Cake Central › Cake Forums › Cake Talk › Cake Decorating Business › Sooo, undercutting doesn't hurt the industry, huh?
New Posts  All Forums:Forum Nav:

Sooo, undercutting doesn't hurt the industry, huh? - Page 3  

post #31 of 110
Quote:
Originally Posted by LoveMeSomeCake615 View Post
 

Exactly! There's NOT enough to work to go around! Any market can only bear so much competition before it's oversaturated. And when the competition is oversaturating the market AND charging ridiculously low prices just to get business, it devalues the market as a whole

I know only two custom cakers, both of whom live in areas either not served by a major supermarket or not served by any of the numerous decades-old storefront bakeries that are as common as weeds in this area.  It took both of them many years before they could consistently turn a profit.  Neither of them are currently doing it FT, however.  They both took non-culinary jobs to pay the bills.  One will still occasionally bake something if it's for a repeat customer.  The other one sold most of her equipment on Ebay and said goodbye to the whole thing :sad:

 

At work we get a lot of people pricing us for specific cakes (tiered, 3D, etc.) after going to the decades-old storefront in the area.  When we tell them that no, we aren't equipped to do such a cake (I'm one of those dreaded supermarket decorators, btw -- horrors!) nor can we customize with the breadth and depth as the storefront...wow, you should see some of the reactions.  We had one woman who literally screamed at my manager that we were ungrateful (@#&@$*(&*@ because we didn't want her business.  My manager just calmly looked at her and said, "Then why don't you just go back to the storefront and SPEND THE MONEY if you WANT that particular CAKE, then?"

 

Then sometimes we'll get a customer who will conspire with either myself or my coworker to do something under the table.  It's a fire-able offense, so no, sorry.

 

I feel for those of you trying to make a living under the cottage law.  I really do.

post #32 of 110
Quote:
Originally Posted by embersmom View Post

 

I feel for those of you trying to make a living under the cottage law.  I really do.

 

It is worse when the undercutter has their own storefront.  :(

 

I don't do carved/shaped/novelty cakes, in large part because the bakery who seems to specialize in this type of thing in my town charges next to nothing.  Her pricing has poisoned the well for all others who want to compete in this area.  Oh, I guess she might charge $5 more than the 20 to 60 cottage bakers available in a 5 mile radius, but that doesn't mean anything.

 

I don't have a real urge to do those, so it isn't a big deal to me on the carved cake front, but it really just devalues the cake/dessert market as a whole.  Which stinks.

 

Liz

Follow me on my Twitter handle: @Sugar_Iowa

Or on Facebook: https://www.facebook.com/SugarFineBakedGoodsAndConfections

Follow me on my Twitter handle: @Sugar_Iowa

Or on Facebook: https://www.facebook.com/SugarFineBakedGoodsAndConfections

post #33 of 110
Quote:
Originally Posted by iredoo View Post
You just wait... those 3D printers will make all of that soon. :) Yum.. plastic.

 

3D printers for Sugar work is already invented and in use for making sugar Cake Toppers.  Saw it on TV.

~~We are living in a world today where lemonade is made from artificial flavors and furniture polish is made from real lemons. ~Alfred E. Newman  
Halloween
(4 photos)
Cupcakes!
(13 photos)
Fishing / Hunting
(11 photos)
~~We are living in a world today where lemonade is made from artificial flavors and furniture polish is made from real lemons. ~Alfred E. Newman  
Halloween
(4 photos)
Cupcakes!
(13 photos)
Fishing / Hunting
(11 photos)
post #34 of 110
Thread Starter 
Quote:
Originally Posted by liz at sugar View Post
 

 

It is worse when the undercutter has their own storefront.  :(

 

I don't do carved/shaped/novelty cakes, in large part because the bakery who seems to specialize in this type of thing in my town charges next to nothing.  Her pricing has poisoned the well for all others who want to compete in this area.  Oh, I guess she might charge $5 more than the 20 to 60 cottage bakers available in a 5 mile radius, but that doesn't mean anything.

 

I don't have a real urge to do those, so it isn't a big deal to me on the carved cake front, but it really just devalues the cake/dessert market as a whole.  Which stinks.

 

Liz

Yeah, we don't really do a lot of them either, because everyone wants one and no one wants to pay for one.:roll:

 

 My husband is the one who does them, and he is amazing at it. But if he's going to do one, he's going to spend hours on it getting every little detail right, and no way is he going to do that for no profit! So we really don't mind at all if someone changes their mind about a shaped cake once they see the price.

 

Thankfully we both have full time jobs that pay the bills, so we don't have to take any job we don't want to take. BUT we used to have a storefront, so I totally understand needing jobs to make a living and not being able to get them because people are cheap. :-t

Before you ask- I'm licensed, inspected, insured, and all that jazz.
Before you ask- I'm licensed, inspected, insured, and all that jazz.
post #35 of 110
First... you are believing that she was quoted at other places $50-70 for a shaped cake, she could be lying just to get you to drop your price. I've heard that from customers... "well so and so quoted me only $ amount for the same cake". Well if that was the case they would just go to the other decorator. You don't know for sure if the low quotes are real or just their way of getting a lower price from you.

I work from my home kitchen (and yes it's legal in my state). I charge 6.00 + a serving for my shaped cake with a min order of 50 servings because they are take more time then regular shaped cakes.

I know that most store front cake business think the home cake decorator undercuts but that isn't always the case. My prices will be a few dollars less because I don't have a store front but I know the value of my cakes and price accordingly. they will always be alittle less but I have a right to cake decorate from my home and charge less then store front. My overhead is as big. My cakes are way better (taste and design) then alot of the local cake shops. I take less orders then them and can really take my time to make each cake perfect. I really can't stand the bashing of the home decorator anymore. I am part of the INDUSTRY! I look at my home based business as just that a business. It's not just a hobby. I work very hard at my cake decorating skill.

I've had plenty of customers that think my prices are too high. I don't budge on my prices, home business and all.
post #36 of 110
Quote:
Originally Posted by vervainangel View Post

First... you are believing that she was quoted at other places $50-70 for a shaped cake, she could be lying just to get you to drop your price. I've heard that from customers... "well so and so quoted me only $ amount for the same cake". Well if that was the case they would just go to the other decorator. You don't know for sure if the low quotes are real or just their way of getting a lower price from you.

I work from my home kitchen (and yes it's legal in my state). I charge 6.00 + a serving for my shaped cake with a min order of 50 servings because they are take more time then regular shaped cakes.

I know that most store front cake business think the home cake decorator undercuts but that isn't always the case. My prices will be a few dollars less because I don't have a store front but I know the value of my cakes and price accordingly. they will always be alittle less but I have a right to cake decorate from my home and charge less then store front. My overhead is as big. My cakes are way better (taste and design) then alot of the local cake shops. I take less orders then them and can really take my time to make each cake perfect. I really can't stand the bashing of the home decorator anymore. I am part of the INDUSTRY! I look at my home based business as just that a business. It's not just a hobby. I work very hard at my cake decorating skill.

I've had plenty of customers that think my prices are too high. I don't budge on my prices, home business and all.

 

I commend you for doing your part to keep our industry elevated!  It is hard when any of us get lumped into a group where we really don't belong.   :)

 

Liz

Follow me on my Twitter handle: @Sugar_Iowa

Or on Facebook: https://www.facebook.com/SugarFineBakedGoodsAndConfections

Follow me on my Twitter handle: @Sugar_Iowa

Or on Facebook: https://www.facebook.com/SugarFineBakedGoodsAndConfections

post #37 of 110
Quote:
Originally Posted by liz at sugar View Post

It is worse when the undercutter has their own storefront.  icon_sad.gif


YOU SPEAK THE TRUTH!

My prices aren't even that high, and I am quick at carved cakes (I prefer them to round ones if I'm honest). I know I have loads of room for improvement but even so I am better than so many of the local businesses who are severely undercutting me AND operating with a store front...

My absolute favourite recently though was a woman who contacted me for a quote for those doll cakes, you know the kind with the cake skirt? I have never made one, I've never been asked and honestly it's never struck me as something I wanted to do for the fun of it, but when I quoted her she wanted examples of cakes I had previously done, so I showed her all kinds of cakes much more complicated than the task she was suggesting. She didn't get back to me, so I politely messaged her asking whether she wanted to go ahead with it. Her response? I've booked with ''this less skilled company'' because you don't have enough experience in this particular cake.... icon_confused.gif??: I had a quick peruse of their online gallery and was shocked, like I get that non caking people don't see what caking people see but still....
post #38 of 110

Unfortunately there are two factors working here. 

 

The first is the home baker who really has no business sense and who thinks that if they cover their costs and make a little bit extra then they are in front.  They do not put value on their time as they either do it in their spare time or are not working anyway and any extra money is a bonus (and if you are short of cash and unable to get a job for whatever reason every little bit can help if you are on a limited income).  Or they see it as a wonderful pass time and are happy to just cover their cost with a little bit extra to buy more cutters etc. and so support their hobby.

 

The second factor is Joe Blow the public.  They really have no idea and if they first see or hear about the type of bakers above they take that to be the norm.  Or they think that because you are doing it from home that it should be cheap.  This applies to all things made from home, not just cake.  And they think that you are doing it for your own enjoyment and so shouldn't charge for your time.  I once had a lady ask me if I would make her a Hardanger mat (A type of embroidery) after seeing one I had made.  She thought it would be worth about $50 when I queried how much she would pay,  chuckling to myself.  She had no idea that it had taken me about 100 hours to make.  People just have no idea of the time invested in any of these things and need educating.

post #39 of 110
Quote:
Originally Posted by vervainangel View Post

First... you are believing that she was quoted at other places $50-70 for a shaped cake, she could be lying just to get you to drop your price. I've heard that from customers... "well so and so quoted me only $ amount for the same cake". Well if that was the case they would just go to the other decorator. You don't know for sure if the low quotes are real or just their way of getting a lower price from you.

I work from my home kitchen (and yes it's legal in my state). I charge 6.00 + a serving for my shaped cake with a min order of 50 servings because they are take more time then regular shaped cakes.

I know that most store front cake business think the home cake decorator undercuts but that isn't always the case. My prices will be a few dollars less because I don't have a store front but I know the value of my cakes and price accordingly. they will always be alittle less but I have a right to cake decorate from my home and charge less then store front. My overhead is as big. My cakes are way better (taste and design) then alot of the local cake shops. I take less orders then them and can really take my time to make each cake perfect. I really can't stand the bashing of the home decorator anymore. I am part of the INDUSTRY! I look at my home based business as just that a business. It's not just a hobby. I work very hard at my cake decorating skill.

I've had plenty of customers that think my prices are too high. I don't budge on my prices, home business and all.

YES, YES and YES to this!   I applaud you for standing up for all of us home cake businesses. Yes, we are most definitely part of the industry and shouldn't be scorned just because we haven't taken that road and confined ourselves to a storefront 24/7!

 

I am a home baker as well with a separate licensed kitchen. I recently responded to another thread about pricing and was accused of charging too little and was belittled for being "just" a home baker and not setting my prices to match those having a storefront. The reality is that my pricing is only slightly lower (50 cents to $1.00) than the other custom cake designers with storefronts in my area and I am HIGHER than the only bakery in my small town. Recently, a potential client asked for an estimate, I gave her one, and she said that she was going with another licensed baker 45 minutes away that could do the same for $250 less...or so said. I must admit, this baker does great work, but on her FB page she explains why she's less expensive; because she has no storefront, thus, less overhead.  No wonder customers are confused!

post #40 of 110
Shoot, technically I'm a home baker, but I don't care if my overhead is less. I get the impression that is a copout for some people to justify being cheaper, NOT referring to anyone in this thread, just a general observation. So your overhead isn't as much, so what. I don't get the same deals as a bakery though when it comes time to buy flour and ingredients. I don't have room for bulk purchasing, nor do I have the need for hundreds of boxes or pounds and pounds of sugar or other things that the bakery pays a lot less for. A lot of what I use is bought right of the grocery store shelf like any other consumer, so there's higher costs right there.
*Top 100 Designers in The USA, Brides Magazine, 2013*<---little ole' me!
Birthday Cakes
(2 photos)
Birthday Cakes
(2 photos)
*Top 100 Designers in The USA, Brides Magazine, 2013*<---little ole' me!
Birthday Cakes
(2 photos)
Birthday Cakes
(2 photos)
post #41 of 110

There is a lady in my city that charges .65 cents per cupcake -_-  She gets quite a bit of business but she can't be making any money.

No his mind is not for rent, to any god or government...

No his mind is not for rent, to any god or government...

post #42 of 110

 "There's NOT enough to work to go around! Any market can only bear so much competition before it's oversaturated. And when the competition is oversaturating the market AND charging ridiculously low prices just to get business, it devalues the market as a whole."

 

so true!

 

There are tons of shoddy cakes being sold here, mainly advertised on FB groups. Most look like a blind kitten made them and without a doubt they are severely undercutting the legal cake makers. It's sad but so are their cakes, usually. but it does devalue the entire market. 

 

post #43 of 110
Quote:
Originally Posted by AZCouture View Post

Shoot, technically I'm a home baker, but I don't care if my overhead is less. I get the impression that is a copout for some people to justify being cheaper, NOT referring to anyone in this thread, just a general observation. So your overhead isn't as much, so what. I don't get the same deals as a bakery though when it comes time to buy flour and ingredients. I don't have room for bulk purchasing, nor do I have the need for hundreds of boxes or pounds and pounds of sugar or other things that the bakery pays a lot less for. A lot of what I use is bought right of the grocery store shelf like any other consumer, so there's higher costs right there.

 

Ditto...I tell people this all the time.  I am very thankful that OH is a cottage law state.  I wouldn't want a shop.

 

I have to remember that we are comparing those of similar skill when talking about undercutting - which is hard for me to keep in mind and I get all worked up about certain posts about undercutting.

 

IMO, I don't care if crummy decorator down the road is working her a$$ off doing a ton of ugly cakes in a weekend, I don't want her customers and they can't afford me.  That's not my competition.  I don't want to live like that.  One great cake, really decent money, move on. 

Aah, cake. . .the 5th food group!!
Aah, cake. . .the 5th food group!!
post #44 of 110
Quote:
Originally Posted by cakefat View Post
 

 "There's NOT enough to work to go around! Any market can only bear so much competition before it's oversaturated. And when the competition is oversaturating the market AND charging ridiculously low prices just to get business, it devalues the market as a whole."

 

so true!

 

There are tons of shoddy cakes being sold here, mainly advertised on FB groups. Most look like a blind kitten made them and without a doubt they are severely undercutting the legal cake makers. It's sad but so are their cakes, usually. but it does devalue the entire market. 

 


I'm OBVIOUSLY not a business expert, but isn't this comparing apples to oranges?  Target to Abercrombie?

Not everyone is competition.  Do you consider Walmart or Blind Kitten Bakery your competition? 

Blind kitten cakes are OK for people who don't prioritize cake, or appreciate the art and skill, or have the budget to purchase a fabulous cake.  They gotta eat something for dessert!

If people DO value quality and skill and have the budget, they will seek out the appropriate cake maker.

 

If I am way off base - as I usually am :) - please, someone, help me see the light.  In the nicest way possible.

Aah, cake. . .the 5th food group!!
Aah, cake. . .the 5th food group!!
post #45 of 110

You'd be surprised.  I have so many friends who would consider themselves "cake snobs" now because of me LOL.  Before, they'd see some shoddy wilton cake and think "OH HOW CUTE!!!" but now that I've shown them real works of art, they think 'Ugh, thats not cute, its lumpy, is that edible paper??".  I seriously am starting to think part of our profession is educating people! haha 

Getting baked since 2009! ;)
Getting baked since 2009! ;)
New Posts  All Forums:Forum Nav:
  Return Home
  Back to Forum: Cake Decorating Business
This thread is locked  
Cake Central › Cake Forums › Cake Talk › Cake Decorating Business › Sooo, undercutting doesn't hurt the industry, huh?