Help! I'm a home baker in a rural area. I have heard from a friend that people said I charge too much. I was following social media and am hearing how the other local bakers are booked solid right now! I recently have been getting a couple of their over flow customers seeking someone to make a cake. The customers have told me, "I usually get my cake from ________, but they are booked!" Some of my previous customers who have indicated how happy they were with my cakes, have switched to one of the lower cost bakers and recommend them to others because of low cost and taste good. I haven't received a complaint about my goodies other than cost. Here's the problem: I only charge $1.75/serving. I can't really go any lower!
I love baking and cake decorating! It brings me peace of mind, satisfaction and joy. I lost my only child 1 1/2 yrs. ago and cake decorating has been my peace. I really don't want to give it up. So, I'm wondering what to do to be able to compete when people just go elsewhere for cheaper cakes?
Customers praise me on my work for taste and design. Some say it's better than their mother's homemade goodies. I have tried advertising in the paper, online, given to charity fundraisers and promoted my business in parades. I even took a job at the nearest professional bakery (75 miles each way) just so I could decorate cakes, but I couldn't keep up the drive.
Any suggestions on how to compete with the lower than $1.75/serving?
Samples of my work
this cake was an 8" and a 10" touted, filled, tiered cake. I charged $85 for it.
i just want to say i'm so sorry about the loss of your only child -- and only 18 months ago -- i'm sure you have some sweet memories that are only getting sweeter --
the cool thing about cake decorating is that you can do it anytime -- you don't have to rely on orders from others -- i mean it's not like rebuilding engines where you have to have someone's car to do it -- so there's that where you can do cakes to donate like to emergency rooms for the staff, firehouse, police departments -- you can make arrangements with shelters in your area stuff like that --
then as far as others underpricing that's been a problem in the bakery business for generations and with cottage laws it's even worse now so changing direction might be a good idea for you -- and there's competitions and you could teach too -- consider changing directions and getting by on fewer paid orders --
best to you
I'm so sorry about the loss of your child, I can't even imagine what that must be like to go through.
As far as selling cakes goes, you have a double whammy of being in an area with a lot of undercutters, and living in a rural area. The fact that many of your customers who were happy with your cakes have gone to cheaper people says to me that price is the most important thing in your area. There will be people who tell you to do better marketing, advertise in a different area to different people, but I've lived in enough small towns to know that doesn't always work.
Do you need the money for income as well? If you're selling cakes for $1.75 a serving I don't see how you can be making much money at all, so definitely don't drop your prices. It's a race to the bottom for a lot of people these days as they all bid against each other on facebook to see who can make a cake for the least money, and you don't want to be involved in that.
I, too, am so sorry for your loss. That pain is unimaginable and I am so happy that you have something to give you any bit of peace through that.
Sooo, you should definitely not give that up! $1.75 is super super low and your cake is beautiful. Maybe you need to set yourself apart from the others. Maybe focus on something they don't offer. Do you enjoy making cake/cupcake toppers? You could market to all the cheapies that they can make their own cake and still have a beautiful custom topper.
Do they offer 3d cakes? Out of the box flavors? Organic? Gluten free? Party packages?
You need to figure out what they don't do and offer that. What parts of caking do you really enjoy besides the actual cake? For example, I love making gumpaste/fondant toppers. I can do it in the evening while I listen to the tv and it's relaxing. And, best of all, my competition doesn't offer much of that :)
Give us some more info and I'm sure some of the brilliant minds on here can give you some great ideas.
So sorry for your loss.
Your cake is perfect the price seems so low for that cake. It is a shame you are being undercut. I agree with the previous posters regarding finding a special niche in the market
Wishing you peace.
Thank you all for your caring thoughts. I can't believe some people get $4 or $6 / serving in some locations around country. That would be amazing. Surely some of the other bakers must not be counting some of their costs, like packaging, electricity or paying themselves for their time. I don't see how else they could do it. The more cakes they make and sell, the more word is spread about their cakes. The more popular they become. I can't force people to buy my cakes.
As for the niche, I'm not sure what that would be. I can do most designs that people can think of for me, fondant or buttercream. But so can some of these other bakers. Most people around here don't like fondant so I frost the cake and use fondant accents much of the time. I have all kinds of tools, cake pans, molds, cutters and gizmos. Any ideas on a niche?
Unfortunately, if there are plenty of "cheap cake ladies" who are willing to work for $2 profit, there is not much market left to fill. Even if you prices are "fair" considering the work and ingredients.
Not all areas have porsche dealerships either. So your area/ income may not support the high dollar, high details cakes. It may not work....
Like all the others, so sorry for your loss. I can't even imagine... :(
OMG. So sorry for your loss. Can't even imagine your pain...
If baking is a hobby for you and you don't have/ want to make money out of it...go with the flow and lower your prices.
I was struggling with cheap bakers for a while and decided not to care about other people's prices anymore. I have my own and if someone gets a cake cheaper somewhere else...good for them. Go for it. Saves them money and me the feeling of slaving in the kitchen for nothing.
Yes, it's fun making cakes. But it's also fun making money!
Agree, it's nice to make some money. That's how I pay for my new supplies and classes.
I am sorry for your loss. Perhaps if you offer two styles- Your Gourmet version and one considered affordable by the market standard in your area. Bring them in with the basic cake cost and talk them into an "upgrade" for a few dollars more.
Focus on your versatility and maybe start marketing to the non-traditional customers. You have a quality product and need to keep your integrity. Good luck. You have several options- just choose what fits your style.
I'm kind of trying something like that right now, Kelwat. I have a standard graduation cake for a reasonable price, but so far people want their own design they have picked out. And of course it's usually the big extravagant cakes like on TV that they want for the same price as a basic sheet cake. That is a common problem in lots of areas - wants vs. reality. I fill most of my customers' orders over the Internet or the phone and don't actually meet them in person until they receive their cake. Most of my sales originate through Facebook. This is a non-traditional way of doing business for me, but the customers appreciate it, and it allows me to conduct business (text) while I'm baking. It's funny, since I wrote this question, the last few customers have given me more than what was due on their bill as a tip. So maybe I need to market to a different clientel than those looking for the best bargain.
Thanks all for the thought provoking ideas.
That's a beautiful cake. Def more than $85 in my opinion. I would have charged at least $100. I too am a at home baker and its tough. I tell people if you want cheap go to Walmart or the grocery store but it wont look as good as what I do lol
So you are grieving and being taken advantage of.....that's a crappy feeling. I know this feeling as I too lost someone integral to my life 18 months ago and I also get low balled. There is something so demeaning about baking with resentment over price. That feeling steals your passion....and frankly you can't afford to let anyone take any more pieces of you. I can only Imagine that you have more than enough pieces of you missing right now. Allowing people to undercut you will wittle away at your soul.
For myself, when I lost my someone, it took so much of the feeling that I had any control over my life. It has taken me some time, but I am now at a place where I put my foot down on cake pricing. Saying "no" or demanding more has given me a small piece of control back. And it's hard at first. You will feel like a bad guy. You will lose jobs. But that tiny bit of peace that comes with getting what you are worth....that is so valuable.
I wish you peace on your journey in the after.
you guys are making me cry
that was really sweet
"So maybe I need to market to a different clientele than those looking for the best bargain."
Bingo! You got this, girl! Those cheap cakers clientele are not for you but there are plenty of clients who are, it just takes time to find them.
Consider the difference between "bargain" and "value". Which may require you to educate some people....
A "bargain" hunter wants the biggest for the cheapest. No consideration for quality, detail, etc. Send those people immediately to WalMart, Sam's and Costco for a cake decorated in 10 minutes. That's what they do, and they do it well (most of the time).
A "value" shopper just wants justification for the higher price. I may pay $1 for the McD's burger, and sometimes, that is fine. And sometimes, I want the added avocado, pepperjack cheese, grilled onions, or bacon. I may be willing to pay $8 for that. A cake customer needs that same education of the value your cake presents. "My cake has real fudge filling made with real cream and name brand chocolate", "My icing is made with real butter", "My cake has real fruit filling", etc. Can all shoppers become "value" shopper... no! But some can, and will better appreciate the work you do.
Your "payment" is also emotional therapy, and that too is worth something to you. Not if you feel taken advantage of, but that too has value. I hope you find the best path for you!
Thanks for the insight. I think you're right, just stick with it and let the other go.
I too live in an area like yours its a rural area with not alot of money (it kills me to see what the same cake i made could go for in other areas) and there has been an overflow of cheap bakers who throw the cakes together for next to nothing (i mean through no one even needs to see those pics lol) and they are quote happy with it. In my area Im known as the baker you go to for those cakes no one else can make and it was becoming a problem a couple years ago my customer base dropped at least 25% so I started offering both types of cakes highly detailed, and very basic so i would get customers looking to spend alot and others just looking for a basic cake as low cost as possible. It has worked very well now I am over run with customers usually doing 8-10 cakes a week with most being detailed still but now I get basic ones too so at least im not losing the customers to someone else now. I didnt price them dirt cheap either I still charge more then the other cheapo bakers but at least the price margin is closer now so with my skill level they are willing to spend a bit more and purchase from me even when they are looking for a deal. I also have offered deals in the past such as book your orders this week for any date in the coming year and receive 20% off your order, its a small amount that they actually receive off but typically I have found it gets new people coming to me and people book cakes they wouldnt have even ordered just cause they cant resist a deal. Ive also done, book a $40 cake and get 1 dozen swirl cupcakes free or book a $60 cake and get 2 dozen cupcakes free. The cupcakes take no time to make they are simple and they feel as though they got an amazing deal. I just completed that promotion and gained probably 12 new clients that have said they are coming back for their next orders, these are all people who wouldnt have tried me otherwise they would have continued going to their low cost bakers. Good luck I hope it works out for you and you can continue to do what you love.
Some good ideas baker 101 and ideas others have suggested. I will try some of these and see what happens. Thanks all.