What Kind Of Deals Should I Offer?

Business By pj22 Updated 22 Sep 2011 , 11:30pm by pj22

pj22 Posted 22 Sep 2011 , 9:34pm
post #1 of 24

I got an offer from a children's gym in the area who said that they are looking for a cake vendor to advertise to parents who conduct birthdays at the gym. They have 8-9 parties each weekend and parents have the option to book from the gym's vendor.

In return for the preferred ad, I will have to offer some deal along with free delivery. I don't mind the free delivery since it is close to where I live. But I am not sure what discount to offer.

The previous vendor was an ice cream store who made only pricey ice cream cakes and gave a 15% discount.

I am considering offering a 15% discount as well. My rates are $2/serving for buttercream cakes, $2.50/serving for buttercream plus fondant accents and $3 per serving for fondant covered cakes. My regular cupcakes are $2 each and mini cupcakes are $1.25.

Does a 15% discount sound good? Or do you have any other ideas? Anyone who has done something similar and has any advice? TIA!!

23 replies
mariacakestoo Posted 22 Sep 2011 , 9:39pm
post #2 of 24

Sounds awful. I wouldn't want to be locked in to doing discounted cakes every weekend, and miss out on customers who wouldn't be getting a discount. Can you say burnout?

mariacakestoo Posted 22 Sep 2011 , 9:40pm
post #3 of 24

But that's just me, so don't take that personally. I'm sure doing that sort of thing works well for people.

leah_s Posted 22 Sep 2011 , 9:46pm
post #4 of 24

Your prices are too low to offer ANY discount. I'd offer something like 15 cupcakes for the price of 12.

And then raise your prices.

CakeMom5001 Posted 22 Sep 2011 , 9:46pm
post #5 of 24

Could you offer custom cakes along with a discount plain jane cake. You could always bake and freeze cakes and whip out the plain jake cakes and make a profit of some sort. Those parents who wish to have a custom cake - pay full price and get free delivery.

Not sure if that is helpful - but you could also get addtional business if the parents attending the party like and enjoy the cake.

aligotmatt Posted 22 Sep 2011 , 9:48pm
post #6 of 24

I wouldn't offer a deal like that. I would come up with a few designs for boy/girl/unisex with a set size - whatever they typically have at a party 15 or so I would assume. And then give it a price. Say, You can get this tasty cake for just $30 delivered and setup to your party! woohoo!

pj22 Posted 22 Sep 2011 , 9:56pm
post #7 of 24

Thanks for the responses!

mariacakestoo: I'm starting out so I thought this would be good exposure and I don't know if I will be locked in each weekend since it is up to the customers if they want to order with me... anywho.. I lovee making cakes!! lol


leah_s: These are the rates in the area here but I was thinking of raising my prices after getting a foot in the door? The 15 cupcakes for the price of 12 is for the cupcakes but what about sheet cakes and round cakes?

CakeMom5001: I don't think I understand what you mean! So you are saying give a discount on plain cakes and offer custom cakes for the same party as well? I don't know if customers would like to order 2 cakes for the same party, regardless of how small or big they are?

aligotmatt: That sounds like a good idea but won't it restrict customers into choosing from a limited range? Something like the grocery store? Then how about cupcakes, cake pops etc?

Or do you guys think I should raise my prices and then offer the discount? Aaarghh.. so confusingggg :/

TexasSugar Posted 22 Sep 2011 , 9:59pm
post #8 of 24

What about offering a discount on a plain jane generic cake with the option of a custom made for regular price?

Honestly though, I'd really do the math on the time you will have invested and how much it will be worth it in the long run. Personally I'd rather pay them a flat fee for the preferred ad, then have to offer an running discount.

A 13x9 for 24 servings is $48. With a 15% discount that makes the cake $40.80, with a $7.20 discount.

If you did 5 of those a weekend you will be losing out on $36. If you did 8 of them that's $57.60.

So not only are you committing to cheaper cakes, you are also taking your time away from other cakes that would pay you more.

I do agree with others about raising your prices in general though.

pj22 Posted 22 Sep 2011 , 10:05pm
post #9 of 24

So customers can choose a generic cake at the 15% discount but if they want it custom made, they will pay the full price and get the free delivery? I'll keep that in mind but I'll have to come up with some generic cake ideas and I'm so new to the business, I don't know where to look icon_confused.gif

Or should I offer, say, 6 cupcakes free with a 13x9 cake? No %off discount? Any other ideas?

mariacakestoo Posted 22 Sep 2011 , 10:07pm
post #10 of 24

I say you just offer your services, and call it a day! Don't get people stuck in discount mode, and think you need to be cheap because you're just starting out. True, you aren't going to be able to demand big dollars, but don't rip yourself off in the meantime. Seriously!

pj22 Posted 22 Sep 2011 , 10:09pm
post #11 of 24

Well, the place says that I would need to offer some kind of deal to get free ads in their letters and I thought it would be a good way to start...

TexasSugar Posted 22 Sep 2011 , 10:11pm
post #12 of 24
Quote:
Originally Posted by pj22


aligotmatt: That sounds like a good idea but won't it restrict customers into choosing from a limited range? Something like the grocery store? Then how about cupcakes, cake pops etc?




Have you ever been to a Chuck E Cheese birthday party? I'm pretty sure there you only get a choice of vanilla or chocolate and the kids name written on it.

Plus there is so much going on at one of those parties that kids don't really slow down to eat cake, so if I was a parent I wouldn't be looking for a huge, expensive custom cake for that.

I would do a custom cake if I was having a personal party at home, where I didn't have to be in and out of the door in under two hours.

Some other things I would consider is how long in advance will you know if you have orders for the weekends. If you don't know far enough in advance you are going to end up either having to pass on orders from other people or maybe end up with too many cakes in one weekend.

And what if all 8 parties decided to order cakes from you, can you handle doing 8 of them at a time?

mariacakestoo Posted 22 Sep 2011 , 10:14pm
post #13 of 24
Quote:
Originally Posted by pj22

Well, the place says that I would need to offer some kind of deal to get free ads in their letters and I thought it would be a good way to start...


Oh, yeah, sorry missed that. I don't get into things like that.

mplaidgirl2 Posted 22 Sep 2011 , 10:17pm
post #14 of 24
Quote:
Originally Posted by pj22

So customers can choose a generic cake at the 15% discount but if they want it custom made, they will pay the full price and get the free delivery? I'll keep that in mind but I'll have to come up with some generic cake ideas and I'm so new to the business, I don't know where to look icon_confused.gif

Or should I offer, say, 6 cupcakes free with a 13x9 cake? No %off discount? Any other ideas?




I think they free cupcakes makes more sense... Just make sure you say SAME FLAVOR SAME FROSTING! Cause then you'll get people looking for crazy things... I usually throw in a few free cupcakes with all my orders. I never tell them that. I just use whatever batter I have leftover. If I have no leftover they don't get them... But as a promo I think something like that works out better

pj22 Posted 22 Sep 2011 , 10:18pm
post #15 of 24

You raised some very good points TexasSugar!! The Chuck E Cheese example is a good one... maybe I can offer 2 or 3 flavors but I am confused about what kind of standard generic decorations to go with? Any help on that? I can present my offer when I go to meet them tomorrow.

You are right about the attention that a cake would get at a venue like this where kids are more prone to playing and running around.

Or... how about ordering Decopac kits and having customers order from that? I have a Tax ID and everything so I can set up a Decopac account and just follow those decorations. Those who really want something unique can choose from custom designs. And I know the previous ice cream cakes vendor did that too and these kits seem to be popular with parents and kids, specially who have parties outside the house.

I sure cannot handle all 8 at a time so I would have to decline!! I am going to find out about how far in advance they let me know the orders. The gym wont have anything to do with it I think...it's the parents who will contact me directly. Thanks so much.. looking forward to suggestions icon_smile.gif

pj22 Posted 22 Sep 2011 , 10:19pm
post #16 of 24

Yes mplaidgirl2... same flavor and frosting

TexasSugar Posted 22 Sep 2011 , 10:20pm
post #17 of 24
Quote:
Originally Posted by pj22

Well, the place says that I would need to offer some kind of deal to get free ads in their letters and I thought it would be a good way to start...




I would talk to them about what other things you can do to get in their letters. There maybe something else that would be a better fit.

Also how many of these people are going to want a cake from you for another event? If they do, are they going to expect the same prices they got at the party place? How are you going to handle that situation?

TexasSugar Posted 22 Sep 2011 , 10:23pm
post #18 of 24

DecoPac's would probably be the way to go. Something quick, simple and easy.

pj22 Posted 22 Sep 2011 , 10:26pm
post #19 of 24

I don't think there is any other option to get in their letters. They just put the name as a preferred or recommended vendor.

What do you think of the Decopac idea? I know those kits are popular. And those wanting to order for another event can refer to my usual cake prices.

Or anyone have any generic decoration ideas that I can standardize specially for this gym?

I really appreciate your help everyone! I'm going to have good prep when I meet them tomorrow. Please suggest and advice since I'm new to all this. Thanks!!

aligotmatt Posted 22 Sep 2011 , 10:34pm
post #20 of 24

I was just thinking like a stripe and polka dot, ribbon, simple bow in the corner kind of designs. A step up from a grocery store, but nothing mind boggling.

pj22 Posted 22 Sep 2011 , 10:50pm
post #21 of 24

Thanks aligotmatt... I'll probably have to make those designs and upload pics.

I was thinking about the Decopacs and was wondering what reasons would compel customers to get the cakes from me rather than the grocery store when the decoration is the same? My cakes would taste better since I make from scratch but would they really mind when it comes to getting the same cake for cheaper? Thoughts??

pj22 Posted 22 Sep 2011 , 11:06pm
post #22 of 24

Or do you guys suggest increasing my prices and offering a 10% or 15% discount?? Do people like receiving a percent off discount or free goodies? Maybe I could offer 1 dozen mini cupcakes free for the next order for anyone who places their birthday cake order with me at full price? I'll do the free delivery however... any thoughts?

Kiddiekakes Posted 22 Sep 2011 , 11:23pm
post #23 of 24

Personally I think asking you to discount your cakes further and deliver them for free is too much...Why should you offer a discount?Is the venue upcharging the cakes after you deliver them?The cost of the delivery fee should be discount enough and really...when a cake is included in a party package like what the gym is doing...most parents just pay the party package fee and are done with it..They aren't looking for free/extra deals.I have a agreement somewhat like this with a Birthday Party entertainment company..The owner would contact me and order a cake and then add extra on for them coming and getting it etc..After a while they got miffed at me because I raised my prices..My parogative...now she sends the customer directly to me and we work out the details..no discounts etc..If they want to order a cake they do..if not..no worries...I just think it should be up to you to decide if you are willing to give a discount..not the gym requiring you to before they will refer you...don't let them run your business for you...

pj22 Posted 22 Sep 2011 , 11:30pm
post #24 of 24

You are right kiddikakes but I guess they want to attract customers to buy from me since I offer a discount.... otherwise the parents are free to go anywhere else. The gym isn't upcharging or dealing with cakes at all. I'm thinking that I'll raise my prices as everyone suggested and offer a 10% discount and free delivery. If people want Decopac, it will be an additional $10. I also do edible images so that will be crowdpuller too I hope!

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