Am I Overcharging!?

Business By toriannlynn Updated 4 Jun 2015 , 1:28pm by SquirrellyCakes

toriannlynn Posted 26 May 2015 , 2:32am
post #1 of 34

So I'm new on here and in the cake business! I have posted a few posts and have got some helpful feedback! I'm so happy to be apart of this site and I love making cakes. I have been reaching out to people asking for cakes on facebook bc right now that's the best place for me to find new clients but when messaging them I tell them my prices and never hear back from them! I am right around $3 a serving and I feel like people expect to find their three tiered dream on Pinterest and buy it for $20 bucks but that's just not realistic! Being a baker is my dream and I want to succeed so bad! 

33 replies
Gingerlocks Posted 26 May 2015 , 2:58am
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No, you are not overcharging by any means..you probably are even undercharging. Unfortunately though, there are a million cheap cake ladies and people are too used to rock bottom priced cakes...particularly if you seek customers on those Facebook buy and sell sites; those people are bargain hunters and are absolutely not your customers. 

SweetShop5 Posted 26 May 2015 , 3:17am
post #3 of 34

You're not undercharging. There's just a lot of people out there looking to get a cake made for a cheap price. I sometimes get no replies from people once I tell them our prices as well. 

julia1812 Posted 26 May 2015 , 4:39am
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Stupid question: Are people really ordering wedding cakes on Facebook these days???

And probably the wedding dress on ebay used items?

Lol! 

Look somewhere else for clientèle is my advise. Unless you wanna deal with bargain hunters...


toriannlynn Posted 26 May 2015 , 12:52pm
post #5 of 34

Thank you both so much! Do you have any suggestions on how to build my clientele? I reserved a booth for a local craft show in July but right now that's about it. 
I live in a small town about 45 mins away from Columbus Ohio. I would love to get people in Columbus to order from me and I would deliver I just don't know how to reach out to them. 

toriannlynn Posted 26 May 2015 , 12:52pm
post #6 of 34

Thank you both so much! Do you have any suggestions on how to build my clientele? I reserved a booth for a local craft show in July but right now that's about it. 
I live in a small town about 45 mins away from Columbus Ohio. I would love to get people in Columbus to order from me and I would deliver I just don't know how to reach out to them. 

toriannlynn Posted 26 May 2015 , 2:20pm
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And Julia yes they are! I think its ridiculous also. It must just be the area I live in. 

SquirrellyCakes Posted 26 May 2015 , 2:26pm
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Not just where you live, it is also the case here in Ottawa, Canada.  

SquirrellyCakes Posted 26 May 2015 , 2:29pm
post #9 of 34

Are there any wedding shows in your area? Here we have them seasonally.



toriannlynn Posted 26 May 2015 , 4:43pm
post #10 of 34

Hmmm I don't know about wedding shows squirrellycakes I'm still pretty new at this but sounds worth looking into! Thank you so much 

toriannlynn Posted 26 May 2015 , 6:22pm
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There are bridal shows around where I live in the bigger cities although they are $600-$2500 for a booth I would love to do them someday but right now they are just too expensive. 

SweetShop5 Posted 26 May 2015 , 9:30pm
post #12 of 34


Quote by @SquirrellyCakes on 7 hours ago

Not just where you live, it is also the case here in Ottawa, Canada.  

Off topic, but I didn't know you were from Ottawa :) Its good to see someone on Cake Central from the same city as me!

SquirrellyCakes Posted 26 May 2015 , 9:56pm
post #13 of 34

Off topic here too, I didn't realize you were an Ottawan too, SweetShop5.  I think there are a couple of other Ottawans here too.

costumeczar Posted 27 May 2015 , 12:18am
post #14 of 34

Looking for business on facebook  is like scraping the bottom of the barrel. People will post a photo of a cake and say "who can do this for cheap," then the bidding war starts---For people seeing how cheap they can bid the job down. By the time most of this mess is done people are selling three tiered cakes for $30.

Unfortunately, the custom cake market in most places is totally oversaturated at this point. After years of people watching cake shows and thinking how fun it must be to have a cake business, then starting one without any understanding of how to run a business, prices are actually dropping. Unless you're established in your area and have a good referral network it's going to be difficult to make a decent income doing JUST custom cakes. You might want to offer undecorated dessert cakes too, or cookies or pies or dessert buffets or whatever will sell in your area. What will sell in your area is something that you have to figure out. Look around...If there are twenty cupcakes shops already that market might be hard to get into. Find something that isn't already being provided by everybody and their brother.

If you've priced out your cakes and know how much you need to charge to make a decent profit, you're not overcharging. Make sure that you're actually earning money at $3 a serving, because if you're only clearing $5 an hour after expenses it isn't worth doing cakes as a business. You might as well go off and work for someone else at minimum wage, still earn more than you do now, and not have the aggravation of finding customers, doing paperwork, marketing, networking, etc.

I wrote a blog article that I have scheduled to go up tomorrow about the "cake lady" syndrome.  Drives me crazy...

toriannlynn Posted 27 May 2015 , 1:41am
post #15 of 34

Yes I agree with your comment! I have done pricing sheets and at $3 per serving I do make a pretty good profit. I just need to get a good customer base. I still work a full time job bc I don't get enough orders at this time. I really feel that in the small low income town I live in is holding me back. 

costumeczar Posted 27 May 2015 , 1:55am
post #16 of 34

 

Quote by @toriannlynn on 10 minutes ago

 I really feel that in the small low income town I live in is holding me back. 

 You're probably right...The climate is different now economically and with the number of competitors in existence. A lot of people shop on price alone because a custom cake isn't a necessity. A lot of the old marketing "rules" don't hold true anymore. It's a buyer's market, with the number of illegal bakers and cottage bakers and hobby bakers who sell a cake here and there (also illegally). If you're in a lower-income area and a smaller area it will be harder to find a customer base that's willing to pay a decent amount for cakes, because they just don't have to.

toriannlynn Posted 27 May 2015 , 2:54am
post #17 of 34

Thank you guys for your help and advice. I guess I just need to keep at it and do all the shows and fairs I can and hopefully expand my client base. 

WhimsyCakes Posted 28 May 2015 , 9:06pm
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I just wanted to say that I do have a very successful business on Facebook, so it CAN be done. I live in a small resort town and yes, I probably did start out undercharging, but not for long! Once I felt my skills were up there with the local bakeries I raised my prices and have not looked back since.  For the town I live in, Facebook has been the best venue for getting my cakes out there. I have earned the reputation I now have and people know what they will get; a quality cake that tastes great but is also meticulously decorated. I definitely still get those who ask about a cake, then receive my pricing document and I never hear back from them. Good!! Those are the clients I'm happy to weed out. No, I'm not doing a 2-tiered cake for $50! I worked myself to death in the first year of my business but those were the learning years and I wouldn't have expected to make top dollar. Now I am working much less and making way more money. Working smarter not harder...and all through Facebook. So just wanted to say that it can be done if you earn the reputation.

toriannlynn Posted 28 May 2015 , 11:57pm
post #19 of 34

Thank you whimsy cakes! There is another baker in my town and I have seen her prices And she charges about $20 less than me and she usually throws in decorated cookies etc. so she is my only real competition and her cakes are as good as mine 

julia1812 Posted 29 May 2015 , 4:32am
post #20 of 34

You know what: There are dozens of people in my town charging way less than me - and I don't give a finger anymore! Lol. 

Not my problem.  And I get more and more orders every day...still. Even turning down cakes cause I'm too busy. 

I am tired of letting other bakers dictate my price. If they do them for pocket money...so be it.


SquirrellyCakes Posted 30 May 2015 , 3:10pm
post #21 of 34

Is it possible that your competition that throws in the free decorated cookies and charges less, is just doing this temporarily to establish a reputation and clientelle?  Some people do this for awhile and then raise their prices.

Personally, knowing how much work both the cookies and cakes are, I wouldn't do it for a stranger. She must really love her work and perhaps doesn't need the income. 

ObsessionBakery Posted 30 May 2015 , 3:21pm
post #22 of 34

We're just outside of Montreal, Quebec, Canada and our custom cake prices are calculated per portion (buttercream cakes start at $2.25 per serving, and fondant-covered cakes at $4.25.  This pricing, of course, depends on the level of detail, hand work, etc...  There will always be people who will throw the 'I can get it cheaper at "XXX" line at you, but unless you're satisfied with a cake that is loaded with ingredients you can't pronounce, then I say we're pretty competitive.

Debbie45628 Posted 31 May 2015 , 12:55am
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Where do you live?  I am also about an hr from Columbus...

toriannlynn Posted 31 May 2015 , 1:44am
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I live in Bellefontaine, Oh. 

toriannlynn Posted 31 May 2015 , 1:50am
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That could be a possibility squirrellycakes. And thank you for your input obsessionbakery. Im not the esablishes I am really just starting. I have made a lot of cakes for close family and friends and I think my cakes look really great its just the problem of getting a client base. 

toriannlynn Posted 31 May 2015 , 1:51am
post #26 of 34

And Julia thank you for your advice. Do you have any ideas how I could get my name out in the community?

julia1812 Posted 31 May 2015 , 7:31am
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It takes time to get your name out there. At least it did for me. Almost a year until I was booked to my full capacity. Since I do mainly kids birthday cakes it was sort of easy because kids started staying "I want a birthday cake just like. ..". So my number started making a round. I didn't advertise or anything, just mouth by mouth. There are many others doing cupcakes and cakes, but theirs are more simple and not homemade ingredients like mine. 

I get the occasional calls from people with small budgets but most of the customers tell me "I want this cake. Just tell me how much I owe you." 

Quality has it's price. And so does my time. If nobody would pay my price I would stop making cakes. If I can't enjoy making them (=getting paid decent amounts) there is no point in continuing with it just for people basically taking advantage of me.


ObsessionBakery Posted 31 May 2015 , 11:42am
post #28 of 34

We have found that Facebook is an excellent channel by which to reach out to people.  We've got over 2,400 followers and it costs us nothing but the time it takes to post photos and keep in touch with customers.  Through our FB page, we also follow others - lots of great connections to be found!  https://www.facebook.com/Obsession.Bakery 

A couple of suggestions on how you can get your name out there:  

Donate a cake to a local charity or fundraiser - in exchange for publicity; it might cost you a few dollars, but it can certainly pay off in the long run...

Participate in markets, craft fairs and shows, etc...

ALWAYS put your name on your photos - it makes it more difficult for others to claim your hard work as their own, and it can also help people find you and get in touch with you for future orders...



toriannlynn Posted 31 May 2015 , 12:13pm
post #29 of 34

Thank you guys again! You all are really pointing me in the right direction!

SquirrellyCakes Posted 2 Jun 2015 , 5:52pm
post #30 of 34

Slightly off topic but I haven't been on the cake sites in about 7 years.  Back then what we considered to be the  "underpricers " , were charging $1- $2 a serving for buttercream decorated.  Most decorators were charging  $3- $7 a serving for  buttercream and fondant decorated cakes were  within the $4- $7 range. 

I know the market has become increasingly glutted with decorators but it is rather surprising to see that prices haven't kept up with increases in costs. Especially with the additional time consuming methods, decorations and equipment costs. 

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