Pricing For Wholesale

Business By mandze Updated 13 Feb 2006 , 4:46pm by ncdessertdiva

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mandze Posted 11 Feb 2006 , 9:27pm
post #1 of 16

I am currently working on supplying cookies, muffins, brownies and cakes to a coffee shop. I created menu and gave him samples to try. My question is I have figured out how much it costs me to make the product but don't know how much to charge him. I don't want to charge too much because then he would have to really charge high in order to make his profits. Any one have any suggestions on how to decide pricing to him so that we both can make a good profit?

15 replies
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Cakeman66 Posted 11 Feb 2006 , 9:46pm
post #2 of 16

I don't know about the coffee shop near you, but the one two blocks from my house charges $4 for a big mug of hot tea. Not even a great brand of hot tea, cheap stuff. $1.50 for a 3/8" thick slice of banana nut bread. And a few bucks for a Muffin. It doesn't cost anything for the hot water for tea. Maybe 5-10 cents for the bag, so profits are there for the owners.

Whatever you charge them they'll up it accordingly. But you should at least get 3 times what it costs for each cookie, muffin, brownie etc.

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MsTamara Posted 12 Feb 2006 , 12:11am
post #3 of 16

I have worked out my price per baked good and marked it up four times as a guide. It might not be a bad idea to check around to see how much the wholesale market bears in your area though. I am in the process of doing this myself.

HTH

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Loucinda Posted 12 Feb 2006 , 1:49am
post #4 of 16

I have done this and it was a pain. They never want to pay what the item is worth for you to sell, and then they don't give credit to you as it is. (they won't tell folks that YOU are the one making their pastries, they let them think they're made there or just won't say - if someone asks them they say......."we have a "supplier")

Maybe you will have better luck with that kind of arrangement than I did. They then wanted me to come and work for them there and make $8. an hour making the pastries I was selling them. I don't think so Scooter. icon_evil.gif

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Cakeman66 Posted 12 Feb 2006 , 2:10am
post #5 of 16

Just because you are selling wholesale, doesn't always mean your name has to be right out there. How often does an operator tell the customer, "oh, we by these pastries at Sams's".?

If you sell a product to another business knowing they will be re-selling it, then you've done your job, you've made you money already. Walk away and be happy you made a sale at all. I'd have no problem with my local shop telling customers that they "have a supplier". The bonus though, is that I know the owners and the staff, and they know my work. They would refer the customer to me, doesn't mean every shop owner would though.

Just because it doesn't work for one person, doesn't mean it won't for another.

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Loucinda Posted 12 Feb 2006 , 2:50am
post #6 of 16

You're correct - not a problem on things that are simple and who cares....scones, brownies, cookies and the like. My problem was that they wanted decorated nice cakes for clients and I feel that they should've given credit to me for those. I may be wrong, but in my heart, I felt that they should not take credit for those. (Flat out LYING about who made them.)

You are lucky you have a shop that refers the customers to you. Not many will do that IF they are taking the credit for your work, and making money doing it.

I stress this was MY circumstances, and I posted about it so that folks are aware of things that can and do happen. If you don't have a problem with someone taking credit for your hard work, that is fine.

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ge978 Posted 12 Feb 2006 , 3:09am
post #7 of 16

Mandze: You could figure out what you would charge retail & take off a certain percentage.

I sell my cakes & cheesecakes to area restaurants for a flat wholesale price & it works out nice. Just make sure you charge enough for you to cover your costs & make a decent profit.
Here's just an example:

Say you usually sold a cake that serves 12 people for $30..maybe you would make your discount 20% You would sell the cake to him for $24 & he would probably end up selling for $3 a slice- giving him a profit of $12 a cake & you would still make a good profit.

Or you retail brownies at $15/dozen, but wholesale them at $12 - He would probably sell them for $1.50/piece giving him a profit of $6

Hope this helps a little

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Loucinda Posted 12 Feb 2006 , 3:23am
post #8 of 16

Mandze (and others!) - I apologize for getting off topic there and ranting. I went back and read the posts and I should not have went off the deep end as I did (this all happened recently so the feelings are still raw).

You will do fine, charge what you feel is a fair price for your items. Don't underprice yourself though. It is your time that is going into the items.

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ge978 Posted 12 Feb 2006 , 3:33am
post #9 of 16

Quadcrew: I just took it as you had a bad experience with the wholesale and you were just trying to keep it from happening to someone else. That was really nice of you to apologize...we all have bad days.
I'm sorry the wholesale didn't work out for you...maybe there is a better opportunity around the door for you. Judging by your beautiful cakes maybe sooner or later.

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Loucinda Posted 12 Feb 2006 , 3:45am
post #10 of 16

Thank you for the kind words......

Does anyone have a way to figure out how much it costs us to fire up the stoves and bake something? That is something I have been wondering about and can't quite figure it out.

How often would you be providing product to him? Are they picking it up or are you delivering it?

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mandze Posted 12 Feb 2006 , 10:21pm
post #11 of 16

right now he is driving twice a week to pick up his goods from another supplier about 80 miles away and I would be much closer to him. So I am hoping he will also come pick them up from me. Otherwise there goes my profit.
So here is my example. Say if I figured out it costs me $6.00 to make 40 cookies. If I charge him so I make three times that it would be $24.00. Then I would make $18 and he would maybe resell them at $30 so he makes $6.00.
I guess since I don't know where he is buying from I can't figure out what he is paying now and don't really feel my place to ask him.
Opinions?

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BalloonWhisk Posted 13 Feb 2006 , 12:46am
post #12 of 16
Quote:
Quote:

Say if I figured out it costs me $6.00 to make 40 cookies. If I charge him so I make three times that it would be $24.00.




Not quite. You'd charge three times your costs, not your cost plus three times your cost. So if your costs are $6, you charge $18.

Quote:
Quote:

If I charge him so I make three times that it would be $24.00. Then I would make $18 and he would maybe resell them at $30 so he makes $6.00.




Good for you if you can get your customer to do this. I suspect that most retailers (and restaurants and cafes and etc) would want their costs to be a much smaller percentage of their retail prices.

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ncdessertdiva Posted 13 Feb 2006 , 12:56am
post #13 of 16

ge978, do you have any good cheesecake recipes? I have an opportunity to place cheesecakes in a local restaurant and I'm seeking a good chocolate cheesecake, turtle and raspberry white chocolate cheesecake recipes.
TIA!
Leslie

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ge978 Posted 13 Feb 2006 , 4:04am
post #14 of 16

Hi Leslie:

If you've read any of my posts on this board then you know that I don't usually follow recipes...I just throw things in a mixer & hope it comes out icon_lol.gif But, I will try to explain how I make my cheesecakes for you:

Plain Cheesecake

24 oz cream cheese
Little less than 1 cup of sugar

Cream these together on medium speed for about 15 min & bring the speed down lower to add:

milk(maybe 1/4 cup)
fresh brewed coffee(just 2-3 tablespoons)
make sure this is all well mixed & add:
4 eggs
beat until mixed(don't overbeat)

You can use your favorite crust...I use poundcake that I buy from SamsClub, break it into pieces and press it into the bottom of a springform pan
I bake in a convection oven @300 degrees for an hour...if its a regular oven I would do 325 - 350 for an hour

For chocolate I add hersheys cocoa powder & some choc. syrup
For candy cheesecakes I break up the candy bar in little pieces & add to the mix & then put a homemade whipped cream on top of the cheesecakes or do the plain cheesecake w/ the whipped topping & candy bar broken on top with choc & carmel syrup

Sorry I don't have exact measurements for you: I bake mostly by sight &add things until they look right

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Loucinda Posted 13 Feb 2006 , 4:21am
post #15 of 16

An FYI - most of the restaurants and coffee shops try to keep their food costs under 30%.

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ncdessertdiva Posted 13 Feb 2006 , 4:46pm
post #16 of 16

Thanks, ge978, I've decided to incorporate the additional ingredients needed for a chocolate cheesecake etc into my favorite cheesecake recipe so your information will be helpful!
Leslie

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