Hello! I'm new to the forum (and to the baking business) and have a question regarding large event pricing. In my previous field of graphic design/print, there was always the expectation that buying more meant paying less and I wondered if there is the same expectation in the baking business. I have the opportunity to create a dessert bar at a large event and it has been hinted that since they will be purchasing more than I usually sell, that the cost should be less. I don't agree because I am already buying in bulk so my cost won't be less, and my time will be waaaaay more. But I thought I should get some expert advice from this forum. Can anyone shed some light on it? Thanks so much!
I do not offer a bulk discount because it is not cheaper or easier for me to make large quantities.
If anything, when supplying for a large event it can be more difficult to find enough storage space for the completed items!
Many similar posts here have had responses that say exactly what you say Baker Beach. There is no "additional savings" to pass onto the consumer.
The one exception I read, and agreed with, was with someone who had a "standing order". That is, 10 dozen cookies every Friday. In this case, the "down time" or "free time" available during the week was better utilized having busy work available. So, labor savings and utilization may, in fact, lower your overhead.
It's not like a factory where you throw the switch for an extra 10 minutes and 3,000 cookies pop out.
Well...guess it depends on the dessert. If it's something not so time consuming like macaroons or pudding or mousse or cream puffs and.... (I think you get my point) that you can do in bulk - yes I'd give a discount as you only need to produce one huge batch of everything so your actual time working on it is less. But if it's stuff like petit fours, éclairs, mini cakes etc I wouldn't. And make sure you make a worthwhile profit out of it in any case!
I don't give bulk discounts, either, especially if it is not a standing order as mentioned above. They can hint all they want to, but it would be a no from me. I did 500 cupcakes for my daughter's school and they asked for a discount.....negative.
I agree with the others, but you also have to consider how your pricing is structured. I would think you might do what your customer is describing sometimes, but in the opposite way, because even though your ingredient cost and time are consistent when scaled up and down, your overhead, packaging, and miscellaneous expenses don't necessarily prorate. (For example, do you really use more dish soap washing a 12 inch pan than a 6 inch pan? Does a 12 inch cake round cost the same amount of cents per associated serving as the 6?) So even if you basically price by serving, your smaller items may not enough servings to justify overhead when distributed among fewer servings, so you may account for that differently. You may establish a different cost per serving for items or different sizes, or you might build in an order minimum, or cost by the total item rather than serving to make sure your smaller products are even worth turning on the oven, KWIM? To customers it feels like a bulk discount, but really it's a small upcharge for smaller orders.
Thank you all for all your comments! It really helps to get advice from people who have "been there" and know that my thinking was on the right track :). And I also agree, johnso60fus, that if there is a standing order that is kind of a different case. Hopefully, I can help some of you out some day!
I will offer a bulk discount if they have a large order (300+ cupcakes or cookies) and they choose only 1-2 flavors. If they choose several flavors of different items, then it's full price.
Thank you! That makes sense and really good to keep in mind for other orders. But for this order there will be small cakes in several flavors.