Paul Bradford, a fabulous UK designer, has just started a blog where he will offer free videos each week.
His first video presentation is about how to present cake pricing options to a customer that comes into his shop.

He focuses on 3 different pricing levels for the customer's dream cake. Standard (2D), Middle with some bling and customization, and "Couture" for top end. This is well worth watching.

http://www.designer-cakes.com/2012/03/what-should-i-charge-for-cakes/

Thank you for sharing!!

Excellent post. Thank you!

Thanks for sharing!!!

You are all very welcome.

Okay, update. I tried it on a client... she ended up overwhelmed with the different tiers (and there were only 3 of them). I ended up having to back-track, and ask her what her budget was, and then presented her with what she could get (like I usually would've done) and we resolved things pretty quickly after that.

I have to agree with vgcea on this one. The three-tiered pricing structure is a wedding industry thing that's been going around for quite a while. Not just weddings, actually, they used it to sell us our vinyl siding too, but it's typical in weddings.

The theory is that people will generally go for the middle tier price, so that's where you should base your pricing. But in my experience, people appreciate fewer choices with pricing. As clients are becoming more educated about these pricing tricks they see through it, too.

I price cakes based on a flat price per cake, not a strict per-serving price, and I promote the fact that I don't nickel and dime people with extra charges added on for everything. The price covers any kind of decorations that the bride wants, so it's structured on the higher end to cover time-consuming desings, therefore simpler designs are just earning more profit because they take less time. The majority of cakes that brides want are fairly simple, so when one comes along that needs more attention it isn't a big deal because it's offset by the ones that are plainer. When they come to me they say "do you charge extra for this or that" and when I tell them no they're genuinely happy. Half the time they then complain to me that when they went to other bakers they were quoted extra charges for everything including the cake board.

The three-tiered structure can work, but you have to be a salesman to pitch it, and I'm not interested in that. I'd rather tell people that they have one price and they can have the flexibility of choosing whatever design they want and not having to worry about it. It tends to go over better.

I was in medical equipment sales for 30 years. His approach made perfect sense to me.

lol

I am finding "less is more" when it comes to providing information. I used to offer costings for everything, because I believe in full disclosure. But now I tend to give people an "upper cost limit" for a cake, and even though it might be the same price if I "nickel and dimed" them in an itemised quote, it is amazing how much happier someone is when they discover that I will deduct some $$$ for simpler elements etc. Intriguing shopper psychology!!

I just have a question out of curiosity. Does the general pricing for the simpler cakes that off set the cake of a more pricey cake still apply if it is extremely elaborate? For example, in general the basic white cake is what is asked for and they might get a little jazzy on an occasion, but what do you do when they want to have a cake the looks like Sylvia Weinstick, slathered in flowers? Does your general cake price still cover that?

I figured as much, but I guess for me there is no way my base could cover gumpaste flowers period, unless maybe it's like a 3 roses, which I can just knock out. But if I have 3 peonies or, I don't know, hydrangeas, I have to charge extra even if it is 3 bunches of hydrangeas. Does that fall under nickel and diming to you guys? I definitely wouldn't up charge for things like fondant quilting or stripes, that just makes no sense. But what about individual gumpaste pieces?