Need Pricing

Business By blondensmart Updated 28 Apr 2014 , 4:53pm by howsweet

blondensmart Posted 28 Apr 2014 , 2:35am
post #1 of 19

I have just started doing cakes. I'm pretty good at making them, but i have no idea how to price

them. How much would you charge for this cake?

 

x*

18 replies
blondensmart Posted 28 Apr 2014 , 4:55am
post #2 of 19

I know y'all probably can't give me an exact price, but I just need a ballpark figure, so I don't over charge or undercharge. I was thinking $150-$200....

howsweet Posted 28 Apr 2014 , 6:22am
post #3 of 19

AHere's one issue. If you don't know that in order for anyone to tell you what they would charge, you have to tell them what size the cakes will be, it's a huge red flag that you may not be ready to go into business.

Claire138 Posted 28 Apr 2014 , 6:27am
post #4 of 19

Quote:

Originally Posted by howsweet 

Here's one issue. If you don't know that in order for anyone to tell you what they would charge, you have to tell them what size the cakes will be, it's a huge red flag that you may not be ready to go into business.

 

Yep.

I'll also add that there are hundreds of threads on this topic, a quick search on google or at the top right hand corner of the CC home page under the search button will lead you right to all the threads on this subject where you could hopefully find help.

howsweet Posted 28 Apr 2014 , 6:46am
post #5 of 19

AAnd lots of bad info. Be careful about that. Most pricing advice focuses on costs and your costs really don't give you much info about the value of cake. And I know my post was a little harsh. I years ago I undercharged for a few cakes when I first started and I can tell you that after a few times, I shook my fist at the sky and said as God is my witness, I'll never undervalue myself again (that will sound crazy if you haven't seen Gone With the Wind). I still didn't know what to charge, but I was determined to find out and not charge a penny less.

However, not everyone out there is so inclined and some routinely charge way too little.

FWIW, I don't know how many servings are involved, but I'd not be quoting anywhere near the numbers you mentioned. You're way too low.

blondensmart Posted 28 Apr 2014 , 9:01am
post #6 of 19

AI appreciate your candid responses. You're probably right that I'm not "ready" to go into business. Nonetheless, I am in a position where I must continue and probably learn some hard lessons along the way. I do have the sizes worked out based on serving guides that I've found online. The cakes sizes would be 12"x8", 8"x6' and 6"x4". As for the other response, I have searched for prices that are online; however, I've only found pricing estimates from actual bakeries. Since I'm staring out, I don't feel I can price my cakes as high as what a bakery would. The only thing I really have going for me is being a perfectionist. When I get a picture of a cake, the end result will be nearly spot on with the picture. My frustration is this: I"ve priced cakes using the following "price structure": buttercream $1.50 a serving, fondant $2.00 a serving and 3D Fondant $2.50 a serving, and people don't want to pay those prices. I've had many cancellations, so I've started charging 1/2 down to get on the calendar. So far, I've had 2 cake orders, one of which was a wedding cake for my church that I lost money on. I know I'm not experienced enough to be going into business. However, financial necessity demands that I do so in spite of my lack of knowledge in the pricing arena. I appreciate your honesty and hope that I will learn quickly enough that y'all won't feel like ringing my neck. :D Any additional advice people have would be greatly appreciated.

MimiFix Posted 28 Apr 2014 , 12:02pm
post #7 of 19
Quote:
Originally Posted by blondensmart 
I know I'm not experienced enough to be going into business. However, financial necessity demands that I do so in spite of my lack of knowledge in the pricing arena.  

 

If financial necessity is your prime motivation for selling cakes, you would make more money working a minimum wage job. As a bonus you would avoid all the aggravation involved. And not be losing money as you stated.

Natka81 Posted 28 Apr 2014 , 12:17pm
post #8 of 19

Hi, there I am new to cake decorating too. If you are thinking 150- 200 its probably worth more that, that is a fancy cake. I would charge not less than $ 200.00 for sure.  

I am a bookkeeper for my husbands business and from all the money we have coming in from our customers, what we have left for our family net income is only 35% .

 

If you want to make living out of cake decorating business think of it this way:

If you charge for this cake $ 200.00 devide it by 3, so only:

70.00 is your to spend on living

70.00 you will spend on cake supplies for this cake,  insurance, ( example : 550.00 yearly, devided by how many cakes you bake for 1 year.) including: 5% - 10% of your electricity bill, phone bill, water bill, fuel or milage.

60.00 you can`t spend this money, you have to keep on your account for future development of your business.

You HAVE to do this calculations for every cake you make.

How many hour you will spend on this $  200.00 cake? Include time: going to store to buy supplies, mixing batter, clean up twice ( after baking cake and after decorating cake if you do it in 2 days), filling cake, decorating cake. 

        I have been a member here for so little but I have read many post on pricing. Then I decided to do my "homework" on pricing. After that I have changed all my prices.

   My friends can not afford my cakes, so what? I will find my customers. You will too, but please don`t feel sorry and drop your prices for people who can not afford your cakes. 

-K8memphis Posted 28 Apr 2014 , 2:19pm
post #9 of 19

to me, the rock bottom lowest price point for a fondant cake like that with hand modeled features is $4 to $5 per serving to be within the realm of respectability -- think of it this way--yes every one wants a cake but those who cannot even afford your original prices are not your client base for that level of work--

 

i understand the money thing but the pricing you have mentioned will not make you any--

 

baking and selling bundt cakes, cookies and brownies is where you can exchange time and ingredients for some money, 'rote' money -- when you add in the high end decor then you're in a different league where you have to be more diligent to draw the net on that type of haute (monied) clientelle than you are in decorating the cakes or you are wasting your time--if you must bake, bake & sell brownies instead --

 

best to you 

blondensmart Posted 28 Apr 2014 , 2:36pm
post #10 of 19

Thank each of you so much! Your comments have really helped - even the ones that are negative. To clarify - I am not able to work a job. I was thrown out of a car and have severe chronic pain. I worked for 20 years until it became too much. Decorating cakes allows me to work when I feel well and rest when I don't. Plus, a lot of the detail work I can do sitting in my recliner. I really appreciate the comment on how to divide the money from a sale. That is excellent advice and will be put into use immediately! And, you have restored my faith in my pricing. I will stick to my guns and continue pricing my cakes for what they're worth instead of lowering my prices where everyone can afford a highly detailed cake. Thank you guys!

-K8memphis Posted 28 Apr 2014 , 2:59pm
post #11 of 19
Quote:
Originally Posted by -K8memphis 
 

to me, the rock bottom lowest price point for a fondant cake like that with hand modeled features is $4 to $5 per serving to be within the realm of respectability -- think of it this way--yes every one wants a cake but those who cannot even afford your original prices are not your client base for that level of work--

 

i understand the money thing but the pricing you have mentioned will not make you any--

 

baking and selling bundt cakes, cookies and brownies is where you can exchange time and ingredients for some money, 'rote' money -- when you add in the high end decor then you're in a different league where you have to be more diligent to draw the net on that type of haute (monied) clientelle than you are in decorating the cakes or you are wasting your time--if you must bake, bake & sell brownies instead --

 

best to you 

 

 

wait--i shoulda said  you have to be more diligent to draw the net on that type of haute (monied) clientelle than you are in decorating the cakes or you risk wasting your time--if you must bake for your current clientelle, bake & sell brownies and bundt cakes instead -- 

 

and i understand the can't work thing--the can't work like you usedta could work thing ;) 

 

i didn't intend to be negative if i was--it's just kind of a black & white thing--the lady or the tiger -- dollars or pennies -- hey another idea is if you make gum paste flowers and lace pieces and sold those--that way you avoid the crush of the pinpoint brickwall deadlines that celebration cakes have -- just get up a stock and see how that goes maybe--just a thought

 

best baking and all to you

Gingerlocks Posted 28 Apr 2014 , 3:35pm
post #12 of 19
Quote:
Originally Posted by blondensmart 
 My frustration is this: I"ve priced cakes using the following "price structure": butter cream $1.50 a serving, fondant $2.00 a serving and 3D Fondant $2.50 a serving, and people don't want to pay those prices. I've had many cancellations, so I've started charging 1/2 down to get on the calendar. So far, I've had 2 cake orders, one of which was a wedding cake for my church that I lost money on. I know I'm not experienced enough to be going into business.

People complain with those prices! Your pricing is very low (I would charge 3x to 4x that much). There is the possibility that by charging so low you are appealing to the "wrong" crowd..or the kind of people who can only really afford Costco cakes (not that there is anything wrong with that..but they are ultra price conscience, and custom cakes are probably out of their price range). By upping your pricing you might actually attract more customers..just a thought though.

 

And as for these last minute cancelers..you need to be taking a deposit upfront; a non-refundable deposit. So that even if they back out last minute you are not loosing the money you've already put into the cake. 

howsweet Posted 28 Apr 2014 , 4:05pm
post #13 of 19

AYou can divide up the money any way you want, but how does that help you know what to charge? You have to learn what cakes sell for because there are places where people undercharging have ruined the cake market to the extent that you can't make any money in the cake business. If you live in a big city, most likely you're ok, but if you live in a small town of three or four hundred thousand, there could be a problem.

You can't find out prices by looking at websites. You have to get some actual quotes.

blondensmart Posted 28 Apr 2014 , 4:16pm
post #14 of 19

A[quote name="howsweet" url="/t/774126/need-pricing#post_7508797"] If you live in a big city, most likely you're ok, but if you live in a small town of three or four hundred thousand, there could be a problem.

You can't find out prices by looking at websites. You have to get some actual quotes.

That is the funniest post I've seen! No disrespect intended. You just helped figure out my problem. I live in a small town of 4 thousand - not 4 hundred thousand. It's mind-boggling to me that you consider 4 hundred thousand a small town! :D Seriously though. That could sincerely be my problem....the small town mentality.

Natka81 Posted 28 Apr 2014 , 4:20pm
post #15 of 19

Howsweet I totally, agree with you. I live in a small town where nobody cake about pretty looking fondant cakes or gumpaste decorations. All I do for my customers is decorate each cake different from other depending who this cake is for. As for Blondesmart my post was just a example  of what its going to look like in the end. Of course she needs to do the math herself.

 

Sorry.

-K8memphis Posted 28 Apr 2014 , 4:24pm
post #16 of 19

well there's the small town mentality and the small town reality too--if you are near enough to a big city you can do this--if you are in the biggest city around start whipping out the bundt pans--or you can certainly mail order out the flowers & decor & stuff too--there's always a way--

howsweet Posted 28 Apr 2014 , 4:39pm
post #17 of 19

A[COLOR=blue]The cakes sizes would be 12"x8", 8"x6' and 6"x4 [/COLOR]

Ok, those shapes would not be similar to the cakes in the picture. and what you describe would be 130 servings. Two of these would be two tier cakes, internally,, sort of like barrel cakes. Do you want it to be that big? That doesn't include any servings in the 3d pieces.

If you make it a 10 in, four layer with a 7 inch, 3 layer and a 5 in, 2 layer, it would serve about 46 (because some of the 7 in is cut off) Base price is $230 Extra layers on top of 3 cakes $24 Stars with cut out letters x 5 is $4 Very simple trees, $8 (some can't be seen from picture angle) RKT shoe $20 3d red thing with windows made using a bowl for a cake pan $35 Plus windows $5 more Black head with two ears made from foam balls $35 RKT hand $38 Big number one $2 tube thing $15 micky park entrance thing $35 black heads on micky park thing $10 "Grass" trim on big cake $3 Stone path $6 Custom base $20

Total $490. That doesn't include the toy figures which might ad $20 or more.

howsweet Posted 28 Apr 2014 , 4:42pm
post #18 of 19

A

Original message sent by Natka81

Howsweet I totally, agree with you. I live in a small town where nobody cake about pretty looking fondant cakes or gumpaste decorations. All I do for my customers is decorate each cake different from other depending who this cake is for. As for Blondesmart my post was just a example  of what its going to look like in the end. Of course she needs to do the math herself.

Sorry.

That wasn't an attack on you - it was just to point out that it's not how to set price. I don't think you were suggesting it was. :D

howsweet Posted 28 Apr 2014 , 4:53pm
post #19 of 19

A[QUOTE]That is the funniest post I've seen! No disrespect intended. You just helped figure out my problem. I live in a small town of 4 thousand - not 4 hundred thousand. It's mind-boggling to me that you consider 4 hundred thousand a small town! icon_biggrin.gif Seriously though. That could sincerely be my problem....the small town mentality.[/QUOTE] Lol - it's all relative, isn't it? Unless you're near a bigger town, it's unlikely a town that size could support a high end custom cake business. I'm really sorry to say that. Just like you don't have a Lamborghini dealership, this similarly isn't going to be possible. But like K8 said, you can be creative and find a niche.

Quote by @%username% on %date%

%body%