Originally Posted by cupadeecakes
If you are starting out, you can't set your prices equal to other in the area that are established. You shouldn't undercut them either. When I started I was very "cheap" but as my cakes got better, my prices increased, as well as minimums. You need to do what it takes to start the business and sometimes that may mean making $1 on a cake. Next time may be the 1st birthday and you'll make more money. Also, if square cakes take you longer to get perfect, then offer rounds instead. I can get two rounds done in the time it takes me to do a square, so I charge more per serving. I'm 6.5 years into this and you charged my prices, so yes I think you are quoting too high. If someone is taking a chance on a new business they don't want to pay the same price as the established bakery across the street. You will get there, but you have to have a following and more business than you have time, then you raise prices. Good luck.
Good insight, and I see where you are coming from. It is very difficult to find that balance between not undercutting someone and not being equal. I know that I can't be more. I am higher than a few places in town, but I do everything from scratch. The rest are considerably higher than me.
I don't want to fall into the scenario where I start out doing cheap cakes and when it comes time for people to reorder, I am too high for them.
My primary job is as a hairstylist. I try to relate new business to that. When I was first starting out, I didn't charge less because I was new. I slowly built my business with clients who would pay my prices to begin with.
Thanks for your reply, guess I have somethings to think about.