The owner has to pay rent and utilities, insurance, licensing fees, taxes, ingredients and supplies. So they're probably not making as much on the cake as you might think, in terms of pure profit.
WHat Texas_Rose said. But assuming all things are equal ......
The owner. Because if the baker or the decorator screw up and the bride complains, it's not the decorator or the baker who will taking money out of THEIR pocket to try to make it right for the bride. It's not the baker or decorator's name that is slammed in the world of public opinion ... it's "Debi at Debi's Bakery" who messed up their cake.
The person who takes the most risk earns the privilege of the most reward.
As I tell any employee who questions how I want things done: The day you write me a check for $100,000 to cover my investment, you can do things any dang way you want. Until you're willing to invest and risk your money, then it's my name, my money, my way. 
The pastry chefs who work for me all get paid hourly, and they always get their 40 hours, even if we are slow, so when the store is quiet and there aren't a lot of orders, I lose money, but the girls still get their checks. When we are busy, they really hustle for the same hourly rate, and so I make more than they do. It's not a one by one situation. I make sure they can always pay their bills, and to do that, I need to be a profitable, successful business.
First, I wouldn't pay a decorator that way. A lousy $100 birthday cake can take the same, if not more time than a 4 tier cake for 200 that will bring in $700. 40% commission would be way out of line, but even with that a baker/decorator isn't going to want to work 4-5 hours for only forty bucks, before taxes, on a birthday cake. (I'm including baking, icing, decorating, clean up, based on various threads in CC about how long it takes to do intricate birthday cakes).
As is mentioned on here frequently, the biggest cost of the cake is the time involved, so it's only logical to pay for the time involved, i.e. hourly rate.
Commission is usually paid for a sales transaction, not for labor.
If a decorator wants a cut of the total price, I say invest in the business and become a partial owner.
Does the owner also work in the bakery? I don't think the owner should earn more from the cake than the cake decorator/baker if they don't actually work there...if they're simply(and I don't mean simply as in it's a simple thing to own a bakery) the owner.
If the owner also worked at the bakery I would say it would depend on the skill level of both of them. and...it would only be figured using the profit minus the amount to help grow the business ...not the actual sale.
I don't think that there's one answer that would fit every situation...
Does the owner also work in the bakery? I don't think the owner should earn more from the cake than the cake decorator/baker if they don't actually work there...
Define "earn". The difference between the price of the cake and what the decorator makes is not what the shop owner "earns". The shop owner must also take out of that price all of the expenses involved in making that cake, which is much much more than the cost of flour and eggs.
Perhaps the owner isn't working in the kitchen, but perhaps the owner is working at networking and selling and talking to people to bring in the business that enables the decorator to have a job. Doesnt that not count as "work" in the business? Just because they're not in the bakery/shop, doesn't mean they aren't "working" just as much or just as hard or contributing just as much.
It's kinda of like saying a stock holder shouldn't make any money on their investment if they don't actually work at the business.
Some people invest money, some invest time. The operation doesn't function without both.
To try to help with the original question, there are lots of factors, such as what part of the country, skill level, reputation of the bakery (high end or "regular" cakes), etc. I believe that you get what you pay for, so if I were to hire a decorator, I'd expect to get someone in the skill range that merited a $12-$15/hour range.
But even if the owner didn't do actual work in the bakery, it is still their overhead and advertising that allow for the cakes to be made. Their investment, their majority profit.
As a former massage therapist I can tell you most owners of spas or other massage businesses don't actually do massage but they keep a majority of the fee. It's just accepted that is the way it goes unless you work for yourself. (So tip your massage therapists, it's greatly appreciated!)
Indydeb said it better than me. And I don't own a business.
it would only be figured using the profit minus the amount to help grow the business
No...no... I was saying that if there is a question as to who should get more from the cake produced that it should only be the amount of the profits minus the amount put toward the growth of the store. that would be after everything else is paid EXCEPT FOR THE DECORATOR/BAKER who wants to question why they make what they make...
I did say figured on the profit...
yes...I understand why the owner would neeeeeeeeed to keep most of the monies from the sale of the goods but if you have a decorator/baker who wants to think they deserve more....after breakdown...if they both don't work in the bakery, the decorator/baker actually does earn more...off the actual profits.
aaaaaaaaaand...I also know, first hand, of owners who've used their cake decorator/baker's acheivements to boost sales and attention at the bakery....didn't help anyone but the owner...who, herself, didn't know how to bake, much less how to decorate. sooooooooo...there are times, when I'd agree that the decorator DESERVES 100% of the profit (minus the amount put toward future growth of the bakery) from every cake he/she produces.
well, the decorator/baker would not have a job if it were not for the OWNER! SO, to me that answers the question..the owner should make more weather they work in the kitchen or not. If the decorator/baker can make it so well on their own, then they should open their own shop.
IMHO
yep, you're right! but then there are times when an owner only becomes an owner because of they see they can market someone's talents....
hell...even a pimp gets more than the prostitute he flaunts, eh?
Actually, the owner is the person with the vision, the capital, and the commitment to make a business run. They assume all the risk, all the headaches, all the liability, and, oh yeah, they deal with the nut jobs so that decorators can hang out and play with cake all day.
My job was SOOOOO much easier when I was the just the pastry chef. Now I work twice as many hours doing things I hate ( like taxes and payroll) as opposed to baking and designing cakes, which is fun and incredibly easy in comparison.
And wow!!... I would fire one of my girls if she ever said anything like that.
Dang! Not all owners of businesses do all that! Some, have the money and they happen to get together with someone who has talent...and together, "hey, I know...let's open a bakery! with my money and your talent, we'll make a killin'!" while money bags puts up the money, the other person brings forth the recipes, the skills, the talent aaaaaaaaaaaaaaaand the following....it's not a 50/50 partnership....it ain't much more than a pimp puttin new clothes on fresh hooker...."I'll provide the bakery(a whole new wardrobe) and you can bake and decorate your heart out (you can do what you do best for big daddy!).
Not even did money bags do the books, the ordering, the order taking, the, the, the, the anything ...heck! this one didn't even know what recipes were being used...what brands they were using, or what items were gotten from what source...until, the hooker done slip through big daddy's hands and went back home to mama.
I'll say it again, there ain't one good answer for every sit-chee-a-shun. But I think that an amount should be agreed upon beforehand and that no one should know what the other makes.
Thanks everyone! I am trying to get information to help out a friend opening a bakery and bistro. I will be on call for doing specialty cakes. My hours will be on an "as needed" basis for weddings, birthdays, etc. It is almost like I am renting her kitchen, but I will be bring in customers that may stay for lunch as well. 
This is so new to me, and her as well, so I want everything to be fare and "win/win" for both of us.
I just wanted to put in my .02 on this one. If an owner is making less money than their employees then they don't have any reason to be in business for themselves. Why not remove all the risk and responsibility and just go work for someone else if you could make more money. That's why people open their own businesses so they can make more money and they can be in charge. So if they choose to collect the bulk of the profit for themselves and sit on their butt all day and eat cake instead of making it then they can because their name is the one that's on everything there. If their employees don't like it they are free to go somewhere else and work. I will say though that most small business owners don't have that luxury because there is just too much work to do and a lot of the work that they do is behind the scenes that employees don't see. So when their in their office and employees think they're just sitting in there, there's a pretty good chance that isn't what's happening. If I wanted to sit on my butt and do nothing I could just stay at home and let my employees run my shop
I say the owner..I dont own a shop, and I dont want too!
Owning a shop means, dealing with brides, dealing with buying supplies, dealing with
employes, paying the utilities, dealing with deliveries and all the things that can go wrong. I go do my work and get out..Even though I do my best work, I dont have to worry about anything else..
Now...between a manager/sales person and a decorator I feel totally different..
Edna 
Bethroze, in your case since you are not hourly or salaried and only as needed for specialty cakes, you should get a percentage, and a large one if it is all your labor and customers.
Good luck at the new bakery, hope you are successful!
Bethroze, in your case since you are not hourly or salaried and only as needed for specialty cakes, you should get a percentage, and a large one if it is all your labor and customers.
Good luck at the new bakery, hope you are successful!
It also depends on who is furnishing the supplies - you or her? Are you bringing all of your own equipment with the exception of mixer and oven? It sounds like you are more of a "sub contractor" which is entirely different then an employee.
I'm hoping to empty my kitchen of all things cake. She did buy out a bakery that went bust a few months ago and has everything stored in a warehouse here in town. I get to go in and set up my work space with probably a combo of hers and mine, but she will be providing all ingredients.
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