Pricing, Pricing, Pricing!

Business By ejonesy13 Updated 23 Apr 2015 , 8:30pm by ejonesy13

ejonesy13 Posted 25 Mar 2015 , 7:01am
post #1 of 24

I'm a hobby baker turned pro and I'm ready to rip my hair out over pricing. I know most people say that you should charge 4-5.00 per serving for a fondant covered cake. That works out pretty good for the most part if it is a basic 8", 9", 10" etc... How in the world, though, is one supposed to price things like cakes that are carved or 8" tall or something with unique details? I recently used the 4.00 per serving to price a cake and I DID charge them for the extra details (flowers, teacup, handle etc...) I worked for 10+ hours and only made $30. I am sick about it. Could you wonderful people please help me figure this out and tell me approximately how much you would charge for a cake that has 25 servings and looks like this so that I might have a better idea of what these types of things should be priced at: https://www.facebook.com/181237215247083/photos/a.299589183411885.62380.181237215247083/821729044531227/?type=1&theater

Also, what is an appropriate per hour rate for what we do?

I just have so much to learn. Thank you in advance for your help.

23 replies
ejonesy13 Posted 25 Mar 2015 , 7:02am
post #2 of 24

P.S. Yes the teapot and table are both made of cake.

-K8memphis Posted 25 Mar 2015 , 11:43am
post #3 of 24

Sure you need to price higher but more importantly you need to work faster and more efficiently -- this of course takes time to develop -- but so many of us get discouraged by pricing well then it taking so long to accomplish that there go all the profits down the clocks throat and not in our pocket --

 besides baking, making icing and covering the cakes w/fondant which would all be covered under your base price i can't see that cake taking much more than an hour to complete -- 2 hours max to assemble, pre-make the flowers, teapot top, handle, spout, sculpt the pot, the tablecloth effect on the table is easier/faster than smoothing fondant --

 another issue is the few servings -- you're taking the same amount of time to do those 25 servings as you would to do 50 so you need to consider a minimum price and probably calculated around the 50 serving mark would be good to start -- so no matter how small the order they pay the minimum of at least $200 for a sculpture -- but you gotta get faster too -- at least allow for your learning curve know what i mean?

julia1812 Posted 25 Mar 2015 , 11:53am
post #4 of 24

Yes to what k8 said!

 I'm a hobby baker and currently charge costs plus my work hours. Of course it's sometimes difficult to know how long something will take, but that's what k8 mentioned before too...it's a learning curve!

costumeczar Posted 25 Mar 2015 , 4:28pm
post #5 of 24

Sculpted cakes shouldn't be priced by the serving, because the cake ingredients are the least of your worries for those. I have a minimum order for 3-D cakes, which would include anything that has an item that I have to take a knife to in order to shape. I think it's $200, but I could be wrong, but it's around there somewhere. Usually people end up paying more for a 3-D cake than the minimum because I say the minimum would serve about 20, anything smaller than that would be too dinky. So that would mean that the minimum order would be $10 a serving. I probably wouldn't charge that much for a cake that served more people, the price per serving would go down if you worked it out that way, but that's the starting point. Anything less than that time-wise isn't worth it to me.

For pricing in general, you should have three basic categories: Buttercream, fondant and shaped cakes. Whether you charge more for different flavors etc is up to you, but those three categories should always be considered separately. 

I had someone recently email me to ask for a cake shaped like a palace for 100 people. I told her it would be  $600-800 depending on exactly what she wanted. I was thinking okay, a palace, turrets, pretty square so not a lot of shaping, etc. She wrote back and with each email got more specific until she finally sent me a photo of an actual palace in India with all the minarets, gold facades, balconies, etc. She said that she didn't need it to be super detailed, but I told her that even without the detail it was going to be at least $1000 if she wanted me to copy an actual building. Then she asked if I could make it out of cupcakes. The answer was no.

Pastrybaglady Posted 25 Mar 2015 , 4:34pm
post #6 of 24

A palace? Out of cupcakes?  Now that's a good one!

ejonesy13 Posted 25 Mar 2015 , 5:09pm
post #7 of 24

So you are saying you can do a teapot cake like that in 3 hours -K8memphis!?! The cake, fondant covering, flowers, lid, handle, spout, teacup and carving...everything in only 3 hours!?!

Quote by @-K8memphis on 5 hours ago

Sure you need to price higher but more importantly you need to work faster and more efficiently -- this of course takes time to develop -- but so many of us get discouraged by pricing well then it taking so long to accomplish that there go all the profits down the clocks throat and not in our pocket --

 besides baking, making icing and covering the cakes w/fondant which would all be covered under your base price i can't see that cake taking much more than an hour to complete -- 2 hours max to assemble, pre-make the flowers, teapot top, handle, spout, sculpt the pot, the tablecloth effect on the table is easier/faster than smoothing fondant --

 another issue is the few servings -- you're taking the same amount of time to do those 25 servings as you would to do 50 so you need to consider a minimum price and probably calculated around the 50 serving mark would be good to start -- so no matter how small the order they pay the minimum of at least $200 for a sculpture -- but you gotta get faster too -- at least allow for your learning curve know what i mean?


-K8memphis Posted 25 Mar 2015 , 5:25pm
post #8 of 24


Quote by @-K8memphis on 5 hours ago

 besides baking, making icing and covering the cakes w/fondant which would all be covered under your base price i can't see that cake taking much more than an hour to complete -- 2 hours max to assemble, pre-make the flowers, teapot top, handle, spout, sculpt the pot, the tablecloth effect on the table is easier/faster than smoothing fondant --


no i said after fondanting it i said i could add up the sculpting time and making of the yellow flowers lid, handle and spout and applying such in an hour -- 

didja make the blue flowers?

which is why when people suggest to add in an hourly rate i cringe for them because they will price themselves out of the market -- it takes some speed to succeed --

i've been at it over 40 years and i've worked in many bakeries where you had to hustle or get shown the door --


julia1812 Posted 25 Mar 2015 , 5:43pm
post #9 of 24

 

Quote by @costumeczar on 1 hour ago

Sculpted cakes shouldn't be priced by the serving, because the cake ingredients are the least of your worries for those. I have a minimum order for 3-D cakes, which would include anything that has an item that I have to take a knife to in order to shape. I think it's $200, but I could be wrong, but it's around there somewhere. Usually people end up paying more for a 3-D cake than the minimum because I say the minimum would serve about 20, anything smaller than that would be too dinky. So that would mean that the minimum order would be $10 a serving. I probably wouldn't charge that much for a cake that served more people, the price per serving would go down if you worked it out that way, but that's the starting point. Anything less than that time-wise isn't worth it to me.

For pricing in general, you should have three basic categories: Buttercream, fondant and shaped cakes. Whether you charge more for different flavors etc is up to you, but those three categories should always be considered separately. 

 

 Well, I see that differently. It depends what you do. Some cakes take me less time to carve than other "not carved" ones. For example the last carved cake I made was a lion cake. It took me less than 2 hours of icing, carving, fondanting, piping and it was feeding 50 people. I did another cake, very small, for I think 15 people, which was an I phone cake. The phone was edible and every little detail was hand painted. I spend way more time on that one!

-K8memphis Posted 25 Mar 2015 , 6:17pm
post #10 of 24

ejonesy --you asked a great question -- this is the missing link in many to most home bakers repertoire --  for example one way to cut corners is to use pre-colored fondant so that time to mix colors is nil or shorter -- also think of this -- the next time you do a teapot it's gonna go a lot faster -- 

it's tough for even the above average solo caker to build up speed -- there was a discussion on here once about a 14 hour pirate ship cake -- while i'm sure it was awesome a brick and mortar bake shop can't afford to pay one person nearly two days wages to do one cake -- see what i mean -- this work is rated by the hour so home cakers can operate this way because they aren't paying themselves but they often burn out because it never becomes profitable and uses them all up in the meantime --

so it's important and good that you asked



costumeczar Posted 25 Mar 2015 , 6:55pm
post #11 of 24

 

Quote by @julia1812 on 1 hour ago

 

Quote by @costumeczar on 1 hour ago

Sculpted cakes shouldn't be priced by the serving, because the cake ingredients are the least of your worries for those. I have a minimum order for 3-D cakes, which would include anything that has an item that I have to take a knife to in order to shape. I think it's $200, but I could be wrong, but it's around there somewhere. Usually people end up paying more for a 3-D cake than the minimum because I say the minimum would serve about 20, anything smaller than that would be too dinky. So that would mean that the minimum order would be $10 a serving. I probably wouldn't charge that much for a cake that served more people, the price per serving would go down if you worked it out that way, but that's the starting point. Anything less than that time-wise isn't worth it to me.

For pricing in general, you should have three basic categories: Buttercream, fondant and shaped cakes. Whether you charge more for different flavors etc is up to you, but those three categories should always be considered separately. 

 

 Well, I see that differently. It depends what you do. Some cakes take me less time to carve than other "not carved" ones. For example the last carved cake I made was a lion cake. It took me less than 2 hours of icing, carving, fondanting, piping and it was feeding 50 people. I did another cake, very small, for I think 15 people, which was an I phone cake. The phone was edible and every little detail was hand painted. I spend way more time on that one!

 Nah, I think we're probably on the same page, it's just semantics. When I say 3-D or shaped cakes I'm throwing in carved or anything made to look like something. So even if it's a rectangular iphone I'd be putting that in the 3-D minimum category because of the detail work. Basically, if someone says "I want a cake that looks like..." it goes in the 3-D category.

costumeczar Posted 25 Mar 2015 , 6:56pm
post #12 of 24

 

Quote by @Pastrybaglady on 2 hours ago

A palace? Out of cupcakes?  Now that's a good one!

 Yeah...That's what I thought too ;)

ejonesy13 Posted 25 Mar 2015 , 7:26pm
post #13 of 24

Oh sorry that I miss understood -K8memphis. That makes much more sense. Yes, I made everything that is part of cake by hand. If you are talking about the blue flowers behind it, no. Those were just for the picture so the cake didn't blend into the background quite so much. :) I know that I'm slower and will get faster with practice, but regardless of that; I would imagine that someone making this cake should get more than $30 profit from it. 

-K8memphis Posted 25 Mar 2015 , 8:07pm
post #14 of 24

sure you should -- do it -- charge more -- get faster*  -- bam

i too consider everything that doesn't look like a cake when it goes in the box a sculpture whether it's a rectangular sewing/jewelry or tool box so kaching show me the money --

i do have a different minimum for 2-d and 3-d sculptures though -- a box with an open lid is a 3-d -- basically an 8x12 rectangle with a propped open lid is a 3-d sculpture -- a giant 2-d strawberry, scooter, party bus that's just laying there flat on the board costs less & has a different minimum --

*one of the biggies that hinder at-home peeps is how the left and right sides of our brains work -- in the creative mode on the one side or the other (i can never remember which) -- there is no consciousness of time which is why it can easily take someone 14 hours to complete a pirate ship -- we literally get lost in time -- so an idea is to create a list of all the steps doing a cake and how much time you want each one to take -- set a timer and see how it goes -- or just record how long each one does take and do it in less time next time -- 

there's more on it here : http://www.amazon.com/dp/0874774195/?tag=cakecentral-20



julia1812 Posted 26 Mar 2015 , 6:33am
post #15 of 24

 Nah, I think we're probably on the same page, it's just semantics. When I say 3-D or shaped cakes I'm throwing in carved or anything made to look like something. So even if it's a rectangular iphone I'd be putting that in the 3-D minimum category because of the detail work. Basically, if someone says "I want a cake that looks like..." it goes in the 3-D category.

 

 

ejonesy13 Posted 18 Apr 2015 , 7:38am
post #16 of 24

I think I might have to get out of the cake game. If I charge enough to make what I feel is a fair amount of money; no one hires me. If I charge less I get tons of clients, but then I make $20 for 5+ hours of work. It's not like I'm slow at making cakes or anything either. I haven't heard one good explanation of how to price cakes that works and makes sense. This sucks. 

CakePrincessPE Posted 18 Apr 2015 , 9:11am
post #17 of 24


Quote by @costumeczar on 25 Mar 2015 , 11:56am

 

Quote by @Pastrybaglady on 2 hours ago

A palace? Out of cupcakes?  Now that's a good one!

 Yeah...That's what I thought too ;)

ROFL....

GimmiemoreCake Posted 18 Apr 2015 , 10:19am
post #18 of 24

I find this a tough topic too. Customers have no idea how much a wedding cake or custom cake costs or takes to make. My friend and I are hobby bakers. We make very nice cakes (not pro), but pretty darn nice. We under price for sure and still get people complaining or "looks of shock". Our "system" for pricing usually yields us $100 profit for wedding cakes (if that), and $25 or $30 for birthday cakes or other fancy cakes. 

I have this order to do this week:

- Two tiers each 3 inches tall (2 or 3 layers depending on thickness of each layer).
- Deep chocolate cake with chocolate buttercream and baileys filling. 
- Bottom tier 10 inch round, Top tier 6 inch round
- Bottom tier covered in purple fondant with fondant elephant molds and various accents in lime green.
- Top tier covered in vanilla buttercream coloured various shades of purple. Large star flower piped design.
- Purchased elephant apparel scattered on cake
 
- I think some gum paste lime and/or purple briar roses would look nice. I will add them (for free) if approved 
 
Fondant = $10.00
Baileys = $5.00
Cake Batter = $12.00 - $18.00 (I am leaning towards 18 because it may take 3 batches of cake)
Icing = $10.00 - $15.00 depending on top tier requirements
 
Hard physical labour and creative input = $25.00
 
So, that's $37.00 to $48.00 + $25.00
 

It's a friend so I charged her only the cost of ingredients and $25.00 for my time! But, I'm curious how much you all would charge. 


Apti Posted 18 Apr 2015 , 11:05am
post #19 of 24


Quote by @ejonesy13 on 2 hours ago

I think I might have to get out of the cake game. If I charge enough to make what I feel is a fair amount of money; no one hires me. If I charge less I get tons of clients, but then I make $20 for 5+ hours of work. It's not like I'm slow at making cakes or anything either. I haven't heard one good explanation of how to price cakes that works and makes sense. This sucks. 

ejonesy13~~The explanation that "works" is the explanation that no one doing cakes wants to hear:  Custom cakes may not be a viable business enterprise for you, the custom baker, for a multitude of reasons which have nothing to do with actual cake. 

Let's imagine you have a passion and talent for birdhouses.  These are not your regular birdhouses, oh no sir-ee!  These birdhouses can be made to match a specific home design and color scheme.  Neighbors and strangers and family members will "oooh! and aaaah" when they see YOUR birdhouse!  These birdhouses actually attract birds who nest in them year after year.  These birdhouses have a mini-camera installed so you can see the entire nesting process from the laying of the eggs to the fledging of the little birds as they leave the nest.   

But wait!  There's more!  Before I start working on your birdhouse, I will do a 30-60 minute consultation and do some preliminary drawings, this may take some back and forth on the computer or telephone to get your birdhouse, "just right"!  After the consultation, I will obtain an 50% non-refundable deposit, set a completion date, and obtain the remainder due one month before delivery.  I will come to YOUR home to set up the birdhouse (with camera) in your yard and make sure the camera image is compatible for your computer.  

Birdhouse pricing:  $200 minimum per birdhouse that will accommodate one bird and one small nest.  Tiny, real glass windows additional charge, depending on the complexity and number of windows.  Miniature furniture, additional charge.  Stucco instead of paint, additional charge.  Upgraded camera with night vision, additional charge.  Compacted or rocky soil at site of installation, additional charge.

Note:  The average price of the birdhouses shown in the photo gallery on the website is approximately $800. 

Moral of this story:  Just because you have a passion and talent for birdhouses, does not mean that you have a profitable market for your birdhouses.

Pricing articles/videos:  "Secrets to a Successful Cake Business with Jay Qualls", CakeFu Master Series:  http://www.cakefu.com/masters-series/jay-qualls-116/

"How much should I charge for my cakes?"  http://www.cakeboss.com/Cake-Stuff/Articles/How-Much-Should-I-Charge 

How'd You Arrive at that Number?    http://staceyssweetshop.blogspot.com/2011/08/howd-you-arrive-at-that-number.html 

Home Baking for Profit, by Mimi Fix:  http://www.amazon.com/Home-Baking-Profit-Mimi-Shotland/dp/1453801405 

"A Buyer's Market will Crush Your Fabulous Ad Campaign", Kara Buntin, aka:  costumeczar   http://www.acaketorememberva.blogspot.com/2015/04/a-buyers-market-will-crush-your.html

Apti Posted 18 Apr 2015 , 5:23pm
post #20 of 24


In the words attributed to Ruth Rickey, when determining how far to take a design, think of the customer and ask yourself:


1. Will they notice?
2. If they notice, will they care?
3. If they care, will they pay?

-K8memphis Posted 18 Apr 2015 , 5:38pm
post #21 of 24


Quote by @Apti on 1 minute ago


In the words attributed to Ruth Rickey, when determining how far to take a design, think of the customer and ask yourself:


1. Will they notice?
2. If they notice, will they care?
3. If they care, will they pay?


brilliant -- perfect, apti -- so many of us spend hours and hours especially some pros on here to make things "perfect" and they don't apply this to the detriment of their health, pocketbook and not only their own nervous system but other's as well -- has to be kerry vincent competition worthy -- no it doesn't that's seriously ridiculous -- those women craft those out over months and months --

98.9% of cake clients have agendas that just don't include going over a cake with a magnifying glass -- they're having a party and want to have a sweet fresh treat that's been to the point, beautiful and fragrant all night long -- 

(not directed to op -- just in general) some of us need to get over ourselves

Apti Posted 18 Apr 2015 , 11:34pm
post #22 of 24

The home-baker:   "I want to make cute stuff and sell it to make some extra money!"   

The business person home-baker:   "I want to be efficient, profitable, use the minimal time and expense to create a product that is "good enough" to generate further orders and make some extra money! "

EJonesy13: “I recently used the 4.00 per serving to price a cake and I DID charge them for the extra details (flowers, teacup, handle etc...) I worked for 10+ hours and only made $30. [$3 an hour] I am sick about it. Could you wonderful people please help me figure this out and tell me approximately how much you would charge for a cake that has 25 servings and looks like this [teacup cake]? [Using costumeczar's minimum of $200 for carved cakes, the cake would have been priced at $8 per serving.]

Quote from KelleyM of CC on this 2012 thread: www.cakecentral.com/forum/t/748799/cake-prices#gcsM6PYWbu26FAvt.99re at http://


...It's time for some tough love. You call this a business, but you're not running it like a business, you're running it like your personal cake charity....
It is entirely possible that there is not a market for high end sculpted cakes where you are. You may be targeting the wrong customers. You may be happier if you decide to stop "selling" cakes, and focus on the joy that giving a cake as a gift can bring you, because your "business" is certainly not bringing you joy, and it's not bringing you any money if you really make less than $2-$3/hour. ...As Indydebi says, the proper attitude is "Who cares? Who's next?"

1. Will they notice?
2. If they notice, will they care?
3. If they care, will they pay?
Read more at http://www.cakecentral.com/forum/t/784507/pricing-pricing-pricing#post_7593505#th4g1ruIEvp8O97P.99

ejonesy13 Posted 23 Apr 2015 , 8:23pm
post #23 of 24

You're right Apti, Thank you.

ejonesy13 Posted 23 Apr 2015 , 8:30pm
post #24 of 24

Unfortunately, I don't have much passion making cakes either. I'm just trying to use my current talents to try and make some money. I need to work out of my house because I have a little one and if I don't make at least a couple of hundred a month we have to put groceries on credit. So, I might just have to find something else to do if I can't get myself to have the"Who cares? Who's next?"  attitude I really do appreciate your tough love :)

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