaper just to stay afloat, Does that mean im screwing other bakers who charge more than i do ? Screw the others, i charge what i have to charge to keep myself going, and im not going to feel bad for any one who thinks otherwise.

silverc Posted 15 Jun 2010 , 1:17pm
post #4 of

I am in the same situation. I am friends with two other home bakers in my area, and they both charge less than I do. I recently did a purse cake with a gumpaste shoe and pearls )in my pics). The cake was two different flavors, and would have fed 50 before I started carving. Both of the other bakers knew all of this info and said they would charge $75 for it. Their reason for not charging more is that people won't pay it. They are always booked solid. It doesn't make sense to me. They would pay it or go to Walmart if they would stop charging so little.

tarheelgirl Posted 15 Jun 2010 , 1:24pm
post #5 of

I know what is appropriate for my area and I started charging low to get started. I was booked week after week! Which was great but once I raised my pricing I was out of that "burn out" stage which made my job more enjoyable. After a couple of years I can finally say my prices are competitive with the area as well as most bakeries. Charging too low sets the standards/prices for others. I think.. I just need a vacation.. a really LONG vacation! LOL

SweetieVie Posted 15 Jun 2010 , 1:33pm
post #6 of

I've been torn on the subject. I personally am not one who would spend what I charge to make a cake, BUT what we do is so different than the typical bakery. If someone wants a basic cake (which isn't that fun for me to make) let them go somewhere else. I want to make cakes I can be proud of. I have to make it worth my time. Would anyone else work at the hourly rate we do??

-K8memphis Posted 15 Jun 2010 , 1:39pm
post #7 of
Quote:
Originally Posted by Caths_Cakes

It all depends on the area i think, Im from the uk anyway, So i dont count lol, But i know if i charged, What i think is appropriate, A good deal for me AND the buyer . . Id never make one single sale! I have to be cheaper just to stay afloat, Does that mean im screwing other bakers who charge more than i do ? Screw the others, i charge what i have to charge to keep myself going, and im not going to feel bad for any one who thinks otherwise.




First of all I think we're speaking hypothetical but...What can happen is that you get your business going because your pricing is cheaper and more attractive to the masses. So you're thriving with business.

Then you notice that when people carry a cake out of other shops they left twice as much money behind than you're getting. But the clinetelle you built will not pay those prices so you have to generate a whole new customer base or continue working twice as hard for the same money. Not smart.

It's not fair to you or anyone to underprice.

Friends don't let friends undercut.

costumeczar Posted 15 Jun 2010 , 1:42pm
post #8 of

A lot of the time, when people decide to get legal they'll realize how little they've really been earning once all of their expenses are added in, and they'll start charging accordingly. There's always going to be a craigslist cheapo who undercuts everybody, but they won't be around long if they're ripping themselves off.

PiccoloChellie Posted 15 Jun 2010 , 1:45pm
post #9 of

I think these problems come up when a home baker doesn't view what they're doing as a business. They're selling cakes "on the side" or doing it to make a few extra bucks, and feel that making an extra, say, $50 per week over what they pay in materials is profit in their pocket. They don't look at the fact that they're making like half minimum wage not counting the extra utility use and incidental expense (soap, paper towels, etc).
Unfortunately it's because, well, not everyone is cut out to be a business(wo)man. Most people don't have it in 'em. They don't have the business sense that a Bill Gates or an indydebi has, for example, and they don't have the brass cakeballs it takes to be a business owner. How many times do we see posts here about needing a backbone when it comes to charging what a cake is worth? It takes one heck of a backbone to not cave to customers who want a custom cake for Walmart prices, and it takes serious cakeballs to stick to that pricing no matter what.
It also takes a lot of not-so-fun work like cost analysis/job costing, accounting, salesmanship, time management, and all that other stuff that sucks about running a business. It's stuff that the average person never had to deal with as an employee of someone else, and from my reading it seems like a whole lot of home bakers just haven't had business experience beyond working for an employer.

The hobbyist home baker who drastically undercharges for their cakes doesn't rely on caking as their primary -or even secondary- income. If they did, they'd be living in a van down by the river. They never bothered to take the time to do a job costing of a single cake and apply it to their product like an actual business does. They have no interest in doing any of the unfun stuff that's the backbone of running a business and, in some cases, have absolutely no clue what any of that unfun stuff actually is. It's rampant, and we all see it every single day.

The way I figure it...all you can really do in most cases is just wait it out. They'll either get over their passing cake decorating fancy, they'll eventually get sick of making $50 a week at the expensive of every moment of their free time, or some other bad business decision will send their customers running. I suppose others will crop up, but if you're doing things right, you stand a better chance at lasting them all out.

tarheelgirl Posted 15 Jun 2010 , 1:52pm

I learned the hard way.. When I first started out I had no idea how much to charge. I "thought" to get my business started I had to be super low in price. After being on CC I finally learned that it wasn't worth doing a ton of cake and being super booked without making much was the way to go. It took maybe 6 months of STRESS.. I raised my pricing and let me tell you.. the ones who had gotten cakes from me started balking at my higher prices. I have had to weed out the cheapos from the ones who really want a nice cake and expect to pay more. So, yes charge accordingly now or it will be hard to come out of that customer base you have already made.

splash2splat Posted 15 Jun 2010 , 1:52pm

I am a legal baker out of my home and the people in my area do not want to pay anything. They have the idea that if I can do it then they must be able to do it for a whole lot cheaper. I was asked to do a four tier wedding cake with several different gumpaste flowers cascading down the side. I explained that it would be $390 and then about died - they told me they could make the same cake for $25.00. It gets old!

Katiebelle74 Posted 15 Jun 2010 , 1:57pm

PiccoloChellie I think you are exactly right. I had enough trouble deciding what I should charge and I know 3 local cake business owners that I consulted with to figure things out in the beginning plus years of Exec. Pastry experience/degree and cake boss program to cost out things... but taking a guesstimate on what that funky 3d cake you've never done before should cost is still tough for those of us with experience. Now you take a hobbyist or the new wanna-be with out experience and they've no clue at all what they are up to on the business side EVEN if they can execute the cake.

PiccoloChellie Posted 15 Jun 2010 , 1:59pm
Quote:
Originally Posted by splash2splat

I was asked to do a four tier wedding cake with several different gumpaste flowers cascading down the side. I explained that it would be $390 and then about died - they told me they could make the same cake for $25.00. It gets old!




Let 'em try to make it themselves. For $25. *snort* Every guest at that wedding will be rushing to an actual, experienced baker for their next important cake when they see the cluster on the cake table.
And then... "OMG, did you HEAR about Jane's wedding cake??? Her mom's sister's cousin's hairdresser's nephew's friend made it and it fell over/made people sick/looked like an elephant sat on it/tasted like cowpies!"
And after all is said and done, that "$25 cake" turned into $400 of supplies, ingredients, and failure.

(I apologize for my snarkyness this morning - I must be in some kind of mood!!)

-K8memphis Posted 15 Jun 2010 , 2:07pm

Piccolo you are in rare form and have made me laugh out loud with the brass cakeballs and living in a van comments from upthread.

No worries!!!

High five!!!

Caths_Cakes Posted 15 Jun 2010 , 2:16pm

Believe me, i started out the cruddy way, Charging way less than i should have, And i learned the hard way!
i would love to be be able to say im making a mint and getting rich of making 3 cakes a month *snorts* as before, 90% of the population in my area will just not pay above the price for cake, they know they can go to asda and get a cake for less than £10 and there's no way in the world i can compete with that if i want to not live in a tent in a field some where lol! I'm just saying, Alot of it does depend on the area,and taking that into account is important.

PiccoloChellie Posted 15 Jun 2010 , 2:19pm
Quote:
Originally Posted by Katiebelle74

PiccoloChellie I think you are exactly right. I had enough trouble deciding what I should charge and I know 3 local cake business owners that I consulted with to figure things out in the beginning plus years of Exec. Pastry experience/degree and program to cost out things... but taking a guesstimate on what that funky 3d cake you've never done before should cost is still tough for those of us with experience. Now you take a hobbyist or the new wanna-be with out experience and they've no clue at all what they are up to on the business side EVEN if they can execute the cake.




I'm remarkably lucky in that one of my previous jobs I was responsible for all the job costing for all products for two companies under one "umbrella." I had to sort out every little thing that went into each job - from the sheets of paper and ink used to print out the production schedules to the labor to the exact amount of time each item spent on each machine. It was tremendously complex, but it's the only way the company knew how much to charge for the products!
Those were marketing materials and had absolutely nothing to do with caking, but when I decided to follow my dream, the FIRST thing I did was job cost my practice/family cakes the same way I job costed those production orders.
It took time just to get my baselines sorted out and then to bring those in line with established businesses in the area. It took a lot of time. It took time that the hobbyists and wannabes have no desire to take, and quite possibly have no idea how to even start doing it.
(and, as an aside, I'm still struggling to not think of myself as a wannabe... but this is a business and I am a businesswoman! I have one of my new business cards taped to my desk directly in eyesight to remind me of that every day!)

It took me 3 years of planning to get to the stage that I felt ready to do this for real. My competition is NOT the person who makes one star-tip character pan and figures they can get rich quick selling them for $15 to the Walmart customers. And those Walmart customers are not my customers. I'm okay with that. My prices are my prices. I have two "budget cakes" available for those who want something a little fancy but can't afford to spent $75 on a cake and everything else is available to those who view fresh, custom, delicious dessert as something important.

EDIT: Katie, could you perhaps stop off at the Penguin and grab me a couple(dozen) orders of fried pickles and deliver them up here to the Great White North? I lived in Charlotte for several years and oh, God do I miss the food.....

mom2spunkynbug Posted 15 Jun 2010 , 2:22pm
Quote:
Originally Posted by RoccosMom

Piccolo you are in rare form and have made me laugh out loud with the brass cakeballs and living in a van comments from upthread.

No worries!!!

High five!!!




Ditto!!! icon_lol.gificon_lol.gificon_lol.gif

-K8memphis Posted 15 Jun 2010 , 2:23pm
Quote:
Originally Posted by Caths_Cakes

Believe me, i started out the cruddy way, Charging way less than i should have, And i learned the hard way!
i would love to be be able to say im making a mint and getting rich of making 3 cakes a month *snorts* as before, 90% of the population in my area will just not pay above the price for cake, they know they can go to asda and get a cake for less than £10 and there's no way in the world i can compete with that if i want to not live in a tent in a field some where lol! I'm just saying, Alot of it does depend on the area,and taking that into account is important.




I agree that taking the area into account is very important and if my area will not pay my price then my decision would be to get into a different line of work.

I set my price. I control my work. Nothing worthwhile is easy. It's easy to say oh yeah they can get a cheaper cake somewhere else. It's hard to market yourself.

Do people in the designated area drive cars and eat out and sometimes get new clothing and ipods and new electronic gadgets? The income is out there you just gotta mine for it.

Just some 'I'm much more important than that' thoughts for you.

I mean you said it yourself--market to the other 10%!!!!!!!!!!!!!!!

smokeysmokerton Posted 15 Jun 2010 , 2:45pm

Lots of home bakers seem to start out underpricing, but shouldn't it be the other way around? If you base your price starting out around the highest quotes for your area, you either do well and stay at those prices, or you can lower them a little at a time based on what you need to make and what your area is willing to pay. At least that way you don't have to worry about losing clients because you had to raise your rates, plus the added bonus of being able to compare the amount of orders you had at higher prices to the ones with the lower prices and being able to tell if your profit has changed. If you can do three cakes a month as opposed to 10 and make the same amount of money, maybe you were in the right place to start with.

Caths_Cakes Posted 15 Jun 2010 , 2:48pm

thats just it Roccos mom, I cant just market to the other 10%, I do sell to them, And usually they are bigger cakes because the person is willing to pay it , But i cant have one price of cake for one person, and one for another just because i think they look a bit better off, The majority of cakes i do are small and mostly for things like birthdays and christenings and thats because they will look at my list, and get what they can with what they can, which usually isnt much . i don't consider myself to be cheap and im not aiming to be cheap just so i can get more customers, If that worked, we'd all be doing it!

-K8memphis Posted 15 Jun 2010 , 2:57pm

Caths_Cakes, I see what you mean and whatever works for you.

Me, I will market to the people who can afford me. Often when pople celebrate they come up with budgets that normally do not exist--the family goes in on G'ma's 70th b-day party stuff like that--I'm there for them.

Stuff like that.

All the best to you.

cakegroove Posted 15 Jun 2010 , 3:23pm

I am new to this business so I have been afraid of charging too much myself. The first few cakes I did, I did it for my cost and nothing else, simply because i was happy to be getting the experience. However, a few days ago my best friend asked me to do her grandma's 75th birthday cake. She had a picture of a cake from a grad party she had attended and wanted the same thing. It was 3 tiered square, each tier 3 layers, each tier 3 different flavors, to feed 100 people. Buttercream with fondant cut-outs. She said the woman who did it for that grad party did that cake for $80, and she was looking to get it for that price as well. I gracefully declined the job. I still feel like I could have used the experience with a tiered square cake but that is charging less than $1 per person.

kimmisue2009 Posted 15 Jun 2010 , 3:23pm

I think it's important to remember that people simply do not know what it takes to crank out these types of cakes. I know this, because I was one of them. I decided I could do it for family and friends and give people the benefit of high-end cakes for low-end prices. I felt all philanthropic and crap. But, let me tell you, after trying to do three cakes in one weekend (I have a full-time job and hour away from my home) I almost commited cake-icide. I cannot fault the people, though. They wanted a good deal and I was offering. Of course, then I found out that I was commiting a huge crime by even accepting the pennies that I did. I feel extremely guilty every time I think about the people in my town who have actually taken the time to train and acquire licensing.

I am now taking a hiatus from any caking, learning to actually produce some quality work, so that one day I can become licensed and offer a good product that I will feel comfortable charging fair market prices for.

smokeysmokerton Posted 15 Jun 2010 , 3:35pm
Quote:
Originally Posted by kimmisue2009

I felt all philanthropic and crap.




icon_lol.gif

dawncr Posted 15 Jun 2010 , 3:45pm
Quote:
Originally Posted by PiccoloChellie

I think these problems come up when a home baker doesn't view what they're doing as a business. They're selling cakes "on the side" or doing it to make a few extra bucks, and feel that making an extra, say, $50 per week over what they pay in materials is profit in their pocket. They don't look at the fact that they're making like half minimum wage not counting the extra utility use and incidental expense (soap, paper towels, etc).
Unfortunately it's because, well, not everyone is cut out to be a business(wo)man. Most people don't have it in 'em. They don't have the business sense that a Bill Gates or an indydebi has, for example, and they don't have the brass cakeballs it takes to be a business owner. How many times do we see posts here about needing a backbone when it comes to charging what a cake is worth? It takes one heck of a backbone to not cave to customers who want a custom cake for Walmart prices, and it takes serious cakeballs to stick to that pricing no matter what.
It also takes a lot of not-so-fun work like cost analysis/job costing, accounting, salesmanship, time management, and all that other stuff that sucks about running a business. It's stuff that the average person never had to deal with as an employee of someone else, and from my reading it seems like a whole lot of home bakers just haven't had business experience beyond working for an employer.

The hobbyist home baker who drastically undercharges for their cakes doesn't rely on caking as their primary -or even secondary- income. If they did, they'd be living in a van down by the river. They never bothered to take the time to do a job costing of a single cake and apply it to their product like an actual business does. They have no interest in doing any of the unfun stuff that's the backbone of running a business and, in some cases, have absolutely no clue what any of that unfun stuff actually is. It's rampant, and we all see it every single day.

The way I figure it...all you can really do in most cases is just wait it out. They'll either get over their passing cake decorating fancy, they'll eventually get sick of making $50 a week at the expensive of every moment of their free time, or some other bad business decision will send their customers running. I suppose others will crop up, but if you're doing things right, you stand a better chance at lasting them all out.




Chellie,
Every once in a while, a post will articulate an issue or theme underlying hundreds of topics on a forum. You've done it here. Bravo.

However, the ones described in your post are the ones who won't 'get' the valuable advice you've offered. The ones who do 'get it' need to just take a deep breath and feel secure that they will be the ones who last in the long run.

icon_smile.gif

Adevag Posted 15 Jun 2010 , 3:54pm
Quote:
Originally Posted by kimmisue2009


I am now taking a hiatus from any caking, learning to actually produce some quality work, so that one day I can become licensed and offer a good product that I will feel comfortable charging fair market prices for.




Same with me (plus waiting to live in an area where I can legally have a home business). If anyone does not know how much their cake is worth, feel guilty for accepting money for hours of hard work, then they should still be hobby bakers, IMO. Why start a business when you don't even know how much to charge? There has been so many threads about pricing questions that I just added it here, sorry. But I don't understand how anyone can sell a cake and later wonder if they charged right, too much, too low or what they should have charged. How can anyone start baking a cake (as a professional) without knowing how much or even IF you will be paid for it? And if profit is not in their business plan, then it's better to do it as a hobby. (not toward kimmisue, I just agreed with what she said...)

langranny Posted 15 Jun 2010 , 4:04pm

You couldn't even buy the materials to bake a 4-tier cakes for $25...

PiccoloChellie Posted 15 Jun 2010 , 4:09pm
Quote:
Originally Posted by dawncr

Chellie,
Every once in a while, a post will articulate an issue or theme underlying hundreds of topics on a forum. You've done it here. Bravo.

However, the ones described in your post are the ones who won't 'get' the valuable advice you've offered. The ones who do 'get it' need to just take a deep breath and feel secure that they will be the ones who last in the long run.




I figured some people would "get" what I was trying to say.
I'm glad it came across as intended.

I have no idea if my business will succeed, but I'm approaching this as a business and did my homework before I took a single dollar. I know I have a better chance at success than those who have not done their homework and continue to refuse to do it in a proper businesslike fashion... if yer pickin' up what I'm puttin' down.



Quote:
Originally Posted by Adevag

If anyone does not know how much their cake is worth, feel guilty for accepting money for hours of hard work, then they should still be hobby bakers, IMO.




BIGGEST PET PEEVE EVAR!!!!!!!!

If one feels "guilty" about taking money or, even worse, is too timid/shy/etc to DEMAND money for their product
(i.e. dropping a cake off and not taking payment, and then not wanting to pursue the "client" for payment)
then one is NOT running a business. That is a lack of the business sense I mentioned earlier. Thems are the brass cakeballs required. If you ain't got 'em, you ain't got a business; you have a charity where you get taken advantage of.
General "you," not specific "you," BTW.


Quote:
Originally Posted by Adevag

How can anyone start baking a cake (as a professional) without knowing how much or even IF you will be paid for it? And if profit is not in their business plan, then it's better to do it as a hobby.




Because they're not baking a cake as a professional. They're baking a cake as someone with a hobby. It's a hobby that they obviously love, but it's not a business.

splash2splat Posted 15 Jun 2010 , 4:11pm

PiccoloChellie I love you response!

kAnd when I was told they could do it for $25.00 I told them I really find that hard to believe but be my guest. It's really interesting the people you get to meet.

kimmisue2009 Posted 15 Jun 2010 , 4:18pm

That was exactly my point. I have zero head for business. Take that back - I have zero interest in business. I am a researcher/statistician by day and the cake thing was to be my counter-balance to keep me from going insaner (not a typo - already a bit insane.)

I think that once I did one cake and heard all the "omg - you should do this for money....blah blah blah blah) I lost my head for a second. I simply do not care a bit about getting rich of cakes, even in the event that the Goddess of Cake reigned down on me and gave me magic hands.

I just got really sad when I would think of all the little girls who wished they could have a cool funky cake when they had parents who simply could never afford such a luxury.

That said, I can still "practice" on people who are grateful just to have something without causing woes to the actual cakers in my area.

Believe me, I do not even need to be told how ridiculously I thought for a few months. I do, however, always welcome honesty. If you are worth my time, you are worth my honesty.

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