AI never knew so many people would be mad at the way I price MY cakes or run my business. It works for me, I make a living off of it & I love it. But again everyone is different. I can't fail due to the fact that I have a huge financial support system & my cakes are doing extremely well. Calm down, this is my well being & it is working very well for me. Thank you & I'm very sorry for your bitterness people. if someone with a shop would like to state an opinion I will gladly except your criticism for now all the rest of you please don't get upset if cakes is not your living.
A
Original message sent by CakeDolls
I never knew so many people would be mad at the way I price MY cakes or run my business. It works for me, I make a living off of it & I love it. But again everyone is different. I can't fail due to the fact that I have a huge financial support system & my cakes are doing extremely well. Calm down, this is my well being & it is working very well for me. Thank you & I'm very sorry for your bitterness people. if someone with a shop would like to state an opinion I will gladly except your criticism for now all the rest of you please don't get upset if cakes is not your living.
It is pretty vain to assume the people giving advice on here don't make their living doing cakes or have a shop. Some of the top decorators in the US, UK and Australia are on this site. Having a huge financial support doesn't prevent a business from failing. When you have to take from that support rather than being a self sustaining business, that is failing.
The reason people get upset about undercutting is that you devalue the market. If your product is worth market value, why not charge market value? And these people are actually relying on their cake business to put food on their table, not having "huge financial support". When you undercut you are taking food from their kids mouths. And when the time comes that you need or want to raise your prices you will find it difficult because someone out their will be selling cakes on Craigslist and undercutting YOU.
AI'm not upset, who's jealous of someone who is walking away from money?
Don't confuse 'bitterness' with 'what you don't want to hear'.
I don't ever want to see a fellow CC member fail but you are crazy if you think your customers are suddenly going to start paying more just because the cake is picked up from a store instead of your home. A business with a 'huge financial support system' is not successful, it's a charity.
A
Original message sent by AZCouture
Why the heck would you do that?
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I'm not upset, who's jealous of someone who is walking away from money?
Don't confuse 'bitterness' with 'what you don't want to hear'.
I don't ever want to see a fellow CC member fail but you are crazy if you think your customers are suddenly going to start paying more just because the cake is picked up from a store instead of your home. A business with a 'huge financial support system' is not successful, it's a charity.
THIS
Actually no, but im guessing i just turned out lucky. I actually had someone make all my flyers free but all my clients are from word of mouth, I have about 5-7 cakes a week. I've actually made a living off cakes (meaning its my full time job) for over 2 years now , I am in the process now of opening my own shop, thankfully I've been able to save ALL of my own money enough to get a website & shop up & running. (All this with the help of my significant other ofcourse) so for me it has been easier than most which I am grateful for. My cake supplies I actually get extremely cheap, I coupon mostly everything so regardless of pricing It always works out fairly well.
I was simply pointing out that 'no overhead' is impossible. You are very lucky, also in that you have a significant other who can/will help pay for things.
However, every time you turn you oven on to bake a cake, or plug your mixer in to make butter cream, you are accruing overhead expenses. If you are not charging for them, they are eating your profit. That was all I was saying.
I think you would be surprised at how many of us make our livings at this, actually most everyone who replied to this run very successful businesses.
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Because where I live the cakes are actually overpriced in my eyes (my opinion) for example I got a quote for a two tiered cake (8" & 6") with a mini giraffe topper & they were charging $375 so I would do it for about $325. But its just what works for me & how i get more customers. Btw I love your work , very nice.
You are confusing "overpriced" cakes with just wanting to undercut your competition. Someone else charges $375, so you just charge $50 less to get the job? It is a good thing you've got a "financial support system" in place instead of actually figuring out how much it costs to price a job without relying on another baker to do the math for you.
Liz
AYou're going to develop quite the reputation in your community. :-)
I too have a wonderful support system from my hubby. I could not do all this without him. But when you talk overhead - you are right. I don't know how to figure all the expenses by using your oven or the electricity from the mixer but I do know my husband says he's the only one who turns on the AC to keep my kitchen cool so the icing does not melt off my cakes. Of course I would not be fit to live with either being hot, sticky and have cakes slip-sliding. He absorbs all this just to let me bake. How would get a cost factor for overhead. Also how do you figure your hourly wage unless you worked in a commercial bakery before? Grammy 1963
A
Original message sent by liz at sugar
You are confusing "overpriced" cakes with just wanting to undercut your competition. Someone else charges $375, so you just charge $50 less to get the job? It is a good thing you've got a "financial support system" in place instead of actually figuring out how much it costs to price a job without relying on another baker to do the math for you.
Liz
Do you think I should charge the same price as a cake shop without my shop open yet ? Serious question. I think it isn't fair since I do not pay what the local shops pay to run the business. I don't try to take people's business, or even know if the customer is aware of the others prices.
Grammy 1963 - You can get a rough estimate by just taking a portion of your monthly utitlity bills. If you use your kitchen 80% of the time for personal meals, and 20% for baking, just figure 20% of your electric, water and gas bill each month to "allocate" to cakes. Same with wages - figure out how much you would like to make an hour and then make sure you are charging for that time in the figure you estimate for each cake.
Liz
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I never knew so many people would be mad at the way I price MY cakes or run my business. It works for me, I make a living off of it & I love it. But again everyone is different. I can't fail due to the fact that I have a huge financial support system & my cakes are doing extremely well. Calm down, this is my well being & it is working very well for me. Thank you & I'm very sorry for your bitterness people. if someone with a shop would like to state an opinion I will gladly except your criticism for now all the rest of you please don't get upset if cakes is not your living.
Ok, well, I have a shop (retail storefront, brick and mortar, whatever else you want to call it) and I have a major problem with anyone undercutting in our industry, and especially with thinking they have no overhead just because they work out of their home. If you are a business and you sell things, you have overhead. Period. It's probably not as much as someone with a storefront, but you DO have it.
If you have a huge financial support system, that's great and all, but how do you know how successful your business actually is if that's what supports it? As others have said, a successful business is one that supports itself with the money generated from sales.
Undercutting hurts everyone in the cake business, because it drags the value of our product down. And you've got people like me trying to establish a shop and yes, make a living doing this while tons of people working out of their home are undercutting and stealing business. And consequently making the public think that we overcharge because how else could they get cakes so much cheaper from the lady down the street?
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Do you think I should charge the same price as a cake shop without my shop open yet ? Serious question. I think it isn't fair since I do not pay what the local shops pay to run the business. I don't try to take people's business, or even know if the customer is aware of the others prices.
I think you should actually figure your costs and your time and not rely on the prices of other bakers. You have no idea how much they pay for ingredients, or their overhead. They could be making $200 profit on a $375 cake, while you could be making $50 profit on the same cake that you charged $325 for. If you are talented, and complying with the law, it doesn't really matter if you bake from a home kitchen or commercial kitchen when it comes to your pricing.
Good luck!
Liz
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I think you should actually figure your costs and your time and not rely on the prices of other bakers. You have no idea how much they pay for ingredients, or their overhead. They could be making $200 profit on a $375 cake, while you could be making $50 profit on the same cake that you charged $325 for. If you are talented, and complying with the law, it doesn't really matter if you bake from a home kitchen or commercial kitchen when it comes to your pricing.
Good luck!
Liz
I agree. That's why when people respond to these questions, even if they say what they would charge, they usually say "but that's me, you need to figure your own costs." Taking the price of the competitors and subtracting $50 is pretty arbitrary.
To Liz at sugar: Thankyou for the info I will do that just to see where I fit in. I appreciate your input. Gramy1963
A
Original message sent by LoveMeSomeCake615
Ok, well, I have a shop (retail storefront, brick and mortar, whatever else you want to call it) and I have a major problem with anyone undercutting in our industry, and especially with thinking they have no overhead just because they work out of their home. If you are a business and you sell things, you have overhead. Period. It's probably not as much as someone with a storefront, but you DO have it.
If you have a huge financial support system, that's great and all, but how do you know how successful your business actually is if that's what supports it? As others have said, a successful business is one that supports itself with the money generated from sales.
Undercutting hurts everyone in the cake business, because it drags the value of our product down. And you've got people like me trying to establish a shop and yes, make a living doing this while tons of people working out of their home are undercutting and stealing business. And consequently making the public think that we overcharge because how else could they get cakes so much cheaper from the lady down the street?
Yes this I definitely understand. As for My pricing I don't base it completely on others, as I said before just for larger cakes. There are several shops that don't do the same cakes I have done before so I can't get quotes, I did have a problem pricing 3 tier very detailed cakes so yes I did look for help and get a quote from a local bakery. it's been a big learning process so after 2 years I am figuring it all out , yes I have help and it would've probably taken me 5 or 6 years to get where I am at now if it was just me & I would never want to make others lose business, i am open to constructive criticism, even though to me it is working out. Cakes are in such high demand where I live at.
Hi cake dolls: Funny I did a similar cake for my10 yr. old grandson. You are right How do you figure a cost, if you are like me, I go to bed sketching in my mind and trying to put all ideas together. It would be different if you did a cakes like these every day. When I do something really different my mind gets all cluttered up with scads of ideas. So you are actually working a lot more hours mentally. I guess we do the best we can as long as we are happy with it and hope our customer will be equally pleased. Good luck/ Grammy1963
AThis is such a sticky, delicate subject.
I really do wish that people operating under Cottage Food Laws or otherwise from home would understand a few points:
[B]There is still overhead to pay[/B]. For me, this is difference in utility costs, licenses, insurance, web hosting fee, Domain fee, business cards, subscription CC magazine, ICES membership fee, & Charleston Bridal Association fee.
[B]Although overhead may be less, discounts are also less[/B]. Many large suppliers like US Foods & Sysco will not deliver to non commercial addresses. I am unable to take advantage of the purchasing power others get.
[B]Volume[/B] larger bakeries can hire more employees & produce more items than I can. I limit myself to one wedding per weekend. The bakery where I used to work does about 4-8 depending on size & complexity.
It doesn't exactly break even, but it is certainly close.
I base my price on costs, time, & market value. Some in my area charge $3.75. Others range around $5.00. The big man on campus starts at $8.00. I charge $4.50. For me, that's reasonable.
If after subtracting true expenses you are not making a profit, the business is Not successful. That is a definition not an opinion.
AUnless those bakeries are all going out of business they are not overcharging.
The biggest mistake a lot of people make is forgetting that they may not be their customer. The Ferrari salesman likely can't afford to pay retail for a Ferrari of his own, but that doesn't mean he knocks down the price.
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Do you think I should charge the same price as a cake shop without my shop open yet ?
Yes. Once you open shop you will have to raise your prices to cover the added expense. Your customer base comes you because of your price, in part. You will lose a lot of your customers when prices increase, and will have to start from scratch building a new customer base.
I am glad you are open to advice 
You make 5-7 cakes a week and charge $40 under market for each and have done this for 2 years? Let's see...that's an average of 6 cakes a week, I'll give you a whole month off for vacation, so that's over $21,000 you've donated in cake subsidies over the last two years. That's pretty funny!
6 cake a week x $40 = $240 a week That's $960 a month x 22 months.
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You make 5-7 cakes a week and charge $40 under market for each and have done this for 2 years? Let's see...that's an average of 6 cakes a week, I'll give you a whole month off for vacation, so that's over $21,000 you've donated in cake subsidies over the last two years. That's pretty funny!
6 cake a week x $40 = $240 a week That's $960 a month x 22 months.
Math doesn't lie. :)
Liz
AI was a little insulted at being told cakes are overpriced.
Also, am I mistaken in my understanding that when she needs to give a customer a quote, she calls up other bakeries and wastes their time getting quotes that she will undercut? :-/
AA
Original message sent by howsweet
You make 5-7 cakes a week and charge $40 under market for each and have done this for 2 years? Let's see...that's an average of 6 cakes a week, I'll give you a whole month off for vacation, so that's over $21,000 you've donated in cake subsidies over the last two years. That's pretty funny!
6 cake a week x $40 = $240 a week That's $960 a month x 22 months.
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A
Again if you read closely I have done that for the cake I explained I had no idea how to quote and needed help but most of my cakes are orders as in the pictures I posted. Actual items not so much tiered cakes.
You are so funny! Either you're a troll or worse, a real person blatantly stating that your business model is designed around undercutting other bakers. The last thing I'm going bother with is reading more closely.
I think she really didn't understand what she was doing or how it affected the market....
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Unless those bakeries are all going out of business they are not overcharging.
The biggest mistake a lot of people make is forgetting that they may not be their customer. The Ferrari salesman likely can't afford to pay retail for a Ferrari of his own, but that doesn't mean he knocks down the price.
Exactly! Shoot, I couldn't afford one of my cakes, yet there hasn't been a single time I sat back after finishing a project and thought "gee, that didn't take long, and it wasnt' that difficult, I should lower the price next time."
I. Am. Not. My. Customer.
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A
Again if you read closely I have done that for the cake I explained I had no idea how to quote and needed help but most of my cakes are orders as in the pictures I posted. Actual items not so much tiered cakes.
I hope that's the case, because you sure had a different tone about it in previous posts, like you were quite happy and established with your pricing method.
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