Did I Undercharge On This Cake?

Business By MandyCakez Updated 16 Nov 2010 , 7:46pm by Annabakescakes

MandyCakez Posted 15 Nov 2010 , 7:37pm
post #1 of 18

I made the Monkey cake in my pics for a 1st Birthday and charged her $80.It took me three stressful days to make all the monkeys and bananas.I'm sure if i didn't have twins an a special needs child it may have been less time!lol But it's a 10 inch bottom with a 6 inch top.Butter cream filling with MMF.I'm a newly legal business in PA if that helps.What would you have charged for this if you don't mind me asking?

17 replies
leily Posted 15 Nov 2010 , 7:52pm
post #2 of 18

location plays a big part in what you can charge. I'm in iowa and in my area (more rural) i would have charged $132 for the cake and then at least $20-30 for the monkey work (i pay someone else to do this as i'm not good at modeling) However if I were about 80-100 miles one way i could charge almost double that due to location, but my supplies would also cost more since cost of living is higher, so i wouldn't necessarily make more money, i would just have to charge more to still make the same profit and same hourly rate.

The 10" serves 39 and the 6" serves 14 (industry standard slices of 1x2x4) so at the $80 your price per serving was $1.50.

-Do you know what your actual cost were for the cake?
-Did you keep track of your hours you worked? You said 3 days, but was the a full 8 hrs per day? If yes then without figuring in any material cost into the $80 you would have only made $3.33/hr, so probably well under $2/hr after subtracting the actual cost you spent on the cake.

icer101 Posted 15 Nov 2010 , 8:15pm
post #3 of 18

Hi, in the first place, your cake is gorgeous. Lots of work. I live in nc. and i would have charged $150.00-$175-00 for that same cake. i would have no problem. you did a super job on it. hth

ladyonzlake Posted 15 Nov 2010 , 8:17pm
post #4 of 18

My cakes start at $4.00 per serving ($150.00 minimimum order) and for this particular cake I would have charged $5.50 per serving due to the amount of sculpting involved. A 10" and 6" for me serves 47 so that would be $258.50.

Good luck on your new business!

brincess_b Posted 15 Nov 2010 , 8:18pm
post #5 of 18

i think if you have to ask the answer is no! there is an argument cakers never get paid their worth, but that aside, if you are really questioning your price, you are probably right to.
xx

leah_s Posted 15 Nov 2010 , 8:50pm
post #6 of 18

My fondant price for 53 servings would be $212
Plus another $50 or so for the monkeys, plus equipment plus delivery. Total around $300 - $310.

MandyCakez Posted 16 Nov 2010 , 5:51am
post #7 of 18

Thanks for the help ladies!I really do feel like i undercharge but i guess it's because i'm so new to the business.I REALLY need to start to value my work.I've read so many helpful posts within the past few days on here that have really made me realize that.I basically work from the time my husband gets home until i can't stay awake anymore.

I just get so frustrated by the nerve of some people.This cake was to be a 3 tier originally but then she changed it to a 2 tier after the price quote.Then i had a client cancel on me lastnight (which i had a gut she was going to)on an order this weekend for a Xbox shaped cake with controller and game on top for $70.She made a remark about the price so i had a feeling she wasn't going to go through with it.Then i have a lady i'm doing a Birthday cake for (she picked the most cheapest quote i gave her) decide she didn't want the cupcakes with the tower,MIL was going to make the cupcakes.But then messaged me a few days later asking me to borrow my cupcake towers? icon_confused.gif So i'm just doing a 6 inch topper for her.Then i had a guy that wanted a dozen of my cookie dough cupcakes.I consider that a specialty flavor so i charge $2.75 a cupcake with a minimum dozen per order so i told him $27 for one dozen.He replied back saying."Wow,I wasn't expecting that.I'll let you know!" icon_rolleyes.gif And i won't even get started on the nerve of a friend of mine!!LOL

People need to realize i'm a business and not a charity!! icon_eek.gif

mombabytiger Posted 16 Nov 2010 , 10:39am
post #8 of 18

I don't know where you all live that you can command $80-$300 for a child's birthday cake. I don't care if it took me 8 weeks and was made out of gold, no one around here would pay that! The most I've ever been able to get was $50. Maybe I need to move...

Emmar308 Posted 16 Nov 2010 , 12:01pm
post #9 of 18

"I don't know where you all live that you can command $80-$300 for a child's birthday cake. I don't care if it took me 8 weeks and was made out of gold, no one around here would pay that! The most I've ever been able to get was $50. Maybe I need to move...."

My thoughts exactly!!! I'm always astounded by the prices you US bakers are able to charge for your cakes. Unless it's a wedding cake (or you're in London!) i really don't believe anyone would be prepared to pay those sort of prices for birthday cakes here! Don't get me wrong, i firmly believe these cakes are worth it - knowing how much work goes into a cake - but (and any UK bakers, please feel free to correct me if i'm wrong!) anything over £50 for a childs birthday cake is unlikely to get you much work.

diamondsonblackvelvet13 Posted 16 Nov 2010 , 12:13pm
post #10 of 18
Quote:
Originally Posted by MandyCakez

People need to realize i'm a business and not a charity!! icon_eek.gif




Exactly. Stick to your guns. The customers will come around. It took the folks around here a while to used to my prices and now I am booking 2 months in advance. thumbs_up.gif

leah_s Posted 16 Nov 2010 , 1:24pm
post #11 of 18

What you have to understand is that while you sell 6, $50 birthday cakes, I sell 1, $300 birthday cake. We make the same $, but I work less. THAT'S the secret. While you need 6 customers, I only need 1. And then I'm "special" and "exclusive" and **desired**.

countrychick1975 Posted 16 Nov 2010 , 1:56pm
post #12 of 18

Very nice work! I also live in PA (an hour NW of Phila.) and I'm a "newbie" business. I was always underpricing my cakes and my husband kept telling me my cakes were "worth more". I just thought he was being bias. But after I started receiving orders and giving price quotes and estimates... I haven't receive a single turn-down! And I was thinking I was overpricing.
If you think of it this way... brides are usually willing to pay a minimum of $200 for a basic, smaller size wedding cake. Well, you put at least the same amount of time (possibly more) into your specialty cakes. Why shouldn't you be able to receive the same compensation for your quality work and effort?
Like the others have said, stick to your guns and be firm! The happy customers who you do have will become repeat customers and spread the word about your wonderful cakes!
Best of luck! icon_smile.gif

LindaF144a Posted 16 Nov 2010 , 2:26pm
post #13 of 18

I love LeahS' answers.

Where we live the monkeys are charged $30 per monkey. If they want it bad enough they will pay the price.

I have said this before and it bears repeating - your job is not fit the price to the job, it is to fit the job to the price. If they are willing to pay no more than $80 for a cake, then you tell them what that $80 will get them. They do not tell you what they want for that price. It is your business and your life. That does mean sometimes (actually most of the time) the customer does not get the cake they want and you do not get to make the cake of your desire. But three days and $80, well you do the math. You worked for pennies.

The good news is you have a great cake for your portfolio. But you had better quote the correct price for the next cake, unless you want to work for pennies.

Oh and wait til you get to filing the taxes on that slim profit after ingredients, energy costs, insurance, etc. You will have worked for less then.

I work at a cakery. When I think about it, almost every new customer gets a different cake then they envisioned, one that will fit in their price range rather than what we charge for the cake they envisioned. One new customer want two pregnant 3d fondant standing woman bumping bellies. That will be $60 extra. Ummmmm..... Never mind. Can you make a flat silouhette on the top of the cake? Yes, that will be $10. I have yet to have a customer pay for their more expensive idea. The remaining existing customers know what they can get in their price range and seem happy with the results. I can tell because they keep coming back for more of the same.

Do not undersell yourself. In the ling run, like Leah said, it is not worth it to work 6 times as hard to make the same amount of money. If I made pennies making cakes, I would have to face the hard realization that I am in the wrong business. I still do working in a cakery. Less business means less hours means less paycheck. Luckily for me, it has been steady. icon_biggrin.gif

And I charge $30 for my cupcakes. I came up with that price for a dozen minimum because I didn't really want to make them. But after a summer of giving them away for free while testing recipes to my DDs coworkers, they are now hooked and want them even if they do have to pay more. And yes, I do have an approved kitchen in my home. So now it makes it worth my while to work all night after working all day.

BluntlySpeakingKarma Posted 16 Nov 2010 , 2:39pm
post #14 of 18
Quote:
Originally Posted by leah_s

What you have to understand is that while you sell 6, $50 birthday cakes, I sell 1, $300 birthday cake. We make the same $, but I work less. THAT'S the secret. While you need 6 customers, I only need 1. And then I'm "special" and "exclusive" and **desired**.




Really awesome. Best answer that will ever be given to this subject.

ladyonzlake Posted 16 Nov 2010 , 2:55pm
post #15 of 18

I was in your position too when I started. I was so desperate for cake orders so I undercharged until I realized I wasn't making anything at it.

I then established myself as a "custom" bake shop and very clearly put on my website my minimum order of $150.00 and starting price of $4.00 per serving to "weed" out those customers that were seeking out "grocery store" type cakes and prices. It worked.

I use to price celebration cakes less than wedding cakes but now every cake is priced the same. I am now booked anywhere from 4 weeks to 1 year out.

littlecake Posted 16 Nov 2010 , 6:05pm
post #16 of 18

i don't get enough 300.00 cakes to pay my overhead......so i have to do small cakes, i'd go broke with just having big cake orders....i wish i could....hats off to ya'll who can!

jason_kraft Posted 16 Nov 2010 , 6:14pm
post #17 of 18
Quote:
Originally Posted by leah_s

What you have to understand is that while you sell 6, $50 birthday cakes, I sell 1, $300 birthday cake. We make the same $, but I work less.



Actually, if you price correctly (taking into account variable costs including ingredients and labor) you will both make the same $ and do the same amount of work. If making a $50 birthday cake takes more than 1/6th the resources of a $300 birthday cake, then the $50 birthday cake is priced too low.

Quote:
Quote:

While you need 6 customers, I only need 1. And then I'm "special" and "exclusive" and **desired**.



I view more customers as a positive...more customers means more good word of mouth and more free advertising. Yes, there is more overhead when you deal with more customers, but that's why per-serving prices are higher for smaller cakes. You also get to spread out your fixed costs over a larger number of orders.

And it's certainly possible to be "special", "exclusive", and "desired" serving a more downmarket niche -- the only difference is that it takes more customers to reach capacity, but the increased word of mouth should take care of that for you. Businesses serving this niche are also more resistant to economic recessions as people cut back on spending.

Annabakescakes Posted 16 Nov 2010 , 7:46pm
post #18 of 18

I notice that a lot of people that have very strong comments on how much a cake should cost and how much is too much, really don't offer a very nice looking product, not even a step up from a grocery store that has people off the street with 2 hours of "training". So they are round, big deal! I'd rather have a well done grocery store cake at my party than an ugly, crumby, lopsided, jankety-iced "custom" cake from somebodies little bakery. Not just this thread, but in COUNTLESS others. But A lot of people aren't comparing apples with apples, they are comparing a BMW, and a Yugo that is been rolled down a hill, and saying the BMW is way to expensive compared to the Yugo.

I realize I don't have a lot of cakes on here, I don't have a digital camera anymore, I just use my phone and send them to my facebook, so it is more trouble for me to save them to my computer and then upload them here. It is just not worth it to me.

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