I am just starting my baking business and have been working on my pricing. I have made an Excel spreadsheet to calculate the cost of the cake itself but don't know what to charge for my time. How do I determine my hourly rate? While I think I have finally found my true calling, I don't have tons of experience yet. Would I base my rate on experience and increase it as I gain more experience? Thanks for the help!!
Typically your hourly rate is at least partly dependent on your experience and skill, how in demand you are. For example the really well knowns like Ron Ben Israel and Sylvia Weinstock can charge a lot more per hour than I can! We currently charge $10/hour for basic work, and $15/hour for more complicated work, like gumpaste flowers or figures.
It largely depends on your location and local cost of living. Here in California we use $15/hour (plus the hourly kitchen rental, since commercial home baking is illegal in CA).
You need to find your place in the market, subtract your costs, and the rest is yours, including profit. If there is not enough, you must up your skill or lower your costs. You can put any rate you want on your time, but if your end product price is not in line with the market and your competition, the market will put you in your proper place by no orders or too many orders. There really is no other way to do it. If it was, every business person could name their wage. When businesses name their rate and are successful doing this way, that rate was determined in a business plan where no stone was left unturned and the market viability with a good wage was in line.