Help With Pricing Please!

Decorating By gfbakergirl88 Updated 14 Oct 2010 , 1:43am by Foxicakes

gfbakergirl88 Posted 12 Oct 2010 , 8:04pm
post #1 of 17

I just did my first wedding cake and I am not sure if I overcharged or undercharged...I charged the client $230 for a 14", 10", 6" round, all white cake with IMBC filling and BC iced. Since there wasn't any time to make sugar flowers, I used silk magnolias at the request of the client.

I figured the price at $2.00 per slice (116) according to Wiltons cake chart.

It took me about 16 hrs to do everything.

She came to me a week before the wedding and said her original decorator flaked out on her. Of course I felt bad and offered to make the cake for her despite my busy schedule.

So is $230 too much or too little? What do you think?

16 replies
TexasSugar Posted 12 Oct 2010 , 8:14pm
post #2 of 17

The best thing you can do is figure out how much you spent on supplies and how much your time is worth.

If you figure your time was worth 10 an hour, then $160 of what you made goes to that. That only leaves $70 to cover your supplies and any profit.

CWR41 Posted 12 Oct 2010 , 8:29pm
post #3 of 17
Quote:
Originally Posted by cgcowgirl2008

I figured the price at $2.00 per slice (116) according to Wiltons cake chart.




I think you undercharged, but it sounds like you were happy with that. Are you making the kind of money you want at $2.00 per slice? (I think most would charge $3.00 - $3.50 per serving for that without the flowers or extras.) Wilton's wedding chart = 128 servings, so you threw in the 6" for free.

She got a sweet deal that probably would have cost her $384 - $468 elsewhere, IMO.

gfbakergirl88 Posted 12 Oct 2010 , 8:37pm
post #4 of 17

Im new to the business and not sure what kind of profit to expect to make.

leily Posted 12 Oct 2010 , 8:45pm
post #5 of 17
Quote:
Originally Posted by cgcowgirl2008

Im new to the business and not sure what kind of profit to expect to make.




You have to determine how much profit you want to make. And that is only profit AFTER all the bills have been paid. Any overheads you have, insurance, taxes, payroll, ingredients, supplies, utilities etc...

jason_kraft Posted 12 Oct 2010 , 9:37pm
post #6 of 17

If you are baking from home, have you made sure it is OK to sell baked goods from home in Indiana? IIRC I believe it's only legal for home-based businesses to sell at roadside stands and farmer's markets.

EDIT: Sounds like you're probably OK, so if you're baking from home the only overhead costs you would need to take into account would be liability insurance (and if you don't have liability insurance I strongly recommend getting some, it typically costs less than $500/year). Divide your annual insurance costs (and any other overhead) by the estimated number of cakes you'll make per year for an estimate of the overhead cost per cake.

kelleym Posted 12 Oct 2010 , 9:58pm
post #7 of 17

It appears that many HD's in Indiana are applying a very liberal interpretation to the new law, allowing direct-to-consumer sales. I even read that one CC'er's HD Rep told her that her house counted as a "roadside stand". icon_lol.gif

Bskinne Posted 12 Oct 2010 , 10:09pm
post #8 of 17
Quote:
Originally Posted by jasonkraft

Have you made sure it is OK to sell baked goods from home in Indiana? IIRC I believe it's only legal for home-based businesses to sell at roadside stands and farmer's markets.



Love the biz forum, automatically assuming she's baking out of her house illegally. Maybe she's renting a kitchen, or just opened a shop. She didn't say. Just saying.

ElsaLee Posted 12 Oct 2010 , 10:43pm
post #9 of 17
Quote:
Originally Posted by jasonkraft

Have you made sure it is OK to sell baked goods from home in Indiana? IIRC I believe it's only legal for home-based businesses to sell at roadside stands and farmer's markets.




Hi,
I found this site a few months ago searching for my best friends wedding cake. I have been hooked ever since. I only look at pictures and read all the interesting posts. I wish to one day be able to bake and decorate at least half as nice as all the bakers on here. I was always thinking of joining the forums and then thought what for? I don't know anything to help out people and I only bake cupcakes and cookies for my kids.

Today I have finally joined the forum. I joined thanks to the reply "jasonkraft" posted. In the past months I have enjoyed reading thru all the stories, ideas and cries for help. Every once in a while I come across a reply like the one quoted above. I ask myself why? I understand the whole "I have a licensed business and it's not fair that I have to be legal and you don't" bit. (I truly understand)

Seriously, that is not the question that was asked here. There was not even an attempt to reply with a helpful answer. I'm sorry... It just bothers me that so many posts are ruined with the same thing. Is it so hard to just skip the post and not reply? Like I said before, I understand that there are other issues involved. I just hate to see when this kind of reply is posted and it has nothing to do with the question in hand. Sorry...I just had to vent.

jason_kraft Posted 12 Oct 2010 , 11:41pm
post #10 of 17
Quote:
Originally Posted by Bskinne

Quote:
Originally Posted by jasonkraft

Have you made sure it is OK to sell baked goods from home in Indiana? IIRC I believe it's only legal for home-based businesses to sell at roadside stands and farmer's markets.


Love the biz forum, automatically assuming she's baking out of her house illegally. Maybe she's renting a kitchen, or just opened a shop. She didn't say. Just saying.



If you reread my post, you will notice that I was simply asking if OP had checked if it was legal to bake from home. Like it or not, this question is integral to any discussion of pricing, since if commercial home baking is not legal then extra overhead costs must be factored in.

Bskinne Posted 12 Oct 2010 , 11:50pm
post #11 of 17
Quote:
Originally Posted by jasonkraft

Quote:
Originally Posted by Bskinne

Quote:
Originally Posted by jasonkraft

Have you made sure it is OK to sell baked goods from home in Indiana? IIRC I believe it's only legal for home-based businesses to sell at roadside stands and farmer's markets.


Love the biz forum, automatically assuming she's baking out of her house illegally. Maybe she's renting a kitchen, or just opened a shop. She didn't say. Just saying.


If you reread my post, you will notice that I was simply asking if OP had checked if it was legal to bake from home. Like it or not, this question is integral to any discussion of pricing, since if commercial home baking is not legal then extra overhead costs must be factored in.



And like I said, she never said she WAS baking from home, you just assumed, please read before you post. This is just the only thing you ever offer to discussions.

jason_kraft Posted 12 Oct 2010 , 11:57pm
post #12 of 17

In pricing a cake, you need to look at three things: ingredients, labor, and overhead. My question went directly to the third component of pricing, which had not yet been discussed in this thread.

I probably should have prefaced my original question with "If you are baking from home", so that point is taken. I have gone ahead and made that edit.

However, I will continue to bring up overhead costs in discussions regarding cake pricing, and I make no apologies for discussing legal issues related to the business of cake decorating in the Cake Decorating Business forum. If you want to continue to bash me for doing so, please send me a private message so we can avoid taking this thread any farther off-topic.

This forum is not just for people who already have a legal business, it is also a great place for people who are just getting started to learn about the business side of things. Part of running a successful cake business is operating within the laws of your state/county/city, and when you price your products you need to take legal compliance costs (if any) into account. Some people who are just starting out have no idea what their local laws are (or even that local food safety laws exist), and it's important that they are aware of all aspects of their operating environment.

Bskinne Posted 13 Oct 2010 , 12:04am
post #13 of 17

I'm not bashing you, just stating an obvious fact. I would love to do you a favor and petition the mods to change the forum name to "For legal bakers only" so we could free up a little time for you.

Stephy42088 Posted 13 Oct 2010 , 12:14am
post #14 of 17

I agree! the question at hand had nothing to do with legalities so it shouldn't have been brought up, it was an out of place reply and i'm only offering my 2 cents because i'm sick and tired of so many people arguing and judging on the matter of legalities. it's not your business (literally) so it shouldnt be of concern to you.

Kaylani Posted 13 Oct 2010 , 12:23am
post #15 of 17

Ok, so I am going to ignore most of what has been talked about & answer the OP's question. icon_rolleyes.gif

$2 is really low, but I think it really depends on where you are located. There seems to be a really big difference in areas.

There is a caker in MI who charges less than Walmart & would put my whole town out of business in a week. She swears that is what everyone charges & that she has done the research, so there is no comparing prices with her because they are about 1/3 of what a cake is in my area.

Working out of your home definitely lowers your overhead, but it is also easier to ignore actual overhead costs because you pay those bills anyway.

Electricity, water, etc....Just a thought I have had reading alot of posts. An extra $20 or $30 + a month in cost might not be noticed in a household budget.

When you pay for a retail space you have to include those costs in your business plan & they are impossible to ignore.

Another big difference in costs can be how do your structure. Do you use SPS?

If you were in my area I would hope you would charge at least $2.50 per serving for a basic cake like the one you described.

I think the kindest thing cakers can do for each other is check out your town competitors pricing & stay in the range. It takes a bit to do the research, but if you find out what everyone in your area charges that would help you too.

Guess this is always a hot button topic for the forums. Keep asking & don't be discouraged by some negativity. thumbs_up.gif

gfbakergirl88 Posted 14 Oct 2010 , 12:10am
post #16 of 17

Thank you Kaylani. You were very helpful!

What is SPS?

Foxicakes Posted 14 Oct 2010 , 1:43am
post #17 of 17

Wow! ! Is it just me or did this one go WAYY off topic!! Geesh, guys! These forums are to HELP each other. I really think if you need to have an argument or verbally beat each other up, you may want to do it privately.

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