Breezy09 Posted 19 Apr 2012 , 5:07am
post #1 of

Hello All!

I am new to here, and I hate that my first post has got to be one of sadness, but I really just need some opinions. I have been selling my cakes now for 2 years and I have a decent sized customer basis, but I want to be able to expand to a somewhat larger one. The problem is that I always get a ton of people interested in placing an order and then a lot of them immediately back away as soon as I mention price icon_sad.gif

I have done a lot of research in my area and what I want to charge is super competitive compared to all the bakeries in my general vicinity. What am I doing wrong? Because I am a smaller business do people expect me to charge less?

27 replies
Tails Posted 19 Apr 2012 , 8:02am
post #2 of

Perhaps ask budget first and then suit the cakes to match the budget?

If you ask them what cake they want, and they say they want XYZ, and you give them a large price for the cake they want (note: the right price for the cake they want), they'll back away.

BUT

If you ask them their budget and they say $50 then you offer them the best cake they can get for that price. They should be more likely to accept icon_smile.gif

scp1127 Posted 19 Apr 2012 , 9:45am
post #3 of

Because this industry notoriously hides the prices, worse than any other industry, you will get inquiries from people who have no idea what the prices are, even a ballpark. So it may be that all bakers are out of their budget.

Tails has excellent advice in the post above that could save you from extra work.

I have all pricing on my site, but I still get inquiries about things not on the menu. After awhile, you should be able to tell if a client is ok with your initial price. If they are phone or email inquiries, just give them the price and move on after you give the perks of booking with you. On big orders, they will always shop, so if your prices and skills are in line with market pricing, you need to look closer at your website, your initial information to the client, and any other first impression.

Hope this helps. Give us more specifics and maybe we can help further.

Breezy09 Posted 19 Apr 2012 , 1:24pm
post #4 of

Thanks to both of you! That is a good idea to ask about their budget first before going onto an actual estimate quote! For all the time I have been doing this, I've always asked people specifically what they were wanting and then gave them a quote.

So now my question is, if they start out by specifically stating what they want and I know that the pricing is going to be expensive, should I avoid telling them how much a cake like that would cost before getting a ballpark of their budget? And, when a customer has an unrealistic expectation as to how much a cake should cost, what is the best way of trying to talk them down into a cake that'll more suit their budget without potentially scaring them off?

I have to admit I'm a little bit of an amateur when it comes to this area of my business. For the past 2 years, I have catered to customers who have already heard of me via word of mouth from other customers I made cakes for already. So, they already have an idea of how I price before even speaking with me. However, a lot of these people I'm trying to communicate with now have absolutely no idea how pricing works outside of Safeway or Costco

dinascakes Posted 19 Apr 2012 , 1:43pm
post #5 of

The thing is that a lot of people want a custom designed cake like on Cake Boss or Ace of Cakes, on a Walmart budget. Like the saying goes, champagne taste on a beer budget. You can't lower your standards or prices for them. Once they call around and see that every other place charges those prices too, they'll come to realize that they have to pay out or settle for the Walmart cake.

On a side note, I really wish they would put prices of cakes on those shows. I went onto Charm City Cakes website one time and a small 8" cake designed by one of they're cake decorators (not custom, ready made) is $200 and a custom order cake begins at $1000!! People not in the cake business don't realize this. :/

jgifford Posted 19 Apr 2012 , 2:17pm
post #6 of
Quote:
Originally Posted by dinascakes

The thing is that a lot of people want a custom designed cake like on or Ace of Cakes, on a Walmart budget. Like the saying goes, champagne taste on a beer budget. You can't lower your standards or prices for them. Once they call around and see that every other place charges those prices too, they'll come to realize that they have to pay out or settle for the Walmart cake.

On a side note, I really wish they would put prices of cakes on those shows. I went onto Charm City Cakes website one time and a small 8" cake designed by one of they're cake decorators (not custom, ready made) is $200 and a custom order cake begins at $1000!! People not in the cake business don't realize this. :/




Do you suppose it would do any good to start a letter-writing campaign?

mplaidgirl2 Posted 19 Apr 2012 , 2:40pm
post #7 of
Quote:
Originally Posted by jgifford

Quote:
Originally Posted by dinascakes

The thing is that a lot of people want a custom designed cake like on or Ace of Cakes, on a Walmart budget. Like the saying goes, champagne taste on a beer budget. You can't lower your standards or prices for them. Once they call around and see that every other place charges those prices too, they'll come to realize that they have to pay out or settle for the Walmart cake.

On a side note, I really wish they would put prices of cakes on those shows. I went onto Charm City Cakes website one time and a small 8" cake designed by one of they're cake decorators (not custom, ready made) is $200 and a custom order cake begins at $1000!! People not in the cake business don't realize this. :/



Do you suppose it would do any good to start a letter-writing campaign?




The smallest cake from Charm City is now $250. I actually tell people that. Hey You want an 8 inch round that starts at XYZ.... Did you know Charm City charges $250 for this size with pre picked designs?! Then they think they are getting a deal. As long as you slide it into the conversation. They never know you are doing it to benefit yourself

Claire138 Posted 19 Apr 2012 , 2:47pm
post #8 of

My brother recently called CakeBoss & was told that the starting price was $1,000 for a simple design! He also said they were quite rude on the phone and did not seem interested in his business at all so he went elsewhere!

KoryAK Posted 19 Apr 2012 , 5:49pm
post #9 of
Quote:
Originally Posted by mplaidgirl2

Quote:
Originally Posted by jgifford

Quote:
Originally Posted by dinascakes

The thing is that a lot of people want a custom designed cake like on or Ace of Cakes, on a Walmart budget. Like the saying goes, champagne taste on a beer budget. You can't lower your standards or prices for them. Once they call around and see that every other place charges those prices too, they'll come to realize that they have to pay out or settle for the Walmart cake.

On a side note, I really wish they would put prices of cakes on those shows. I went onto Charm City Cakes website one time and a small 8" cake designed by one of they're cake decorators (not custom, ready made) is $200 and a custom order cake begins at $1000!! People not in the cake business don't realize this. :/



Do you suppose it would do any good to start a letter-writing campaign?



The smallest cake from Charm City is now $250. I actually tell people that. Hey You want an 8 inch round that starts at XYZ.... Did you know Charm City charges $250 for this size with pre picked designs?! Then they think they are getting a deal. As long as you slide it into the conversation. They never know you are doing it to benefit yourself




Just peeked at their site... that $250 cake is a "cake for two"! It's a 4" or 6" round. So even better for your clients icon_smile.gif

jgifford Posted 19 Apr 2012 , 5:51pm

Lol - I think I'll make a dummy 6" and put a sign on it - - "This would cost you $250 from Duff". What do you think - - would it do me any good?

Breezy09 Posted 19 Apr 2012 , 6:09pm
Quote:
Originally Posted by jgifford

Lol - I think I'll make a dummy 6" and put a sign on it - - "This would cost you $250 from Duff". What do you think - - would it do me any good?




OMG I literally laughed out loud at that. It's a good idea!

Spuddysmom Posted 19 Apr 2012 , 6:18pm
Quote:
Originally Posted by jgifford

Lol - I think I'll make a dummy 6" and put a sign on it - - "This would cost you $250 from Duff". What do you think - - would it do me any good?




Okay, is there a "genius idea" award we can give you? This is brilliant!

jgifford Posted 19 Apr 2012 , 6:22pm

icon_redface.gif Thank you, thank you. My job here is done.

imagenthatnj Posted 19 Apr 2012 , 6:24pm

It's really 8 inches, 3 layers...might have to get a bigger dummy.

FROM HIS SITE:
Do they really only feed two?

No. Every Cake for Two is an 8-inch round cake with 3 layers of cake inside. They actually feed about 15. But "Cakes for Fifteen" didn't have as nice a ring to it.

jgifford Posted 19 Apr 2012 , 6:36pm
Quote:
Originally Posted by imagenthatnj

It's really 8 inches, 3 layers...might have to get a bigger dummy.

FROM HIS SITE:
Do they really only feed two?

No. Every Cake for Two is an 8-inch round cake with 3 layers of cake inside. They actually feed about 15. But "Cakes for Fifteen" didn't have as nice a ring to it.




That's still a ridiculous amount for an 8". I'm making an 8" next week for a co-worker. I can just imagine her face if I told her the price was $250. icon_eek.gif

imagenthatnj Posted 19 Apr 2012 , 6:43pm
Quote:
Originally Posted by jgifford

Quote:
Originally Posted by imagenthatnj

It's really 8 inches, 3 layers...might have to get a bigger dummy.

FROM HIS SITE:
Do they really only feed two?

No. Every Cake for Two is an 8-inch round cake with 3 layers of cake inside. They actually feed about 15. But "Cakes for Fifteen" didn't have as nice a ring to it.



That's still a ridiculous amount for an 8". I'm making an 8" next week for a co-worker. I can just imagine her face if I told her the price was $250. icon_eek.gif




Completely agree. Just wanted people to know the right measurement.

He says it feeds 15 people. That would be about $16 a serving. Yikes. But, the Wilton site states it would serve 24. Still expensive per serving.

Jimbos76 Posted 19 Apr 2012 , 6:55pm

"By popular demand....announcing Cakes for Two! Why? Because so many of our fans have told us that they'd really like to get a cake from us, and get a peek inside our shop, but can't because our custom cakes aren't within their price range and/or we don't offer tours of the bakery. Cakes for Two is the answer to those requests - smaller cakes that are reasonably priced that you can pick up here at our shop. Each of our decorators have designed several playful, bright, and elegant cakes that capture the popular styles for which Charm City Cakes is known and loved. Select the design you'd like, pick your flavor, and you've got a cake! Cakes for Two are not customizable like our other cakes, but we think the designs we've come up with will serve nearly any special occasion fantastically. They also make great gifts for your friends, family, or out-of-town visitors!"

From the website....what gets me is "smaller cakes that are reasonably priced." These cakes are $250! I just can't imagine saying to someone that $250 is a reasonable price for an 8 in. cake that is not custom decorated! I just can't believe that there are that many people out there willing to pay that. Mind boggling!

jason_kraft Posted 19 Apr 2012 , 7:13pm
Quote:
Originally Posted by Jimbos76

I just can't believe that there are that many people out there willing to pay that.



I can, some customers are willing to pay a hefty premium for a brand name. Some people spend twice as much on a designer purse that costs half as much as a Charm City mini cake to make.

Jimbos76 Posted 19 Apr 2012 , 7:35pm

I guess I feel that way because at least with a designer purse, jeans, etc. you get use out of them (I still wouldn't pay that much money for those things either) but with cake, you eat it and it's gone! I know there are people out there who think nothing of spending money like that and have the money to do so but they way the website makes it sound, there are a lot of people asking for those cakes and at $250 per cake I just can't believe it.

Breezy09 Posted 19 Apr 2012 , 7:45pm

Just as a side note....

Carlo's Bakery now at least has a page in which you can view pricing for a few select items....

http://holiday.carlosbakery.com/pickup/

jason_kraft Posted 19 Apr 2012 , 7:47pm
Quote:
Originally Posted by Jimbos76

I guess I feel that way because at least with a designer purse, jeans, etc. you get use out of them (I still wouldn't pay that much money for those things either) but with cake, you eat it and it's gone!



If you look at how much use you can get out of a $500 purse versus a $50 purse, it's probably roughly equivalent. The value is derived from how others perceive the owner of the purse after seeing the designer logo. It's no different with Charm City, as their customers are looking mostly for cachet. You're right that the direct impact of the cake is more short lived, but seeing as the cake is often the center of attention for the event the net gain in cachet is more concentrated (and more unique) than carrying around a designer purse.

costumeczar Posted 19 Apr 2012 , 9:34pm
Quote:
Originally Posted by jgifford

Quote:
Originally Posted by imagenthatnj

It's really 8 inches, 3 layers...might have to get a bigger dummy.

FROM HIS SITE:
Do they really only feed two?

No. Every Cake for Two is an 8-inch round cake with 3 layers of cake inside. They actually feed about 15. But "Cakes for Fifteen" didn't have as nice a ring to it.



That's still a ridiculous amount for an 8". I'm making an 8" next week for a co-worker. I can just imagine her face if I told her the price was $250. icon_eek.gif




Oh, but on the site it says that this a bargain price for people who long for a Charm City Cake but who only want to pay a smaller fee. So if it says that, it must be true!

icon_rolleyes.gif

costumeczar Posted 19 Apr 2012 , 9:37pm
Quote:
Originally Posted by jason_kraft

Quote:
Originally Posted by Jimbos76

I guess I feel that way because at least with a designer purse, jeans, etc. you get use out of them (I still wouldn't pay that much money for those things either) but with cake, you eat it and it's gone!


If you look at how much use you can get out of a $500 purse versus a $50 purse, it's probably roughly equivalent. The value is derived from how others perceive the owner of the purse after seeing the designer logo. It's no different with Charm City, as their customers are looking mostly for cachet. You're right that the direct impact of the cake is more short lived, but seeing as the cake is often the center of attention for the event the net gain in cachet is more concentrated (and more unique) than carrying around a designer purse.




Jason, you're such a boy. Women are going to think that a Chanel bag is far more awesome than a $250 Charm City cake. The only cachet that will stick to you for buying that is the cachet of failure when your friends find out how much you paid for an 8" round and laugh at you behind your back.

jason_kraft Posted 19 Apr 2012 , 10:18pm
Quote:
Originally Posted by costumeczar

Women are going to think that a Chanel bag is far more awesome than a $250 Charm City cake.



Taking an economic view, you're absolutely right...the bag in my example has a $450 premium for the brand, while the Charm City cake might be a $150 premium, so the bag would be three times as awesome.

Quote:
Quote:

The only cachet that will stick to you for buying that is the cachet of failure when your friends find out how much you paid for an 8" round and laugh at you behind your back.



I was speaking in general terms to explain that the market for this type of product definitely exists. Whether the cachet "sticks" or not is irrelevant, the only thing that really matters from a marketing perspective is that the customer thinks others are impressed that their purse has a certain logo or that the bakery from a TV show made their cake.

By limiting their offerings to the super-premium segment only Charm City is creating product scarcity that will help enhance their image among their target market. The rest of us may think they and their customer base are nuts, but that doesn't really matter since we aren't their target.

It's interesting that Carlo's Bakery is taking the opposite approach by branching out to provide products for the mainstream market. Both strategies have their place and I'm sure both can be successful.

costumeczar Posted 19 Apr 2012 , 11:53pm
Quote:
Originally Posted by jason_kraft

Quote:
Originally Posted by costumeczar

Women are going to think that a Chanel bag is far more awesome than a $250 Charm City cake.


Taking an economic view, you're absolutely right...the bag in my example has a $450 premium for the brand, while the Charm City cake might be a $150 premium, so the bag would be three times as awesome.

Quote:
Quote:

The only cachet that will stick to you for buying that is the cachet of failure when your friends find out how much you paid for an 8" round and laugh at you behind your back.


I was speaking in general terms to explain that the market for this type of product definitely exists. Whether the cachet "sticks" or not is irrelevant, the only thing that really matters from a marketing perspective is that the customer thinks others are impressed that their purse has a certain logo or that the bakery from a TV show made their cake.

By limiting their offerings to the super-premium segment only Charm City is creating product scarcity that will help enhance their image among their target market. The rest of us may think they and their customer base are nuts, but that doesn't really matter since we aren't their target.

It's interesting that Carlo's Bakery is taking the opposite approach by branching out to provide products for the mainstream market. Both strategies have their place and I'm sure both can be successful.




Oh my God, Jason, take off your analyst hat for two mintues and relax! The purse vs. cake example has nothing to do about economics and the direct relation between price and awesomeness in a woman's mind. Women in general like purses more than cakes, that's all it is. And we will make fun of someone if we think they spent too much on a cake, but not on a purse. We may think someone spent too much, and we would never spend that much, and we might talk about it with our other friends, but we have a visceral purse reaction in the reptilian parts of our brains that rationalizes the purse cost. There is no such part of the female brain assigned to 8" cakes. Ask your wife to explain it to you. Or to smack you in the head with her purse, hahahaha! icon_razz.gif

jason_kraft Posted 20 Apr 2012 , 12:02am

Everything has to do with economics. icon_lol.gif

costumeczar Posted 20 Apr 2012 , 12:16am
Quote:
Originally Posted by jason_kraft

Everything has to do with economics. icon_lol.gif




Not in the reptilian purse-brain. That has more to do with soft Italian leather icon_rolleyes.gif

tokazodo Posted 20 Apr 2012 , 12:18am
Quote:
Originally Posted by jgifford

Lol - I think I'll make a dummy 6" and put a sign on it - - "This would cost you $250 from Duff". What do you think - - would it do me any good?




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