I Don't Think I Was Overcharging, But She Seemed To Think So

Decorating By ieatcakes157 Updated 27 Oct 2011 , 8:22pm by nelullah

ieatcakes157 Posted 23 Oct 2011 , 8:07pm
post #1 of 27

Heya,
An old school friend recently asked me how much i'd charge for a round star cake, and i said £14.
Included for the £14 would be a cake box to put it in (around £2.30 off ebay), a cakeboard (£1) plus the costs of ingredients & electric to cook it. After all that id be making about £6 profit, if that.
She then turned round and said she didnt want it as it costs a lot, and it wasn't worth it.
As a beginner, my cakes take quite a lot of time to do, and this has made me quite angry, as id barely make anything from it! And its actually quite dented my confidence in cake making completely.
Was I over charging? icon_sad.gif

26 replies
NerdyGirl Posted 23 Oct 2011 , 8:35pm
post #2 of 27

If you give her a breakdown by how much you pay for every item, and how much you would pay yourself, she might understand it better - and realize she's getting an amazing deal.

My husband thought I overcharged until I gave him a breakdown. Enlightening for him, to say the least!

step0nmi Posted 23 Oct 2011 , 8:38pm
post #3 of 27

i don't know anything about pounds...but i didn't see you putting some cost in there for your time! so, you basically just want to cover your costs? I think that's cheap...you always have to think that you need to be paid for your time or else it's not business, you're just doing a favor for a friend!

most people that don't cake decorate don't understand the costs that go into baking and providing a cake...they may think "oh they just get a box cake which is X amount of cost". it is VERY enlightening if you broke it down for them icon_wink.gif

Davwattie Posted 23 Oct 2011 , 8:46pm
post #4 of 27

You werent asking enough!

I know I probably dont charge what most do around me but if she looked around on the internet I can guarantee she wouldnt get what she wanted for less than £25.

Google cake makers near your postcode most will have a basic start from price for a very plain decorated cake. if she asks in the future you can tell her what others charge

Dont let it stop you, you will find people who are happy to pay what you are worth

MimiFix Posted 23 Oct 2011 , 8:50pm
post #5 of 27

But for many people, anything you charge for a cake is too much...

When you see an expensive work of art or a piece of designer clothing or the newest electronic gadget, do you think, "They're overcharging" or do you simply think "That's a lot of money"?

LisaPeps Posted 23 Oct 2011 , 9:14pm
post #6 of 27

Have a look at The Cake Gallery in Kings Norton, Bham. They have their prices on their website. You would have charged far too little, you could barely get a Tesco cake or Morrisons cake for £14... I live near Redditch, at the minute I charge £35 for an 8" round and £47.50 for a 10" round. I haven't managed to sit down and figure out my pricing spot on but there's no way I'd even consider doing a cake for £14.

JennTheCakeLadie Posted 23 Oct 2011 , 9:16pm
post #7 of 27

I used to worry a lot about charging too much. Someone very wise, (and also a successful bakery manager) once told me something to make me feel a lot better... "It's their loss."

If you plan to sell your cakes, you have to set a price that you feel comfortable with. If it's more than their willing to pay, don't be angry, it's their loss. As someone above pointed out, just because they aren't willing to pay the price, doesn't mean it's a personal insult to you. It just means it's more than they were willing to pay. I've also found that once I started making cake, I suddenly had a lot of "Friends" who needed cakes made, and expected me to make them for nothing. I was baking myself silly. It took a lot of time to realize that this is a business, and I have to charge what makes it worth my time and effort. It's up to you if want to give a "discount" because they are a friend. There are very few people in my life I will make a cake for and not charge full price.

These days, when someone says, "Can you make me a cake?" I find out what they are looking for, and immediately tell them, it will cost you this much. The most common comment is "I can get it from Costco or Walmart for less than that." I explain to them that a) I don't get wholesale prices for ingredients, b) my cakes tastes way better, and c) my cakes don't get shipped in from the other side of the country, pre-made and frozen. I can't afford to charge what those places charge.

If they don't want to pay for your time, talent, and love that you are putting into art, it's their loss. Don't take it personal, and don't stop being their friend because of it.

NerdyGirl Posted 23 Oct 2011 , 9:22pm
post #8 of 27

I've been educating my friends as to what goes into a cake. Even a small cake. So far, they've been quite happy to pay the price I set because they know what goes into it. They also appreciate that these are cakes made the way they want them for a truly personal touch.

I also educated them about Costco, Walmart, etc. They're amazed when they hear how their "special" cakes are treated.

BizCoCos Posted 23 Oct 2011 , 9:43pm
post #9 of 27

That's a little over 21 us dollars, that's insane hon, let her walk away, electricity and or gas, flour eggs, icing, time labor, etc. Only a grocery store can do that and they taste horrible. I went grocery shopping todat and an italian rum cake about 9 inches by 5 inches was 14 usa. I'm sure it was horrible. Don't be turned off by these individuals. Even if you had a cow and chickens, you would still have to milk the cow and pick the eggs (labor)!

kakeladi Posted 23 Oct 2011 , 10:01pm
post #10 of 27

when you are educating people about places like WalMart, Costco etc be sure to let them know that those places are more than happy to take a *LOSS* on the actual cake because they know the customer is going to buy other things (candles, napkins, plates, groceries, etc, etc) when they are picking up the cake. That is also one of the reason the bakery is usually located in the back of the store......so you have to walk past all those thing and say, "Oh I need this, this and this to go with the cake"............

auzzi Posted 23 Oct 2011 , 10:18pm
post #11 of 27

£6 is not profit. Looking at your costing, you are loosing money. Your method of calculation fails to take into account a myriad of costs that you incur in the production of the cake. You have not even included your labour costs. Isn't your time and ability worth anything?

Justifying a price to a client, is a slippery slope to them setting the value of what you produce. Imagine, supporting your purchasing choices ["it's cheaper at XXX, why didn't you buy there..], disputing the inclusion of government costs/ charges, or even your "wage" of $$ per hour.. It may sound silly, but there are clients who will argue until they [or you] turn blue in the face ..

As business person, which you are as you are selling a product, you NEVER give a client or customer a breakdown of how you calculate the cost of an item. No other professional in other artistic trades would dream of doing such a thing.

When a cake is "too" expensive, all they see is the cost of a cake mix in the supermarket with the attitude of "anyone can make a cake".

.

cakeyouverymuch Posted 23 Oct 2011 , 10:39pm
post #12 of 27

What auzzi said! Twice!

If your 'friend' was sitting in a restaurant and wanted a piece of cake at the end of a meal, would she haggle over the price with the waiter, or would she just pay the bloody price on the menu? And if she did try to haggle would the cook come out and try to justify the price of a piece of cake or would she find herself out on her whatsis sans cake.

When you start to explain your pricing by itemizing YOUR costs it always comes of as if you're actually trying to justify your price to yourself. At that point you've lost the battle and you may as well give the cake away.

JanH Posted 23 Oct 2011 , 11:22pm
post #13 of 27
Quote:
Originally Posted by kakeladi

when you are educating people about places like WalMart, Costco etc be sure to let them know that those places are more than happy to take a *LOSS* on the actual cake because they know the customer is going to buy other things (candles, napkins, plates, groceries, etc, etc) when they are picking up the cake. That is also one of the reason the bakery is usually located in the back of the store......so you have to walk past all those thing and say, "Oh I need this, this and this to go with the cake"............




Sams sells at slightly over wholesale prices (wholesale club with paid membership).

Is it Sams strategy to sell at a loss:

http://www.fundinguniverse.com/company-histories/Sams-Club-company-History.html

Additionally, other businesses have legal recourse if Sams charges below cost...

And Sams has been found to undercharge for gasoline, (statutory minimum price of wholesale cost plus freight and taxes plus 6% markup) which has been the subject of litigation:

http://www.agtlawyers.com/resources/articles/tire%20articles/t2003a.pdf

HTH

Candice56 Posted 23 Oct 2011 , 11:28pm
post #14 of 27

I too educated my husband on the cost of cakes as he thought the price charged was kinda high, after he saw the break down he was like heck yes you have to charge that much to turn a profit, if it's a business that's the name of the game.
Don't let someone make you feel bad for charging what your worth you will find your right clientele that can afford your quality, and yes it does take some time to build up speed but you keep at it as it will come. Good luck. thumbs_up.gif

NerdyGirl Posted 23 Oct 2011 , 11:37pm
post #15 of 27
Quote:
Originally Posted by auzzi



As business person, which you are as you are selling a product, you NEVER give a client or customer a breakdown of how you calculate the cost of an item. No other professional in other artistic trades would dream of doing such a thing.

.




I wouldn't be so sure of that. "Never" and "no other" don't always work for everyone.

Also, I'd rather have an educated client who knows the value of what they're getting from the beginning than someone I have to complain about later on Cake Central. My clients - and friends - know what to expect, why to expect it, and are HAPPY to pay the prices I charge because of it. Do I tell them everything about what goes into a cake? No. They don't know how I do it, or specifics in ingredients, etc. But they do receive fair knowledge and actually appreciate the work more.

Does this work for everyone? Probably not. Does it work for me? Yes.

Relznik Posted 23 Oct 2011 , 11:43pm
post #16 of 27

Honestly? I'd tell her to go boil her head!

My 8" round cakes start from £50.

If she wants to pay a tenner, tell her to go to Tesco or Morrisons. Because I doubt she'd get it for much less that £10 at the supermarket... and if she thinks that a home-made cake, decorated to her specifications are the same as a supermarket sponge, then she doesn't DESERVE a home-made cake!!!



icon_wink.gif

scp1127 Posted 24 Oct 2011 , 9:16am
post #17 of 27

I'm with NerdyGirl. Even my descriptions on my site give the fine ingredients. On one cake that is drastically higher than the rest, I write somthing like, sorry but this filling takes two hours to make. People love to know about processes and fine ingredients. When they talk about it at the event, the hostess can boast the fine ingredients and advanced methods that went into the cake.

I'm enthousiastic about my products and it's contagious. But I don't do it as a justification of the price, rather an explanation of value.

solascakes Posted 24 Oct 2011 , 9:58am
post #18 of 27

£14.......I wouldn't even get out of bed.

cakesnglass Posted 24 Oct 2011 , 11:15am
post #19 of 27

I have found that setting a minimum fee $50.00 has helped me stop all those request for small party cakes or as so many people say "just a small party cake". For some reason "small" to people means cheaper. If you don't have a profit after making your cakes you will eventually not enjoy the craft.

TexasSugar Posted 24 Oct 2011 , 2:11pm
post #20 of 27

Don't worry about it. She apparently wanted a cheap cake, let her go somewhere else and get it. If she can't appreciate your time and talent that goes into making a cake, then don't waste either on her. icon_smile.gif

ieatcakes157 Posted 25 Oct 2011 , 9:26am
post #21 of 27

Thank you all icon_smile.gif
If my cakes were 100% perfect, i would of charged a lot more.
I'm not really doing this to make money, its just a hobby for me really, but still its my time etc im charging for.
It is her loss, my cakes are yummy lol!

step0nmi Posted 25 Oct 2011 , 7:42pm
post #22 of 27
Quote:
Originally Posted by ieatcakes157

Thank you all icon_smile.gif
If my cakes were 100% perfect, i would of charged a lot more.
I'm not really doing this to make money, its just a hobby for me really, but still its my time etc im charging for.
It is her loss, my cakes are yummy lol!




your cakes are wonderful and VERY cute icon_biggrin.gif

i just wanted to add...your cakes can never really be perfect. but, if you don't start valuing your cakes at more (meaning including your time) then your customers wont value them more. when they see a cheap price they think cheap!

jgifford Posted 25 Oct 2011 , 8:04pm
post #23 of 27

Did you ever consider telling her she could make it herself and save even more? icon_smile.gif

jgifford Posted 25 Oct 2011 , 8:04pm
post #24 of 27

Did you ever consider telling her she could make it herself and save even more? icon_smile.gif

ieatcakes157 Posted 27 Oct 2011 , 7:04pm
post #25 of 27

lol oh god i was tempted!
Doing a cake at the minute and its coming along great (touch wood). Cant wait until she see the pic of it lol.

Noobz Posted 27 Oct 2011 , 7:52pm
post #26 of 27

Wow £14 is practically free icon_lol.gif

I would NOT give my customers a break down of costs, its one thing describing that you use fine ingredients, quality packaging etc and its another giving a complete list and price of everything. If they don't like the price initially they're going to be tight anyway, no point giving them all ur trade info as well!

nelullah Posted 27 Oct 2011 , 8:22pm
post #27 of 27

Wow! And to think I thought charging £20 for a 10" vanilla sponge cake, filled with fresh cream and strwaberry jam, then frosted with white chocolate buttercream was extortionate!
Well, thats the impression I have been given by the community here!
I have been advised to sell at practically nothing in order to bring the customers in. Which at times can be quite unfortunate because at times I am putting in so much more time and energy into my cakes instead of with my daughter.. and for what?... a profit of ZILCH icon_sad.gif !!!
There have been customers here in my area who are not even willing to pay 75p for a bespoke cupcake (eg, a chocolate sponge with chocolate ganache filling, topped with a peanut buttercream frosting, and decorated with roses/blossoms/daisies etc...)
I even had a friend asking me to do them a wedding cake for less than £200 when every other bakery were charging at least £500 - £600 for it! Arghhhhh!!
Anyways, my ranting and raving over...
I'm learning to say no to customers who just expect things at cost price, if they think they can get the same quality else-where, then be my guest!
Please dont undermine your wonderful self, all that hard work and precious time that you put into those cakes... it really does cost a lot more than we realise.. and not just in monetary value ;-P xxx

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