I am just starting out and a local restaurant has offered to put my cupcakes and single serve birthday cakes, they would also like me to supply basic birthday cakes for customers. Obviously the price of these would be different than if I was selling direct to customers, so how should I price these in a way that it is favorable to me and the restaurant? Thanks in advance for any advice.
I generally take the cost to make and double it. I wholesale big cookies for 1.75 each with a dozen minimum and my pub charges the public $3 for the same cookie. If the restaurant you supply to marks up 50% then you both make money. Basic birthday cakes are a little tougher, but again. As a supplier, you don't have to cut yourself short on pricing. If they want your product. It's their job to mark up the product so that they make a profit.
You don't have to charge less because it's a restaurant. If you save money by buying in bulk, that's when you can pass on your savings to them. Otherwise be very careful. And if you're operating under a cottage food law, make sure you can wholesale, the law in my state says I cannot wholesale. Oh, and don't work for minimum wage or less, make sure to take not just your ingredients into account, but gas, electricity, wear and tear on your car, water and your labor, (etc).
Thank you so much for the replies, they were very helpful. I am almost ready to launch
Awesome answer. I am not allowed to sell wholesale either.