I wanted I know how everyone felt about customers wanting low priced cakes. Do you ever feel the need to change design etc to fit a small budget or are you happy to say 'No' if it's not worth your time to make something so cheap?! As a beginner in looking at running business I want to make sure I stand my ground and make profit out of what I do, but when someone says that a quote is to much and can I do anything cheaper I sometimes think.. Well no actually, if you want something that cheap go and buy it from a supermarket!! But I also feel like I should take as much business as I can get, however someone asked for a cake to serve 18 for under £35 which worked out roughly like this..
£11 - cake ingredients
£14 - fondant, ribbon, boards, box etc
£10 - my wage/labour
Thats basically like me saying that il only work on the cake for under 2 hours at £6 an hour labour!!
Funny, I had a bride contact me last night asking for the price of a cake...i told her...she wrote back and said, thank you, but I cannot afford that. I don't think that there is any harm in asking what their budget it and IF you can make something for that price, offering it to them but I would not reduce my pricing to fit their budget unless i really really wanted to make that specific cake for some reason.
You need to figure out your pricing and stick to it. When people say that they want a lower price you can, of course, feel free to tell them that you can't do it for that amount. If you're doing custom cakes you're not a supermarket that does a high volume of the same types of designs, so you shouldn't compare your business model to theirs.
I sell a pricing e-class that would probably put a lot of people into shock if they use it to figure out what they SHOULD be charging, but that's the facts, numbers don't lie. If I went to the Rolls Royce dealer and said that I wanted a lower price they're not going to go below a certain figure. They might strip the car of every option including the seats, based on my budget, but there's a point where they're going to say "no lower." You should figure out what your minimum is to make it worth your while to even turn the oven on, and put that on your website. That's your starting price and "extras" increase the price from there.
Don't feel that you have to decrease your prices for everyone, because that isn't good business. It's also dangerous in terms of customer service, because the trend now is for people to order a less-decorated cake then complain that they didn't get what's in their mind's eye... This was the complaint of last year and is still happening a lot, based on what I've heard from people. http://acaketorememberva.blogspot.com/2015/12/2015-year-of-imaginary-cake.html
I'm a very generous person I love sharing with people but I put on my business owner hat and don't waiver from my prices. They are what they are and if its not in your budget I can't fix that. Bakeries don't last here bc they don't charge enough they race to the bottom and close their doors faster than they open. I had a lady wanting a 2 tiered cake with custom decorations for $75 bc that's what a former bakery charged her for once before they closed. When I told her we start at $150 for 2 tiered cakes and the price increases from there according to the specifics of her order she quickly decided that she didn't need a two tired cake. Do I like telling people no I can't do it for the price they want of course I don't but how I feel can't be a factor in our prices. I will see if I can work within their budget for something they can afford and I can do and make a profit but I will not change my prices. As far as taking as much business as you can you'll just find yourself working for less and less. Because you'll attract the customers who talk you down on your prices. Our business plan allows us to stay small make decent profits and build our customer base and if we don't have a ton of orders each week our business still supports itself bc our pricing sets us up well with fewer orders. Lots of orders doesn't mean more money necessarily it still means lots of work though. Also in the cake business plan on giving people a reality check often bc what they want and what they can spend generally don't line up. And guess what that applies to me in other areas as a consumer it's just not the cake business. Most of us can't afford every custom thing we want so I'm not bashing people in just stating the clear fact that we don't always get what we want... Now I've got the Rolling Stones song in my head lol anyways.....
I refer people to my menu and price list when they first contact me. And when they go to our website this is what they see:
Standard buttercream cakes include 2 colors for icing and a written message. More detailed buttercream or fondant decorations increase price.
We do not stock toppers, DecoPacs, or edible images. These item increase the price of each cake. Some items are special order as well.
Note we do not list our sheet cakes as quarter, half or full. When you place your order for a sheet cake please have the servings needed available so that we can better serve you.
* Custom cakes, cupcakes and cookies will increase in price according to detail. Fondant is extra and will increase price per serving. Tiered cakes are custom orders and will be priced per order and our minimum on tiered cakes is $150.
"I understand your budget, and unfortunately I'm not the cake designer for you. However, I know there are bakers/bakeries who offer less expensive cakes. You might want to call (insert name.)"
Once I referred a caller to WalMart, because that's all her budget could afford.
No judgment, no shaming, just matter of fact and all business like. Hey, I want all sorts of things I can't afford.
Wow I never looked at making cakes this way... I guess because it's not a job/business. But a hobby however I do make tons of cakes lol I guess I'm kinda low budget but not cheap/free .... For instance I charged 80 for a small 2 teir cake (4inch top 8 inch bottom) for her daughter's bday... Vanilla cake vanilla frosting and fondant decor. Most I've charged was 250 for a 3 tiered wedding cake buttercream with 105 modeling choc roses. Lol
I have 2 local Walmart, the local Sam's Club and two grocery store phone numbers handy just for this!
I struggled for years over pricing. Too many times I cut my profit to make someone else's pocket happy. I have a minimum and stick to it. One gripe, one complaint or one uttering word about the price and they get the list of the above phone numbers with options to meet their needs.
I have no issues with telling people I cannot make a cake for that price or make a specific design they wanted for the budget they had. There is nothing wrong with telling people to try "(insert name of cheep cake lady with lumpy fondant)" I don't see it as being mean, but that's what their budget can afford; it's not worth taking on a order and not making any money.
Yep. When your hobby turns into your business, everything changes. You have to get, well, you know, BUSINESS-Y!
No shame in that.
Why should I lower my prices just because someone has an unrealistic budget?
There are plenty of cheap cakers out there. The race to the bottom is short and fast.
I'd much rather make one cake for $300 than 30 cakes for $10 each.
Thank you all so much for your opinions, it's been amazingly helpful reading through them all and I'm glad I'm not the only one who feels this way!!
costumeczar thank you for the link it was a really interesting read, I wondered if you'd mind posting the a link to the e-class you sell?!
Webake2gether.. Everything you've said sounds like me and I certainly need to find my 'business' head and not be so soft and generous!!
I give my price for their design. If that is too expensive, I offer alternative designs and prices. I suggest things they can do to save money. I would NEVER bargain on the price. Stand your ground if you think your price is fair. This is not the Bakery Bargain Basement.
@tessholly1 there are links to my class on my blog and website. I've sent them inquiries about advertising on here so that I can post links but nobody answered me.
I ran across this article today too, the low pricing thing isn't unique to cakes, it's every handmade business. People don't care about or appreciate the time that goes into making anything. http://www.creativehiveco.com/what-to-do-when-people-complain-that-your-prices-are-too-high/