AIf they don't want to pay then let them get Costco cake. Heck - go ahead and give them Costco's telephone number.
Maybe to help you flow into the you-gotta-pay-me-for-this thing. Maybe get an order blank book from Office Depot or somewhere and when someone wants a cake it gives you a prop to hopefully segue into mentioning the charges. Even if they phone you, you can say, "Oh let me get my order book."
And it's often the case that you might need a different type of clientelle. For example, I would not purchase any of my cakes--I'd be the first in line at Costco!!
Just a thought
edited to say--'transition' is the word I was searching my memory banks for and could not find--"to help you transition" was what I was trying to say
Thanks for the advice!
On their part, it is called ignorance (I think I use to be in that category).
Shame we can't educate people with a 'come and decorate a cake day' (but often cakes take many hours or days to complete). They would soon realise the time, effort and skill required to produce a decent cake, oop's almost forgot the cost of ingredients, is worth every dime plus more......but then again.......
The order book is a great idea. It would let them know up front how much you need to outlay in time and money.
There are two ways to get your cakes to the people:
1. Charge them full price, including your hours of labour and profit.
2. Gve them a cake, at YOUR discretion, as a GIFT. No charge.
After enough years of doing this, I have concluded there is no middle ground. The only other way of distributing your cakes to the masses I will concede is giving a 'family and friends discount'. Note that this still covers your costs, including labour. It just reduces your profit a bit. This is STILL at your discretion, and at a discount amount that suits YOU.
If you have trouble doing this, make sure you cost out every red cent of a cake order, THEN show your family and friends the discount given.
AFYI, if you bake from home and want to legally charge for cakes you will need to register under California's new cottage food law, which goes into effect Jan 1, 2013. Contact the LA County health dept for more info.