Pricing In My Bakery

Business By texascakemomma Updated 23 Sep 2011 , 3:30am by scp1127

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texascakemomma Posted 21 Sep 2011 , 4:03pm
post #1 of 12

My biz partner and I opened our shop at the end of June. In our business plan and financial models, we priced our cupcakes at $2.50 for a standard sized cupcake with buttercream and a garnish or sprinkles. We based this on the other cupcake shops in our city. I bake them so that they "dome" without spilling out of the cup. We did a couple of "half-off" deals and have gotten some really snarky comments back from unhappy customers, stating that our cupcakes are too small for the price. That being said, we are entertaining lowering our prices to $2 per standard sized cupcake.
Also, we are not just a cupcake shop.....we make miniature and full sized pies, custom cakes, cookies, brownies, etc......when we do have a variety of baked goods out on display, our customers comment "why don't you have more cupcakes?" But, if we have, say 4-5 flavors of cupcakes and 2 cakeball choices, we also get "is this all you have?"
I know business is business and I do have a thick skin, but I want my customers to come back! Has anyone else dealt with pricing changes and have any tips?
Thanks so much icon_smile.gif

11 replies
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mplaidgirl2 Posted 21 Sep 2011 , 4:17pm
post #2 of 12

$2.50 is pretty standard... And if you see thats the price in your area I wouldn't budge. Depending on your hours maybe make the last hour your open $2 instead of $2.50. Or make it if they order a 1/2 dozen they are $2.25 and at a dozen they are $2. Don't sell yourself short

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mplaidgirl2 Posted 21 Sep 2011 , 4:19pm
post #3 of 12

ps... Here in Manhattan there are shops that get $3.50 for ragular sixed cupcakes...
Theres even a place that sells only minis and gets $2.25! insane!

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ConfectionsCC Posted 21 Sep 2011 , 4:21pm
post #4 of 12

I know how ya feel, I own a home bakery, not store front, so I do not have any items just ready to sell, everything is made to order. For that reason, I have a minimum order of 12 cupcakes, and no quantity discounts (I may only charge $30 if an order adds up to say $32.50 and tell them that) Some people don't mind it, some people are just like "why don't you offer them by the dozen like so and so's bakery??" Don't let it bother you, I am sure you are not the only one in town with those comments, and people that like your stuff WILL come back, the last thing you want to do is cater to the "bargain hunters" Bending over backwards for them will make you go bankrupt!! Cater to the people who love your stuff and are willing to pay for a great treat icon_biggrin.gif HTH

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Ashleyssweetdesigns Posted 21 Sep 2011 , 4:24pm
post #5 of 12

Yeah definitely dont change your price! Some people are just flat out rude. You will find loyal customers that will pay your prices. If it's delicious they will come back.

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sillywabbitz Posted 21 Sep 2011 , 4:26pm
post #6 of 12

Congrats on your shop! I'm not sure of your area but in Dallas that is about the right price for a basic cupcake considering the cupcakes I've seen at various cake and cupcake shops.

As a customer, my question would be what makes your cupcakes special to a buyer. In Dallas there is a place called Gigi's. I believe it's a franchise or chain but they do two things that really stands out....a large variety of flavors and this crazy tall swirl of frosting. Honestly I think it's too much frosting but it is their "thing". If your cupcake is just a plain cupcake with a standard buttercream, then I think people will be less jazzed. I would almost recommend you keep your choices small (4-5 like you are) but make the flavors really stand out. Then they're paying for something special. If you do that you may even need to up your price per cupcake but to me paying extra for amazing is better than paying normal for normal. Please keep in mind this email is without knowing anything about your business, flavors or pricing model. Just some thougts based on what you posted.

Good luck with your businessicon_smile.gif

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jason_kraft Posted 21 Sep 2011 , 6:13pm
post #7 of 12

How much does it cost you to make a dozen cupcakes, including ingredients, labor, and overhead?

You'll also want to look at who you are targeting with your retail shop. Many customers who are looking for cupcakes have gotten used to specialty cupcake shops that offer a wide variety of different flavors, so if you only have a few flavors you won't compare favorably.

Also I will echo sillywabbitz' comment about what makes your cupcakes (or any of your products) special. You need to finish the sentence: "Customers will come to my shop and buy my products because ________ "...once you have your competitive advantage identified you will have a better idea of how to market yourself.

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btrsktch Posted 21 Sep 2011 , 9:14pm
post #8 of 12

I would also ask WHY are they asking is that all you have. You should be eliciting feedback directly from your customers to see what they are thinking and feeling about your product before they get it and after they eat it. If you are not getting direct responses, use a suggestion box. The goal should be to learn your market and target yourself around that.

I would not do a straight $.50 price drop. That is huge and lets your customers know that you don't know what you are doing. Instead, change what you can. I.e. invest in bigger cupcake liners, or cupcake pans. Or, as suggested earlier, increase the icing. Or change the look and details - add extra stuff! Candy, sprinkles, sugar, chocolate.

What you should definitely do is change your product to meet your percieved value of price point, but don't ever change your prices.

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scp1127 Posted 22 Sep 2011 , 12:28pm
post #9 of 12

Have you bought and tasted every competitors' products and done a price analysis compared to your product? If you did not do this before you opened, you may not be priced correctly in your market.

If some little bakery didn't have a big variety but had great tasting products, I would go there. If the product is incredible, consumers understand the concept of small batch artisan baking. But if they are no better than the next shop with more variety, or they are overpriced because of taste, then the price or the quality must be adjusted.

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Caseys Posted 22 Sep 2011 , 12:48pm
post #10 of 12

omg that is a super deal for cupcakes if you campare that to a grocery store like where i live there are not many speciality bakeries just in the local grocery store cupcakes with sprinkles 6 cost $3.89 or .65 a piece!!!

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texascakemomma Posted 22 Sep 2011 , 6:46pm
post #11 of 12

Thanks for all of your input! We have tried our competitor's cupcakes. To be more specific, we are priced the same for cupcakes as the closest cupcake shop to us.....they have a great customer base. We have heard from multiple people that their icing is bland and the same icing on each cupcake. We are doing the standard cupcake size, a big swirly pile of buttercream, garnish and a lot of our cupcakes are filled or coated with ganache under the buttercream. We are looking at a taller cupcake liner to hopefully increase the size of our cupcakes without lowering our prices. It's an experiment for sure so I will post an update after we have done a few batches of those and gotten some customer feedback. Thanks again!

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scp1127 Posted 23 Sep 2011 , 3:30am
post #12 of 12

texas, pm me about the size issue. I'm glad that you have tried your competitors' products. Most every time I ask this, the poster has not tried the competition. But isn't it amazing that all types of cupcakes sell? Even the ones that aren't so good.

It sounds like you just need to get your products in more mouths. If you have a great product and you are priced right, you need more customers. Just like with any business, you need to go to them if they aren't coming to you fast enough. Word-of-mouth spreads with a great tasting product. If you are priced right, take that out of the equation. Get some samples out there in your target income market. You will be fine.

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