AFor single tier party cakes (which are the majority of our business) we include a serving range based on generous portion sizes, since usually a professional will not be cutting the cake. Pricing is based on cost + markup, so the incremental price increase between sizes is relatively small, which makes upselling easy.

For example, if a customer wants a basic BC cake to serve 12 people, I will recommend either an 8" round (serves 10-14) for $44 or a 10" round (serves 16-20) for $54 if they want leftovers. Most of the time they will go for the larger cake.

Multi-tier cakes for any event where the cake will be cut by a professional at the venue are priced based on Wilton servings, since that's the standard for how the cake will be cut.

I've never been one to skimp on my servings. I look at the Wilton serving chart as a basis to start and then work from there, always calculating a little extra. I personally would not skimp on serving my guests at home and would prefer if they want a second helping that it be available. With that in mind I calculate my cakes based on cost of supplies and then work and time involved to make them and still charge to the lower side.  When my customers ask how much, before working out the details of the design and size, I always tell them the truth:

"I can guarantee that my cake will cost you more than making it at home and less than a high end bakery."

After that customer called for a quote on 250 buttercream frosted cupcakes with no embellishment, and I quoted her $300 for the job (a whopping $.83 per cupcake!!), and knowing full well that I drastically undercharged myself, I went back and started looking at my cost again. From now on when a customer asks about the cost of cupcakes my unwavering answer will be that they start at $2.00 per and go up depending on deco.

Now, to work out an unwavering answer for my cakes as well. lol

I'm curious to know what you all would have charged for this wedding cake please. It was a 4 tier cake (12', 10", 8" and 6" x 2"layers) all frosted in buttercream. 2 layers were chocolate filled with a simple chocolate mousse, and 2 were white with a simple vanilla mousse. The bride provided fresh flowers and raffia to wrap the cake in. 

 This was only the 4th wedding cake I've made and would happily just make wedding cakes if I could.  Thanks in advance for in put.  I'll tell you all how much I charged for this after.

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Sorry, they were 4" layers not 2". lol

This one had an interesting outcome. The bride (A friend of my daughter) came to me with a pic of what she wanted. A few months ahead of the wedding date. We worked out all the details and were just waiting for the date to come around. But the bride, already on a tight budget, got into a serious auto accident a few weeks before the wedding that would potentially cost them quiet a bit of money. So she tearfully had to cancel her cake order and was opting for a Walmart cake, literally.

I really wanted to help her and I really wanted to make this cake, but she wouldn't even come talk to me to try to work it out. The next thing I knew, my daughter and her friends all pulled together to purchase all of the supplies needed to make the cake as their gift to the couple. And the bride was very appreciative.

My quoted price for this cake was only $400, set up and delivery are free. I am sooooo working on getting my pricing where it should be!
 

A

It sounds like you're agreeing then. I don't count serving sizes differently either, which is what the blog explained.

Lots of people charge differently for party vs weddings, which makes no sense to me, it's all the same amount ofcake.

I think your problem sounds like it comes from spending time dealing with clients arguing with you, which is a totally different problem than calculating serving portions. If you're making decent money on wholesaling to the country club then maybe you could focus on that. If not, could you raise your prices with them some?

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I'd be around $700 for that size in buttercream.

AThis was a very useful post for me. I'm going to have to get some scratch paper so I can write down some of my specific questions. You are all so helpful and full of good advice. Why did I only sign up to be a member of this site yesterday!?!??

The only way I know how to be able to find this post again is to comment on it.

Would someone please tell me how I add (profile) pictures? How to upload my logo for critique? Thank you in advance!

A

A^^^^^ sorry.... Trying to ask jason_kraft how much he would charge for those same size cakes covered in fondant and basic bc piping?

AThe prices above are for basic BC. Covering the cake in fondant is an additional $30 for an 8" or $40 for a 10", plus any additional BC or fondant decorations.

ASo what I'm hearing based on all the comments I've read is that I'm significantly underpricing myself! For a 4" and 8" covered in bc with fondant zebra stripes I charge $55 and for both tiers to be covered in fondant $70. I've got to get firmer with myself and not just give away the cake because I'm afraid they won't say yes.

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Uh, yeah...I charge $88 for an 8" buttercream round. Zebra stripes would be more.

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A good way to tell if you are undercharging is to take your price, subtract ingredients/supplies and overhead, then divide the remaining amount by the number of hours it took you to complete the order to give you an effective hourly wage.

As an example: starting with $55, if ingredients and supplies are $15 and overhead per order is $10 (e.g. $500 in annual license fees and insurance / 50 orders per year), you have $30 left. So if the order took 2 hours to complete (including prep, baking, decorating, packaging, and cleanup) you are in good shape with a $15/hour wage. But if you spent 8 hours on the order, you are paying yourself $3.75/hour. Before taxes.

This is an oversimplification, in reality your wage would be lower since you would also have a markup in the 15-45% range for profit that is reinvested in the business.

All of you have been so very helpful. I love discussing this and it's giving me a little more confidence in my cake pricing. I've been underpricing myself horribly!! But part of that is due to being "self taught", not being a "professional", and working on the side from my home. And too, I'm wanting to make the cakes so badly that I end up under charging just so that I get the order.

I just spent a couple of days reorganizing my cake photos in a portfolio on my Facebook account and adding pricing in for potential customers to get an idea of what I charge for custom cakes. The photos are set for public viewing. Jason, I'm in Bakersfield, so not far from you, and I was wondering if you might take a look and slap my hand on a few of those cakes for me? On most of those cakes I put in what I would ask for today rather than what I asked for when I made them. And too, on some of them you can see how much I've grown and learned since I started making cakes. lol

The following link will take you directly to FB portfolio and Thank you for looking:

https://www.facebook.com/media/set/?set=a.4813630823034.1073741825.1364217028&type=3
 

I will tell you that if you do look at my portfolio, the blinged out wedding cake entitled "Jennifer", I made for a friend and only charged her $200. Not counting the diamond accents and the diamond mesh, which she ordered for me. And not taking into consideration the fact that we delivered it to Shaver Lake from Bakersfield CA.

AThe Central Valley is a very different market from the two I'm familiar with (San Jose and OC), but here are my first impressions on the products at the beginning of the gallery that IMO need to be priced higher:

King of the jungle = $200-300 Baby rattle cupcakes = ~$5 Graduation = $150-200 Guitar = ~$150 3D Fire Engine = ~$100 Fairy Tale Castle = $400-500 Drums = $150-200

FYI you may want to remove any cakes that feature copyrighted characters unless you have permission from the copyright owner.

Thanks for the feed back Jason!! I appreciate the input.
 

I'm just going to get started selling cakes and yeah, you can get a cake from Walmart for $30.  But it looks like a $30 cake.  Nothing wrong with $30 cakes, however, people need to understand that the level of skill it takes to make a $30 cake is far less than the cakes you make.  There are people who value your skills and will spend the money.  Don't waste your time on someone who devalues what you love to do.  

You have to look at your target market, remember that customers who want grocery store prices aren't going to be your customers. Don't get frustrated with people that aren't willing to pay what you charge. Those people will never be your customers. However you may be able to sway one or two people into paying what you charge by asking what they want.  Do they want a freshly made product(s) that's just the way they want it? Remember your customer is someone who likes choice, someone who wants a product the way the want it. In grocery stores there isnt a whole lot of choice and the quality is going to be different. You should also charge what you're worth. Don't undercut yourself.
 

A custom cake/cookie/cupcake maker and decorator will never be able to compete with a grocery store, and they shouldn't have to or want to.  Bakery items at a grocery store are a loss leader... they make no money on those cakes, etc., and they know this.  They get people in the door to pick up things they've ordered from the bakery (at a loss), and while they're there, they get other marked up items (ice cream, plates, party supplies, etc.).  It's kind of like "bait."  

I love my local custom cake bakery and always gladly pay more for the cakes I order.  They take my order personally and almost leave me speechless with every cake they do... they're so beautiful and tasty.  And the customer service is second to none... I really feel like my cake was the only one they did that day because they did such a great job!  I want to feel personally taken care of, and like my cake order matters to the cake shop's staff, and I always do.  No grocery store with their cookie cutter cakes will ever make me feel that way.  

Please have faith in your abilities.  The customers who want a custom cake and are willing to pay for the service you can give them (no grocery store can do this!) will come.