Importance Of Advance Payment

Business By Rose_N_Crantz Updated 3 Sep 2010 , 1:31pm by Baker_Rose

Rose_N_Crantz Posted 27 Aug 2010 , 2:34am
post #1 of 21

I know this topic has been beat into the ground already, but I just wanted to post an example from a slightly different viewpoint on the topic.

Most people on here are from custom cake shops, who already have a deposit policy in place. I work at a grocery store bakery where our policy is "pay when you pick up the cake." I've only had about a handful of people ask about if they need to pay when they order or when they pick up. Obviously, we don't have too many people complain about this. But our cakes are cheap enough that it wouldn't be a huge deal for payment before the cake is done.

BUT, I did a little experiment this week. I kept an eye on the orders that never got picked up. So far (and it's only thursday) we've had 2 full sheets, 1 half sheet and 3 10" round cakes left behind. Full sheets are $34.87, half sheets are $19.87 and 10" rounds are $12.34. That means a total of $126.36 we are losing. Doesn't seem like a whole lot, but consider this:

The total amount of work that went into those items, probably would have been around 1.5-2 hours (including set up, break out, clean up). That's 1.5-2 hours I could have spent working on something I would have gotten a return on. Such as carrot cakes. I could have done about 24 carrot cakes in that time. Or 30 boxes of 30 count cupcakes. Or 24 coconut cakes. Or 24 fudge cakes. See what I mean?

When I think about it this way, and I most often do, it really makes me wish we had an advance payment policy in place.

20 replies
sweetonyouzz Posted 27 Aug 2010 , 5:56am
post #2 of 21

You are all going to think I am nuts but I never do deposits. I take credit and debit cards and I accept checks if they pay 2 weeks before pickup but I never take deposits...the only exception to the rule is if they book a wedding for next year, I charge them 25 to 50 bucks to hold the date.

Please do not be harsh with me!!!,,,lol

step0nmi Posted 27 Aug 2010 , 6:07am
post #3 of 21

wow! that's a whole lot of money to be loosing if it was on a regular basis. do you think that tracking this and bringing it to management you may be able to get the policy changed? just a thought

cakesdivine Posted 27 Aug 2010 , 1:25pm
post #4 of 21

Talk about shrink! That is why grocery store bakery department manhours are always under scrutiny! When I was a bakery manager at Randall's in Houston I ended up only having 1 bakery clerk, 2 bakers and one decorator other than me, and my bakers and decorator didn't speak English so they kept failing on their secret shop scores. They forced my decorator to work overnight when the store was closed, the bakers did not have to do any customer contact, and so my bakery clerk who was part time and I were the only front people to deal with customers. Made my job extremely hard and stressful! But the upper management refused to let me hire another decorator and another bakery clerk. They limited the man hours I could schedule. Totally sucked! The main reason I quit working for them! I ended up working 16 hour days, then getting yelled at for the overtime. But, I was the only one allowed to have overtime! I even showed them that the only way to use the amount of man hours they were allowing me was to close the bakery 2 full hours earlier than the other departments each day (meat, deli, pharmacy, florist), as the amount didn't even cover the open hours of the bakery.

As far as those that don't take deposits...you do so at your own risk...LOL! You will at some point get burned and like the rest of us realize the error of your ways and correct the issue icon_smile.gif

Rose_N_Crantz Posted 27 Aug 2010 , 4:51pm
post #5 of 21
Quote:
Originally Posted by step0nmi

wow! that's a whole lot of money to be loosing if it was on a regular basis. do you think that tracking this and bringing it to management you may be able to get the policy changed? just a thought




I've thought about that, but it would have to be a company wide change and our company is nation wide. I might anyways though. Could look good on my part.

And yes, this is a regular basis. . .

all4cake Posted 27 Aug 2010 , 5:22pm
post #6 of 21

It wouldn't be feasible for that company to require a deposit. They accept orders 24 hours in advance, and over the phone...there'd have to be some way for the transaction to take place (I, for one, would've protested a register at the bakery dept...could you imagine??? you'd be ringing up meat/deli/grocery/everything...people would be complaining big time if you didn't/couldn't)...nah, I would let them keep writing off those losses just like they write off the out of dates from the display cases...they're allowed so much in shrink/losses. when it gets above the allowed level, someone will pay a visit to find out the cause.

bringing it to someone's attention is a good thing though. if nothing else, it shows them that you are aware of losses. Fact is, that company(and they're not alone) doesn't want to hear about a problem unless you can also give them workable solutions to that problem.

KimmyKakes4Me Posted 27 Aug 2010 , 5:43pm
post #7 of 21
Quote:
Originally Posted by sweetonyouzz

You are all going to think I am nuts but I never do deposits. I take credit and debit cards and I accept checks if they pay 2 weeks before pickup but I never take deposits...the only exception to the rule is if they book a wedding for next year, I charge them 25 to 50 bucks to hold the date.

Please do not be harsh with me!!!,,,lol




That'll bite you in the butt someday.

jason_kraft Posted 27 Aug 2010 , 6:03pm
post #8 of 21

We only take deposits for wedding cake orders...all other orders are pay-on-pickup (cash or check only). Out of 500+ pay-on-pickup orders over the past couple years we've only had one person fail to pick up their cake.

jason_kraft Posted 27 Aug 2010 , 6:05pm
post #9 of 21
Quote:
Originally Posted by Rose_N_Crantz

BUT, I did a little experiment this week. I kept an eye on the orders that never got picked up. So far (and it's only thursday) we've had 2 full sheets, 1 half sheet and 3 10" round cakes left behind. Full sheets are $34.87, half sheets are $19.87 and 10" rounds are $12.34. That means a total of $126.36 we are losing.



What percentage of total weekly sales is that loss?

And are the cakes that aren't picked up just thrown out, or can they be refurbished to sell to a walk-in customer?

Rose_N_Crantz Posted 27 Aug 2010 , 9:52pm
post #10 of 21

The cakes are thrown out. I don't have access to the weekly sales unfortunately. I can ask, but I'm sure it's just gonna frustrate me further.

Perhaps I should just punch in, decorate some cakes with my head down, and punch out. This job frustrates me too much if I get too involved.

KimmyKakes4Me Posted 27 Aug 2010 , 9:59pm
post #11 of 21

I was under the impression that stores sold them at a loss to start, and they really don't care if they lose money on them at all.

luckylibra Posted 27 Aug 2010 , 10:08pm
post #12 of 21

You might just save the company hundreds of thousands of dollars and get a promotion if you were to say, keep track and provide those numbers along with a letter to upper management at corporate showing the money they are losing and then they can do the math on what that would equal mulitiplied by the number of stores they have. I am working on my MBA and this is absolutely something that could assist you in showing what an asset you are to the corporation! Best of luck and if you follow through I would love to know how it went.

Oh and Jason... that must be because yours are soooooo good and amazing. icon_smile.gif

Jess155 Posted 27 Aug 2010 , 10:12pm
post #13 of 21

Don't they donate them to a soup kitchen or food shelf? The full price - not just their cost - is a tax deduction.

icesk8ermom Posted 27 Aug 2010 , 10:31pm
post #14 of 21

$126.00 compared to what the daily sales of the "bakery" in general is nothing let alone the weekly sales! However if you look at that in the long run that is over $500.00 a month and $6000.00 a year. Again compared the annual sales of the bakery that is really nothing!

I can not imagine why on earth the cakes are not put out in the display case for sale or at least put on the discount rack for some sort of profit?? That is something I would look into and find out what the point of tossing them is?

However; as I was always told when I was in management when people would return stuff that I knew was a scam....It's not "your" money so don't worry about it! That is one thing that is VERY tough to do and can feel your frustration!

all4cake Posted 27 Aug 2010 , 11:34pm
post #15 of 21

our's would, if possible scrape the name off and repackage it for the case making sure that the date was adjusted so that it only got the allowed amount of time after prep. We didn't toss them unless fixing them would take too long.

The numbers of no shows got especially crazy during graduation! parents plan grad parties but grads have their own plans...

because of liability and logistic reasons, donating the cakes was not an option. They do more than their share of donating to various community programs including soup kitchens...procedures are to be followed for everything though.

all4cake Posted 27 Aug 2010 , 11:40pm
post #16 of 21
Quote:
Originally Posted by Rose_N_Crantz

The cakes are thrown out. I don't have access to the weekly sales unfortunately. I can ask, but I'm sure it's just gonna frustrate me further.

Perhaps I should just punch in, decorate some cakes with my head down, and punch out. This job frustrates me too much if I get too involved.




I think they'd be more welcoming to change if they were presented with a solution along with the problem. (I'd probably get pissed off if someone kept pointing out that my buttercream finish had flaws without sharing a possible fix to the problem...kwim?)

luckylibra Posted 28 Aug 2010 , 12:04am
post #17 of 21

all4cake is right.. maybe you can research the best way to resolve it.. can they take debit cards over the phone for orders.. things like that to secure a deposit amount at least. Then armed with the facts and figures.. you could estimate what the company wide losses are based on what your store shows as losses each week multiplied by the total number of stores and they could be amazed at what you have discovered. Suggesting ways to resell by redesigning them or marking down can be suggested too. I think it is great that you recognize something that is costing the company money and are willing to take steps to resolve it. It IS your money.. every person in a corporation is impacted by the profits as that determines what rate you can be paid and if bonuses, retirement and education reimbursement may be available.

carmijok Posted 28 Aug 2010 , 12:41am
post #18 of 21
Quote:
Originally Posted by Jess155

Don't they donate them to a soup kitchen or food shelf? The full price - not just their cost - is a tax deduction.




I worked at a very upscale home store one Christmas season and their policy (as are most retail establishments) is to destroy returns. We had 3 really expensive goose down pillows brought back in and they ripped them to shreds in the back. I was aghast saying I'd like to buy them...(discounted of course) but the policy was to destroy them. Letting employees buy the merchandise could create false returns. So I said, well can't we donate them to a shelter somewhere? I was told no because of potential lawsuits if there was a problem. And that's probably why they don't donate cakes. All it would take is someone to get sick and hire a lawyer and the company would have to pay big time.

Jess155 Posted 28 Aug 2010 , 1:41am
post #19 of 21
Quote:
Originally Posted by carmijok

Quote:
Originally Posted by Jess155

Don't they donate them to a soup kitchen or food shelf? The full price - not just their cost - is a tax deduction.



I worked at a very upscale home store one Christmas season and their policy (as are most retail establishments) is to destroy returns. We had 3 really expensive goose down pillows brought back in and they ripped them to shreds in the back. I was aghast saying I'd like to buy them...(discounted of course) but the policy was to destroy them. Letting employees buy the merchandise could create false returns. So I said, well can't we donate them to a shelter somewhere? I was told no because of potential lawsuits if there was a problem. And that's probably why they don't donate cakes. All it would take is someone to get sick and hire a lawyer and the company would have to pay big time.


I get that. In my town, one food shelf has a "Food Rescue" van that goes around to grocery stores and get their unsold bakery goods - breads, doughnuts, pies, etc. Grocery stores also donate these things to the soup kitchen. I've volunteered there, so I've personally served them.

I get that there's worry of lawsuits, but it is commercial food made in a commercial kitchen. Paying customers can get sick and sue too.

I can see destroying returned pillows, who knows what head lice or what not is on there? But cakes that have never been purchased, just sitting there untouched by customers is different.

sweetonyouzz Posted 31 Aug 2010 , 1:02am
post #20 of 21
Quote:
Quote:

That'll bite you in the butt someday




No, not really because my business is a low-key thing that I am doing after I have retired. My prices are pretty good for my experience and in the 35 years that I have been doing wedding cakes for folks (I live in a smaller community) I have never been burnt and if someone ever did it would not be the end of the world because I am more into this (at this stage of my life) for something to keep my mind an body active. It is really not all about the money for me and if someone did not pick up a cake...guess what?...I have a huge seniors home across the street who probably would love a cake!

I certainly understand decorators taking deposits though when it is your bread and buttericon_smile.gif

Baker_Rose Posted 3 Sep 2010 , 1:31pm
post #21 of 21

Also, you can't take a deposit when the customer is paying with food stamps (or how ever they do it these days). MANY years ago, when I was a check-out girl I was amazed at how many weddings were put together entirely from the grocery store and paid with food stamps. I now work part time in another grocery store bakery and am asked all the time if the cakes are payable with food stamps.

Quote by @%username% on %date%

%body%