I tend to make cakes as gifts.
Everyone RAVES about my cakes! Everyone LOVES them! Someone (who wouldn't know the cake was a gift) has an event or birthday coming up. How much do I charge? $1.00 per serving for basic buttercream. NEVER have I gotten an order after that!
I've been to events for which I was told previously that they wanted me to do the cake & sitting there is a cake in a Walmart or Meijer bakery box.
If I mention something, I usually get the response, "Oh! I forgot you do cakes!" Gee, thanks so much for telling me my cakes are so forgettable...
Wonderchic,
I'm not trying to berate or lecture you, but I do want to advise, you (and this is coming from someone who does not bake for a living)... you really need to price yourself higher than that, find a good quality you can live with and stick to it. If you are consistently charging what you are supposed to be charging, people will pay it and expect good quality. Take a look at the pro's and con's:
Selling for $1 a serving
Pros:
-Lots of orders
-Not a lot of stress for good quality... hey, quality of $1 can be lenient
Cons:
-Quite possibly being known as the "cheap cake lady"
-Not feeling food about having spent 10 hours in the kitchen to only come home with $50.
-compromising your quality
-compromising your talent... what you can do for the money and to earn money
Selling for a proper $2.50 per serving
Pros:
-Less orders, but those orders are people who value your ability and time
-More stress. Yes this is a Pro. Stress improves yourself and helps you better your skills. Working under stress to produce an excellent cake will "hone" your ability a lot faster than whipping out a $1 per serving sheet cake.
-not compromising your quality - making enough to be able to buy real vanilla extract, butter, better mixes or flours, etc..
-building your reputation on quality. Starting to get known as "the lady who makes really good cakes for very special occasions and isn't anything like the grocery store"
Cons:
-none. The cons have now turned into pros. 
Wonderchic,
I'm not trying to berate or lecture you, but I do want to advise, you (and this is coming from someone who does not bake for a living)... you really need to price yourself higher than that, find a good quality you can live with and stick to it. If you are consistently charging what you are supposed to be charging, people will pay it and expect good quality. Take a look at the pro's and con's:
Selling for $1 a serving
Pros:
-Lots of orders
-Not a lot of stress for good quality... hey, quality of $1 can be lenient
Cons:
-Quite possibly being known as the "cheap cake lady"
-Not feeling food about having spent 10 hours in the kitchen to only come home with $50.
-compromising your quality
-compromising your talent... what you can do for the money and to earn money
I COMPLETELY understand this! I believe it's true...except... I have had ZERO orders even at $1 per serving. Their eyeballs about pop out when I tell them simple round layer cakes (8"-10") start at about $25! 
I COMPLETELY understand this! I believe it's true...except... I have had ZERO orders even at $1 per serving. Their eyeballs about pop out when I tell them simple round layer cakes (8"-10") start at about $25!
I understand what you are saying, but you just need to market yourself differently. You have to start somewhere at building the right kind of customer:
-Have a portfolio on hand.
-Wear nice clean clothing and clean aprons. Smile!
-Carry yourself with pride.
-Have a handout with your pricing, flavors, fillings, etc...
-Present yourself as being "worth the money".
-Some people on CC have recommended having an open house tasting:
Bring sample cakes to local businesses or invite people over to a location for a few hours as an open house to see your work. Make small cakes with a pretty drop flower for your best cake flavors. Have small dabs of different icings on each piece, etc...
You have to work at setting yourself up as being worth the money, that's all. As someone else earlier said, "there are customers looking to buy a Pinto and then there are customers looking for a Porshe." Market yourself to be selling more than the Pinto... you can do it! 
I understand what you are saying, but you just need to market yourself differently. You have to start somewhere at building the right kind of customer:
-Have a portfolio on hand.
-Wear nice clean clothing and clean aprons. Smile!
-Carry yourself with pride.
-Have a handout with your pricing, flavors, fillings, etc...
-Present yourself as being "worth the money".
-Some people on CC have recommended having an open house tasting:
Bring sample cakes to local businesses or invite people over to a location for a few hours as an open house to see your work. Make small cakes with a pretty drop flower for your best cake flavors. Have small dabs of different icings on each piece, etc...
You have to work at setting yourself up as being worth the money, that's all. As someone else earlier said, "there are customers looking to buy a Pinto and then there are customers looking for a Porshe." Market yourself to be selling more than the Pinto... you can do it!
Those sound like WONDERFUL ideas! I would LOVE to do that! Oh, how I hate living in such a strict state. I'm so afraid to put myself out there because I don't have a commercial kitchen.
I've wondered if selling my stuff at the flea market bake-sale-style would be legal. The Amish here do it all the time.
I was also wondering how everyone is doing with the economy, is it reasonable to lower prices?
I don't believe this economy warrants a reason to lower cake prices. The economy was worse in the early '80s than it is now and cake prices held their own during that time and continued to increase at a normal rate mid-'80s.
I've noticed that wedding cake prices have typically increased around the same time within each decade, if you'd agree...
early '80s = $1.
early '90s = $2.50
early '00s = $4.
early '09 = $5.50 (+/- so far)
This depends on your area too. I'm in Ohio and there's no way anyone around here would pay $2.50 per serving for a single layer sheet cake. I run a legal home based bakery and the bakeries with storefronts that are in my immediate area start their wedding cakes at $2.50 - $2.75 per serving. I start my tier cakes at $2.50 per serving as well so I'm not undercutting anyone, but I would have a hard time explaining charging the same price for a single layer sheet cake as I charge for a torted tiered wedding cake
I'm not trying to argue what anyone's cake is worth so please don't think that. I just wanted to put it out there that not all areas are the same. I've done the research in my area and I don't think I could ever make it charging that much 
cakemaker30, I agree that they may be starting their tiered/wedding cakes at that level, but it's the everyday birthday/celebration cakes that are less than $1 in my area for the retail bakeries. I even have to compete (I use that term loosely; we all do different things as far as decorating goes, so not really competing with each other) with a few other home bakers that charge less than or at $1 per serving.
I'm working on a niche to set myself apart and I think that is what we all need to do. Focus on what makes you different. In times where price is the only thing that some people look at, you need to set yourself apart from the masses or deal with the lack of orders.
Focus on what makes you different. In times where price is the only thing that some people look at, you need to set yourself apart from the masses or deal with the lack of orders.
Good advice. Because if it was true that price is the only thing that people look at, we'd have nothing but McDonalds and Walmarts on every corner.
Michelle I'm in Akron so we're probably competing with the same people LOL I have a girl that does it out of her home a few blocks away from me that starts her wedding cakes at $1.50 per serving. It amazes me.
When you are talking about servings are you using the Wilton's serving guide? I use that on my site and often get a response like "those are small servings" or "that size would never really feed that many people." They aren't taking into account that the cake is 3 or 4 layers thick. I just wanted to make sure that I'm using the same serving size guide that everyone else has.
Thanks!
When you are talking about servings are you using the Wilton's serving guide? I use that on my site and often get a response like "those are small servings" or "that size would never really feed that many people." They aren't taking into account that the cake is 3 or 4 layers thick. I just wanted to make sure that I'm using the same serving size guide that everyone else has.
Thanks!
I made a sample cake for a friend at work. It was just like a real wedding tier 6 inch cake. She saw it and thought it would serve 4! 
I showed her how to cut the cake and proper serving sizes. She said no wonder half the cake usually goes in the trash when she cuts a cake, she is serving them way to much! 
It all goes to educating the customer on cutting the cake and not "up sizing" the serving.
I made a sample cake for a friend at work. It was just like a real wedding tier 6 inch cake. She saw it and thought it would serve 4!
I showed her how to cut the cake and proper serving sizes. She said no wonder half the cake usually goes in the trash when she cuts a cake, she is serving them way to much! It all goes to educating the customer on cutting the cake and not "up sizing" the serving.
For my husband...a 6" 2-layer cake...well...just give him a fork! The Dutch love their sweets around here! 
Michelle I'm in Akron so we're probably competing with the same people
LOL I have a girl that does it out of her home a few blocks away from me that starts her wedding cakes at $1.50 per serving. It amazes me.
Probably!
In that case, she is undercutting us, but she is right on target with the retail bakeries here.
I'm fine with someone charging $1.50 per serving. It's a personal decision and I can't make someone charge more if they deserve it, but I hope they realize they aren't making very much.
indydebi: I can't tell whether you are agreeing with me or not. In my city there practically are Walmarts and McDonalds on every corner. I am within 15 minutes of three Walmarts, about seven grocery stores with bakeries, and you don't even want to know how many McDonalds. It's sad really. Not all people look at price I agree, but I have told people what I can do for them to make their cake unique and diff from the grocery store, molded sugar decorations/etc., and it all comes down to price.
Something else that I've noticed it that brides-to-be want lots of pictures of cakes that I have already done. If I'm going to charge top dollar I need pictures. So my prices are around a dollar per serving for the larger tiers. When my prices were more I wasn't even getting any calls. So is it wrong to charge less while I'm trying to build my gallery?
If you start out charging very little, how will you be able to raise your prices. Your customers will be used to your low prices and may not want to pay.
@empower - that strategy (charging lower to build your gallery) does work if you plan it carefully, and focus it on weddings. I say focus on weddings because that is a one time client and they will not be comparing rates for wedding cake anytime soon after the wedding.
Offer the lower rates as "special. limited time pricing" or around something...like an end of year special. A gradual increase works in this case because it's the one time client. They won't know either way.
That is how I built my portfolio to gain pictures, references, and credibility. Party cake customers might be repeat clients....so it would be harder to increase rates.
In regard to CakeForte's idea, which I like, if you aren't doing wedding cakes you can still offer a limited time offer pricing, but make sure they know what the regular price is, either listed on your website or on their receipt, which you can do nicely with Cake Boss software.
Wow! I didn't realize the Cake Boss program was only $99! I remember when I did floral design at home & was researching programs. They STARTED at $500! I'm surely going to save up for Cake Boss! I'm sure it will show me what I NEED to be charging for my cakes!
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