Pricing A Cake

Decorating By Shnaw2006 Updated 27 Apr 2014 , 7:44pm by MBalaska

Shnaw2006 Posted 24 Apr 2014 , 8:12pm
post #1 of 13

I had a friend request that I make her son a graduation/going away cake and she just asked me to figure out what I wanted money wise and let her know. I have never made a cake for money before and I have no idea how to charge for it. 
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Basically I am making a pair of life size military boots sitting on top of a cake, a graduation cap either hangin on the side or propped up somewhere (depending on how it cooperates with me) and then enough cupcakes to feed about 40 people. The boots are carved/stacked and covered in fondant and the hat will be as well. I did a trial run today and it took me about 3 hours to get the cake stacked and iced- no fondant yet because it is being stupid. 

 

Any advice on pricing would be greatly appreciated, up til now I have just made cakes for fun and for friends/ family birthdays.

Thanks in advance

Shawna

12 replies
AZCouture Posted 24 Apr 2014 , 8:17pm
post #2 of 13

ATwo life size boots with exacting details such as stitching, the holes, laces, heels, etc, probably at least $500 alone. Then forty cupcakes and tiers below the boots? That's a giant order, time wise. Probably at least $800, at least.

Shnaw2006 Posted 24 Apr 2014 , 8:44pm
post #3 of 13

Wow I never knew my time was so valuable :)

As far as tiers I was more thinking about just having 1 square cake with the boots directly on top of that with supports of course. And yes it will be with the stitching, laces, heels and everything to make it look as real as possible. 

 

Just for future knowledge how do you get to the $500 mark? is it mostly time? Materials arent super expensive if you shop around for them. I would just like to know so if other people see this cake and like it I can tell them what I will charge for other stuff.

Thanks a lot

AZCouture Posted 24 Apr 2014 , 8:46pm
post #4 of 13

AOh there's plenty of pricing threads where it's discussed and hashed over every way to Sunday. Just Google them and you'll soon have more information than you know what to do with.

AZCouture Posted 24 Apr 2014 , 8:48pm
post #5 of 13

AAnd I don't know if those figures are appropriate for you or not. You may need to charge more, or less. For what I value my time and expertise at, those are comfortable estimates, but that's for [B]me.[/B] You may have different numbers to work with.

Shnaw2006 Posted 25 Apr 2014 , 4:15am
post #6 of 13

Ok thanks, I will do some searching, I havent used this website very much so I am still feeling my way around

Thanks for the help

madewithloveYG Posted 26 Apr 2014 , 6:28am
post #7 of 13

AHi Shnaw2006, My daughter & I are newbies as well and have been wondering the same question, "what is a good price to charge for cakes and cupcakes".

We just started baking at the beginning of the year, however, what we've made have been given as gifts.

We live in Northern California. If you find some good information on pricing, would you mind sharing?

Thank you and have a Great weekend

Gina

Smckinney07 Posted 26 Apr 2014 , 6:51am
post #8 of 13

AThere's a search bar in the upper right corner, you can just type pricing or look into the business posts for some info, spreadsheets, etc.

Jason Kraft, another CC member, has a great blog you can google JasonKraftBlog.wordpress.com with lots of info. ACakeToRemember.com and CupADeeCakes.Blogspot.com are other CC members with informative blogs, there are many others that I follow but those are the ones I can think of this late.

There's a lot more to pricing then you'd initially consider. If you want to run a business you need to start by calling your local Health Department to see what the rules are, State and County-some states don't allow you to bake from home, if they do you might have a cap on the income you can make, etc. Tax ID, insurance, Food Safety Certifications, I could go on and on.

You need to price your recipes, the costs for ingredients, boxes, cake boards, dowells, advertising, overhead (even baking from home you will still have overhead-electricity, water, etc.) You'll want to see what other bakeries charge in your area-not Walmart but Custom Cake Shops and make sure you're not undercutting but competing. Your time; prep, baking, execution...You need to cover your costs while paying yourself and your daughter (or employees).

Shnaw2006 Posted 27 Apr 2014 , 4:40am
post #9 of 13

Well I have found differing opinions on how to price, especially on the just for fun cakes vs the for a business cake. Im happy to make a short list of the methods I have found. I think I will probably end up kind of combining a couple and figuring out what I am comfortable with. Maybe even on a cake by cake basis

 

Ingredient cost + (hourly wage x hours) +25%= Customer price

Ingredient cost x 4= Customer price

Ingredient cost + 20%= Customer price

Ingredient cost + (hourly wage x hours) = Customer price

Number of servings x $2.50 = Customer price 

Number of servings x $3.50 = Customer price (more for fondant)

And of course- pulling a number out of thin air :)

 

One thing that was mentioned to me is that a bakery will probably be able to get cheaper ingredients since they buy in bulk so a home bakers ingredient cost is likely to be higher than the average bakery

 

I found this article rather helpful coming from Buddy from Cake Boss. Its a good starting point

http://www.cakeboss.com/Cake-Stuff/Articles/How-Much-Should-I-Charge

 

For the pic I posted I will probably charge about $250. Mainly goin off of time it will take to make plus supplies. Its for a friend so I wont charge as much as I maybe could. Im not trying to make a living, Im just having fun :)

howsweet Posted 27 Apr 2014 , 7:30am
post #10 of 13

A

Original message sent by Shnaw2006

Well I have found differing opinions on how to price, especially on the just for fun cakes vs the for a business cake. Im happy to make a short list of the methods I have found. I think I will probably end up kind of combining a couple and figuring out what I am comfortable with. Maybe even on a cake by cake basis

Ingredient cost + (hourly wage x hours) +25%= Customer price [B][COLOR=blue]There is a lot wrong with this[/COLOR][/B] Ingredient cost x 4= Customer price [B][COLOR=blue]There is a lot wrong with this[/COLOR][/B Ingredient cost + 20%= Customer price[B][COLOR=blue] Absurd[/COLOR][/B] Ingredient cost + (hourly wage x hours) = Customer price [B][COLOR=blue]There is a lot wrong with this[/COLOR][/B Number of servings x $2.50 = Customer price [B][COLOR=blue]There is a lot wrong with this[/COLOR][/B Number of servings x $3.50 = Customer price (more for fondant) [B][COLOR=blue]There is a lot wrong with this[/COLOR][/B And of course- pulling a number out of thin air :)

One thing that was mentioned to me is that a bakery will probably be able to get cheaper ingredients since they buy in bulk so a home bakers ingredient cost is likely to be higher than the average bakery.[B][COLOR=blue] But it will take you much longer to complete a cake with your small oven, mixer, etc[/COLOR][/B]

I found this article rather helpful coming from Buddy from Cake Boss. Its a good starting point [B][COLOR=blue]This article has nothing to do with Valastro . It was written by Kelley Masters of Austin, Texas. it's not perfect, but much better than 90% of the info you will find.[/COLOR][/B] [URL=http://www.cakeboss.com/Cake-Stuff/Articles/How-Much-Should-I-Charge]http://www.cakeboss.com/Cake-Stuff/Articles/How-Much-Should-I-Charge[/URL]

For the pic I posted I will probably charge about $250. Mainly goin off of time it will take to make plus supplies. Its for a friend so I wont charge as much as I maybe could. Im not trying to make a living, Im just having fun :)[COLOR=blue] [B]Having fun doesn't mean you shouldn't consider the effects of your actions. Undercharging is a big problem. Just like you would consider it irresponsible to throw your garbage out of your car window on the freeway, it is similarly irresponsible to undercharge for cake. That's for selling to anyone you don't have a personal relationship with starting with a friend of a friend.[/B][/COLOR]

Sorry for the formatting problems, typos and lack of explanation for some of the answers. When I have more time, I'll come back and explain. But basically - just like you do when you buy a house, you do some research to learn the market value of comparable cakes. You have to be careful that you don't use prices of other home bakers who don't know how to charge. Your costs tell you how much your profit is, but not what to charge.

And trust me, when you're selling your cakes for what they're worth, it will put more fun in your hobby. If you sell cakes like the one described for $250, the fun is going to going to be sucked out of it.

Shnaw2006 Posted 27 Apr 2014 , 6:47pm
post #11 of 13

Goodness, I didnt expect that response. I would be very interested to hear why they are bad ideas. I really have nothing to go from. A couple of the ones I listed were actually from bakery owners so I am surprised that you say they are absurd. I realize I can charge more and future cakes I likely will. This is the first cake I have made in probably a year and a half and I dont feel that my skills are up to a huge price tag right now.

howsweet Posted 27 Apr 2014 , 7:27pm
post #12 of 13

A

Original message sent by Shnaw2006

Goodness, I didnt expect that response. I would be very interested to hear why they are bad ideas. I really have nothing to go from. A couple of the ones I listed were actually from bakery owners so I am surprised that you say they are absurd. I realize I can charge more and future cakes I likely will. This is the first cake I have made in probably a year and a half and I dont feel that my skills are up to a huge price tag right now.

Thanks for answering back without flying off the handle. It was very late and worded poorly. :D

Obviously, you don't call and shop prices around every time you plan a cake. So you have to have a way to price each cake without doing that. Therefore there's a difference between what you use internally as a method for pricing and knowing what a cake should sell for. If those were successful bakeries, they were probably internal methods. [I]They've learned that when they use those numbers, that's about the most they can sell a cake for. Does that make sense?[/I]

For example, my internal process starts with $5 per serving and I add on for each piece with the time it will take to add it and the difficulty. If the total doesn't seem like enough, I add a little extra. My method doesn't work as well for smaller two tier cakes, so that's typically when I'm going to be adding in a "random" extra charge.

The reasons even someone just starting out wants to learn what cakes should sell for is: 1) To prevent throwing away money (if you sell a cake for $50 less than it's value, that is throwing away good money) 2) Even if you're giving a cake away or it's for your little one's birthday, don't you just want to know? If you think you've made a cake that's worth $100, but it's really valued at $300, wouldn't you rather know you made a $300 cake so you'd feel even greater about your accomplishment? 3) And when someone comes up to you at the party and says, hey I'm going to be making a cake - you don't want to be caught off guard and quote a price that's too low. Or when you're thinking about gifting a wedding cake, you want to know the value.

And addressing cake quality - in most cases when people start out, their work isn't quite as good, and lesser quality work has less value. But that's not always true and as a matter of fact, most of my first cakes are still on my website. The two cakes in my profile were done in the first 6 months or so. I cringe when I look at the imperfections, but they were decent enough cakes.

MBalaska Posted 27 Apr 2014 , 7:44pm
post #13 of 13
Quote:
Originally Posted by Shnaw2006 
 

"............A couple of the ones I listed were actually from bakery owners so I am surprised that you say they are absurd. ......."

 

Shnaw2006 not everyone will tell the truth! :ouch:  

 

It  sometimes surprising to me  how much money, time, and energy I've spent 'following someone's advice' about baking/decorating  leading me to the eventual conclusion that THEY WERE LYING THROUGH THEIR TEETH.   And publishing it in books that I've purchased.$$$$$ grrrrrrrrrr.

 

Until these gals on cc forum that is....... they have lot's of disagreements, on lot's of different ideas but they are all leading in a successful profitable real life path that has worked for themselves..

That's why reading the forum threads on what ever interests you is so profitable to you.

 

You get the chance to hear the pros & cons, ups & down, inside & out offering you the opportunity to sort out what is practical and applicable to your personal situation. But if the one and only thing that you have taken from this thread is that YOU CAN CHARGE A LOT MORE for your cakes...... then Hurrah;-D

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