## Pricing

By Lorabell Updated 17 Jul 2010 , 1:39am by fishabel

Lorabell Posted 16 Jul 2010 , 6:20pm
post #1 of 6

Ok, I'm really unsure as what to do about this. Pricing.......I know many people charge by the slice. Someone please tell me the correct way to do this and how. I read the topic by Erlene Moore who says to charge by the slice and then add to that amount as you develop your skills. Please give me some insight on this subject. Thanks,

Lori

5 replies
mamawrobin Posted 16 Jul 2010 , 7:12pm
post #2 of 6

Most people charge by the serving. I also agree that skill level is a very important factor when determining the price. In my opinion the quality of work is just as important as the cost of ingredients and the cost of producing the cake when determining your prices. The average cost in your area is also something to consider.

indydebi Posted 16 Jul 2010 , 7:36pm
post #3 of 6

It's almost a matter of semantics. A 'charge by the slice" is just a breakdown for easier math and pricing of a whole cake. Some on here say, "I don't charge by the slice .... I charge by the cake." Yeah, true, but all you have to do is take the total cake price divided by the number of servings the cake is designed to serve and wha-LAH! you have a per-slice price.

Having a pre-determined per-slice price just enables you, the baker, to be able to quickly and easily come up with a (general or precise) price for a cake. The baker doesn't have to start from scratch to figure the price of a cake each and every time. It's also easy for a bride/client to know immediately if the cake is in their budget ..... 100 guests at \$3.50 a slice or at \$6.00 a slice helps the bride determine her budget.

fishabel Posted 17 Jul 2010 , 12:50am
post #4 of 6

I would also say that price depends very much on your overheads. I use as a rule of thumb x3 of the cost of the ingredients. That covers cost and labour and power baking and putting it together. Once you have your cake covered and stacked add the time it takes to add the final touches. What are you worth per hour.

indydebi Posted 17 Jul 2010 , 1:11am
post #5 of 6
Quote:
Originally Posted by fishabel

I would also say that price depends very much on your overheads. I use as a rule of thumb x3 of the cost of the ingredients. That covers cost and labour and power baking and putting it together.

Uh.....no it doesn't.

I have in front of me a catalog from Sam's CLub which has a page for "foodservice" tips. One of them includes pricing. They state, and I quote:

"Simple Factoring - Multiply the cost of ingredient by three (this method does not include labor or other costs)."

My cost for making a wedding cake for 100 is about \$35. If I sold that cake for \$105 ..... \$1.05/serving ...... every person on here would jump down my throat for undercutting everyone. Not to mention that I would have gone bankrupt in about 3 months pricing cakes like that. Shop or not, \$1.05/serving for wedding cake is nuts!!!

Here's a thread where a CC'er did the times-3 AND she figured her actual labor cost based on the hours it took her. As I state in this thread, if she had to write a check for the labor, based on the 'time 3', she would have an income of \$150 and expenses of \$300. http://cakecentral.com/modules.php?name=Forums&file=viewtopic&p=6475557#6475557

An income that is less-than-expenses equals .... well, just do that math. It ain't hard to figure where you'll end up.

Here's one where I compare the costs of selling spatulas vs. selling an item that has value-added labor (page 11 of the thread): http://cakecentral.com/modules.php?name=Forums&file=viewtopic&t=664395&postdays=0&postorder=asc&highlight=spatulas&&start=150

There are paid professionals who do what is called Full Funtional Cost Analysis. THey make a profession out of determining costs, expenses, overhead and what the selling price should be. Do we really think colleges prepare people on how to do this kind of work and these pricing experts get the fees they get if it was as simple as "oh, just take it times 3!"

fishabel Posted 17 Jul 2010 , 1:39am
post #6 of 6

x3 is just the beginning. The very basic cake. You have to know what you are worth as well. I always add on my time, wires, cutouts, figurines etc. You would definately loose out if all you did was x3.

Quote by @%username% on %date%

%body%