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What is the average price of the cakes you sell??? - Page 5

post #61 of 70

You should read all of the links at the bottom of Jason_Kraft's posts. Also, if you haven't already, find out if your state has a cottage food law and what your Health Department requires for selling baked good made at home.

Good luck.

There. Their. They're not the same.

 

I hope I die before "your" becomes the official contraction of "you are."

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There. Their. They're not the same.

 

I hope I die before "your" becomes the official contraction of "you are."

Reply
post #62 of 70

I am already upping my prices as we get closer to 2014.. My average sale has been anywhere from $50-$500.. I will not do a cake under $150 because right now my time is money.. I am a work at home mom of 4. I homeschool the two older ones (6 & 8) and the two little ones (2 and 4m) keep me busy.. It seems kind of uppity for the area I live in (southern Oregon) but I do have repeat clients that appreciate the custom quality work I do.. Most people around here want free cake and I will NOT do that, even if it costs me a sale..

post #63 of 70
Quote:
Originally Posted by costumeczar View Post
 The profit margin on decorated cakes is a lot lower than other sources of cake-related income, and you have to make a lot to make a decent living. It also takes more time to make that profit. If I make a $500 cake my net income from that is about half of it after I take out expenses, advertising, ingredients, insurance, etc etc etc. There's also the time invested in getting those cakes by marketing yourself and dealing with clients. If I can earn $250 for teaching a two-hour class that takes an hour of prep time I've just made the net amount from one cake plus saved myself a heck of a lot of time and effort. Cakes alone will not make you rich.

 

I saw one baking forum once where somebody had posted a question about what kinds of retirement programs are offered to bakers. I think he was thinking about going into the baking industry and wanted to know about his future pension etc. All the bakers on there basically laughed at him and said the retirement program was that you don't get one and you can basically plan on working until you can't physically work anymore. That's something that you also need to think about if you go into this business. You'll need to take responsibility for your own retirement savings since you're not going to have a boss matching a 401K for you.

 

1.  I said this in another thread, but I'll reiterate:  In the world of food production, bakery goods, including cakes, are considered loss leaders for the reasons you just described.   You've got a make a ton of cake, cupcakes, bread, etc., in return for a tiny bit of profit.  I know a couple of licensed home bakers who have had to take day jobs because, as sole proprietors, simply don't make enough money just doing cakes.  One of them expanded into other baked goods in addition to cakes, and it still wasn't enough.

 

2.  Unless you're a baker working for a company, this is true -- there are no 401Ks nor pensions in this business.  You have to be able to look further ahead and prepare yourself now, such as investing in a Roth IRA or investing some money via a brokerage.  I know one old-time baker who worked his FT morning baking job then went to FT non-baking job.  He'd get home around 10 or 11PM, sleep for a couple of hours, and be up and at the baking job by 4AM.  He did this for years.  He retired from both jobs when he was in his late 50s with a nice chunk of change from both companies for his retirement.

post #64 of 70
Quote:
Originally Posted by embersmom View Post

there are no 401Ks nor pensions in this business. 

If you own your own company you can set up an individual 401(k) plan, even if you are a sole proprietor.
For example: https://investor.vanguard.com/what-we-offer/small-business/individual-401k
post #65 of 70
$40. I'm new and work according to Mississippi's cottage food laws. My basic white/chocolate cakes with vanilla IMBC or American buttercream frostings are $1.50/slice plus $5 for box, etc. I bake from scratch if that makes a difference.
post #66 of 70
Quote:
Originally Posted by jason_kraft View Post


If you own your own company you can set up an individual 401(k) plan, even if you are a sole proprietor.
For example: https://investor.vanguard.com/what-we-offer/small-business/individual-401k

 

If you own your own company, you are also the employer contributing towards this plan... so it's really just another way of you saving your own money, no?

post #67 of 70
Quote:
Originally Posted by jennicake View Post

If you own your own company, you are also the employer contributing towards this plan... so it's really just another way of you saving your own money, no?

Correct, with the added benefit that employer match contributions may be tax deductible as a business expense and individual 401(k) contributions can be made pre-tax.
post #68 of 70

I did this cake for my sister in law and only charged $250 for it. I really only charged her for supplies, it was her wedding gift. I was wondering what should the actual price of this cake be?

 

http://cakecentral.com/g/i/3111679/other-mixed-shaped-wedding-cakes/u/871699/flat/1/

Kayla
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Kayla
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post #69 of 70
Quote:
Originally Posted by KayJaneeLacombe View Post
 

I did this cake for my sister in law and only charged $250 for it. I really only charged her for supplies, it was her wedding gift. I was wondering what should the actual price of this cake be?

 

http://cakecentral.com/g/i/3111679/other-mixed-shaped-wedding-cakes/u/871699/flat/1/

The roses are all handmade from gumpaste also!

Kayla
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Kayla
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post #70 of 70
Quote:
Originally Posted by KayJaneeLacombe View Post

I did this cake for my sister in law and only charged $250 for it. I really only charged her for supplies, it was her wedding gift. I was wondering what should the actual price of this cake be?

http://cakecentral.com/g/i/3111679/other-mixed-shaped-wedding-cakes/u/871699/flat/1/

Check out the pricing formula link in my signature below to add up all the costs involved in making the cake (ingredients, labor, overhead) and a profit margin in line with local market value.
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