Allergy Friendly Baking - Pricing Question
Business By Katherine1972 Updated 8 Mar 2017 , 6:48am by ypierce82
I recently started a home based allergy friendly baking business. I've been using the Bakenomics app to calculate pricing.
There is a big difference in my local competitor pricing and what I would have to charge. I even compared with pricing in other areas of the country and my prices are significantly more.
i.e average price for a 10" round retails for $52 but when I add up just the ingredient cost for MY 10" it's $38.86. Bakenomics adds in another $25.67 for labor. It says a $46.72 profit with a retail price of $111.25.
I understand a brick and mortar business doing higher volume probably has wholesale accounts for some of these specialty ingredients but this still seems like such a huge difference.
The other way I've read to figure your sale price is ingredient cost x 3, which brings it to $116.
what am I doing wrong here?
no you're good -- it's a niche product -- build it up -- you got this -- go for it --
best to you
But how if others doing allergy friendly cakes are charging half what I am?
They probably haven't properly priced out their ingredients, over head including electric, paper towels, etc. They also probably aren't paying themselves an hourly wage, either. My prices are higher than home bakers around me, but I'm not willing to work for pennies, and I have never priced using ingredients x3. By everything that I have read, that is definitely never the way to go. Let's say your ingredients are only 10 bucks. X3 is $30.00........I sell a dozen cupcakes for more than that. You have to know what YOUR costs are. Allergy friendly isn't cheap ingredients wise, at least here. Don't sell yourself short, and go for it!
But that's what I'm comparing. Other allergy friendly bakeries to mine. I'm not comparing to traditional bakery prices
Right. Your costs are probably different than theirs, and maybe they aren't making a profit, but IMO, I wouldn't be concerned about being at a higher price point. If you haven't already priced your recipes out, do that, and also read the other threads on here about pricing.
Yes I've priced using Bakenomics app. I'll search for more recommendations here...
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