Help Me! Need Opinions On Price To Charge...

Baking By lisamaria Updated 29 Sep 2010 , 8:45am by EvMarie

lisamaria Posted 19 Sep 2010 , 5:19pm
post #1 of 18

Hey all. I wasn't sure where to post this, so I hope this is the right category. I usually only bake for pleasure, but someone tasted some cookies I made and she asked if she could order three dozen for a party. Anyone know what I should charge for 3 dozen chocolate chip cookies??? I have no idea and I want to be fair!

17 replies
cattycornercakes Posted 19 Sep 2010 , 5:31pm
post #2 of 18

You need to calculate how much all of the ingredients are going to cost you, approximately how long you think it will take to make the cookies and how much you'd like to be compensated for the time.

lisamaria Posted 19 Sep 2010 , 5:47pm
post #3 of 18

Ok...thanks...I always have certain items in, so I wouldn't need much. I just want to be fair and not overcharge. I was thinking it would be somewhere between $15 and $20.

hollyberry91 Posted 19 Sep 2010 , 6:03pm
post #4 of 18

I think even if you still have the ingredient in your house you should still charge for it if you use it because it did cost you. Personally I think $10 to $20 per dozen would be fair depending on the size of the cookies. icon_biggrin.gif

lisamaria Posted 19 Sep 2010 , 6:31pm
post #5 of 18

Yes, that is true. I am still using it. This is so tricky cos you never know if the person is gonna think you are charging too much. And this woman is my sister's friend, so it's hard. I would say these are regular size cookies..about 2-3 inches in diameter.

myslady Posted 19 Sep 2010 , 6:53pm
post #6 of 18

Just because you already have an ingredient on hand, doesn't mean that part of that cost shouldn't be apart of your final price.

Is your price per dozen or for all 3 dozen.

lisamaria Posted 19 Sep 2010 , 8:13pm
post #7 of 18

My initial thought was $20 for 3 dozen, but I am not sure..that's why I wanted opinions. Yes, I agree that ALL ingredients used should be taken into consideration. I am new at this. I only sold 1 cake and 3 cheesecakes in my life. lol I know this woman doesn't have a lot of money and I feel like I shouldn't charge as much as a bakery, or they may as well go there.

kansaslaura Posted 20 Sep 2010 , 12:18am
post #8 of 18

A rule of thumb that was explained to me years ago for charging for things like cookies (not the labor intensive decorated sugar cookie, but a drop cookie like you're making) is.

Triple your cost.

1/3 goes to ingredients

1/3 goes to overhead (electricity, water, boxes, bags--etc.)

1/3 is profit.

I have been charging $5.00 per dozen for several years and make a fair profit doing so.

It doesn't take long to knock out of batch of chocolate chip, peanut butter or snickerdoodle cookies so I sell them at a very reasonable, but much higher than grocery store bakery prices.

lisamaria Posted 20 Sep 2010 , 11:48am
post #9 of 18

Thank you so much! Guess what? You are the 2nd person who told me about the 1/3 rule. I appreciate it. icon_smile.gif I agree that these cookies are not labor intensive....so I guess I was on target with my price range.

indydebi Posted 20 Sep 2010 , 12:27pm
post #10 of 18

bear in mind that "cost" is much more than just the ingredients. your "cost" includes overhead, payroll (what you pay YOU), etc.

Many make the mistake of adding up just the ingredients and using that as "cost". Doing that on the "times 3" method would have thrown me into bankruptcy a long time ago.

i.e. My cost for making a batch of snickerdoodles was $0.94/dozen. On the "times 3" theory, I'd sell these for less than $3/dozen. However, it took my kitchen employee an hour to mix, bake, clean up and package the cookies, and I paid her $10/hour. I'm in the hole at least $7.

Your final selling price, when divided by 3, theoretically should cover your costs as broken out by kansaslaura. however, your "ingredients" times 3 is not how you determine your selling price.

kansaslaura Posted 20 Sep 2010 , 1:38pm
post #11 of 18
Quote:
Originally Posted by indydebi


i.e. My cost for making a batch of snickerdoodles was $0.94/dozen. On the "times 3" theory, I'd sell these for less than $3/dozen. However, it took my kitchen employee an hour to mix, bake, clean up and package the cookies, and I paid her $10/hour. I'm in the hole at least $7.

Your final selling price, when divided by 3, theoretically should cover your costs as broken out by kansaslaura. however, your "ingredients" times 3 is not how you determine your selling price.




But, Debi--your example is only for one dozen in that hour. I could crank out around 30 dozen (mixed to baked) in one hour. And at least 1/3 of them were packaged by the time the hour was over.

The second 1/3 in my example goes to cover the overhead (labor, etc). It's not perfect--it certainly doesn't cover the labor for decorated cookies or cakes (and I don't apply it in those cases)--but it's a good rule of thumb that has served me well.

There are times I make a lot more (bread for example) than 1/3 on what I sell.

indydebi Posted 20 Sep 2010 , 3:48pm
post #12 of 18

laura .... good point. But i also figured to the highest common denominator. If I had an order for one dozen cookies, it takes the same overhead to bake one dozen as it does to bake 10 dozen. So my pricing is based on "if I only baked one dozen ....."

same logic as we use on buying supplies. "Sometimes" I can get strawberries for $18/flat. But my selling price is based on worst case scenario of having to pay $36 to $42/flat (off season; bad crop yields; unforeseen floods or crop failures that drive the price up).

I've seen articles that advocate the "times 3" formula .... for ingredients. PLUS add your overhead PLUS add your labor.

ingredients times 3? nope. that means I'd be selling wedding cake for barely more than a dollar per serving. And I dont' want you all to yell at me for that! icon_redface.gificon_lol.gif

GeminiRJ Posted 20 Sep 2010 , 5:59pm
post #13 of 18

How much would she have to pay if she bought them from a cookie shop? My family was just on vacation, and I plunked down $8 for 6 chocolate chip cookies (about 3.5") while we out shopping one day. That would come to $16 for a dozen, or $1.33 each. I don't think that's unreasonable at all! Do a little bit of research on what cookies go for in your area, and adjust your prices as you deem necessary to make it worth your while.

lisamaria Posted 22 Sep 2010 , 2:53am
post #14 of 18

I'm confused now! lol I don't really understand the 1/3 rule.

It's so hard to come up with a fair price. Then on top of the cookies, she asked me to make a birthday cake for the same day. You all give great advice. I have checked bakeries, but grocery stores tend to sell things for so cheap. I just don't think they compare to homemade fresh cookies.

Thank you everyone for your help!

cakeandpartygirl Posted 22 Sep 2010 , 3:14am
post #15 of 18

I think indydebi is saying, if your cookies cost you 3 dollars to make it then 3X3 is 9 plus if you want to get paid 10 per hr and you make the cookies in 2 hrs your labor time would be 20 plus what ever overhead you have
so without overhead you would charge 29 for 3 dz cookies at a minimum.

indydebi Posted 22 Sep 2010 , 3:46am
post #16 of 18
Quote:
Originally Posted by lisamaria

I'm confused now! lol I don't really understand the 1/3 rule.


icon_lol.gificon_lol.gif that's why everyone hates the pricing issue!

basically .... "ingredients times 3" will get you bankrupt.

See my post on this thread with add'l info (2nd post from the bottom): http://cakecentral.com/cake-decorating-ftopict-688450-sams.html

lisamaria Posted 23 Sep 2010 , 12:19am
post #17 of 18

Thanks for clarifying! I have a good idea now. thumbs_up.gif

EvMarie Posted 29 Sep 2010 , 8:45am
post #18 of 18

Don't forget that this lady probably won't be able to get cookies that taste like YOURS in a bakery. I'm sure you have a nice bakery some where in town...but she still asked YOU.

I make a ton of specialty (non cut out) cookies. Mini tars, rolled cookies, shaped cookies, dropped cookies....etc.....I used to price at $5 a dozen for a regular sized cookie. But, now I'm at $6 a dozen. And...for what I do...it's probably a buck too low. Yes, you can crank out in volume drop cookies. But....are you using high quality chocolate? Nuts? And, how are you getting them to her? Cello wrapped and gift boxed? Or, just a regular box? A bakery box at a box store or purchasing a box at a grocery store bakery will cost you a couple dollars in box, tax, and gas.

It's not THAT big a deal...just don't end up ripping yourself off. You should feel happy about making them for her. Do you have an Original Cookie store? I think it's Mrs. Fields now. They sell regular sized choc chip I think. Call them up and see how they price.

No worries....have fun...but don't underprice so you feel bad about the experience.

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