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delivery fees

post #1 of 27
Thread Starter 
I have mostly been making cakes for local clients or family so I have always just delivered for free. In the last 2 days, I have had requests from 2 different people who want to order cakes that will have to be delivered to a town that is 75 miles away. With gas being so high right now there is no way I can delivery them for free. Does anyone have any advice on what I should charge for a delivery fee?
post #2 of 27
I go by the IRS mileage rate, which is currently 55.5 cents per mile, so $1.11/ roundtrip mile.

Rae
I love you, but your emergency is not my crisis!

They say that a little knowledge is a dangerous thing, but it is not one half so bad as a lot of ignorance.--Terry Pratchett (b.194
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I love you, but your emergency is not my crisis!

They say that a little knowledge is a dangerous thing, but it is not one half so bad as a lot of ignorance.--Terry Pratchett (b.194
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post #3 of 27
In town my delivery fee was $50. That's 2 miles of 25. After 25 miles one way, it's $1 per mile, each way.
Answers to the most often asked questions re: SPS. SPS instructions are on Page 15 of the Sticky at the top of the Cake Decorating Forum. Supplies can be ordered from Oasis Supply, Global or BakeryCrafts.
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Answers to the most often asked questions re: SPS. SPS instructions are on Page 15 of the Sticky at the top of the Cake Decorating Forum. Supplies can be ordered from Oasis Supply, Global or BakeryCrafts.
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post #4 of 27
We charge $1/minute round trip according to Google Maps estimates. So if that 75 mile trip takes 90 minutes, we would charge $180 for delivery. This covers your time, fuel, and depreciation on your vehicle (IRS mileage reimbursement only covers fuel and depreciation).
post #5 of 27
Quote:
Originally Posted by jason_kraft

We charge $1/minute round trip according to Google Maps estimates. So if that 75 mile trip takes 90 minutes, we would charge $180 for delivery. This covers your time, fuel, and depreciation on your vehicle (IRS mileage reimbursement only covers fuel and depreciation).



OMG! Just tell me that you don't want to deliver it and be done with it!

NOBODY will ever extract a $60/HOUR delivery fee out of me--I don't care WHAT they make. I'd do without before I'd every pay that type of fee.

I consider my time VERY valuable, but if offered this option I'd either pick it up or not buy it--no matter how bad it was on the 405.

But then again, I'm a real shopper. Many people aren't--they just cave in and don't know how to express their disbelief and walk away..............sadly.

JMHO
Rae
I love you, but your emergency is not my crisis!

They say that a little knowledge is a dangerous thing, but it is not one half so bad as a lot of ignorance.--Terry Pratchett (b.194
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I love you, but your emergency is not my crisis!

They say that a little knowledge is a dangerous thing, but it is not one half so bad as a lot of ignorance.--Terry Pratchett (b.194
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post #6 of 27
Quote:
Originally Posted by BlakesCakes

Just tell me that you don't want to deliver it and be done with it!


That's exactly what we're doing. The delivery fee is on the high side to encourage more pickups, which are a far more efficient use of our time and incur significantly less opportunity cost. It helps that we are local to some extremely affluent areas (Silicon Valley) and have a significant competitive advantage in our target market (people with food allergies).

We also deliver cakes to businesses for office parties, seems like every other month we make a delivery to the Googleplex (about 30 minutes each way) and Google has no problem paying the delivery fee.

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I consider my time VERY valuable, but if offered this option I'd either pick it up or not buy it--no matter how bad it was on the 405.


Believe it or not, some people consider their time more valuable than $60/hour, and those are the people who agree to the delivery. Since most of our orders are small cakes we don't deliver too often, I'd say about 5-10% of our orders are delivered, some as far away as SF (which costs $150 or so for delivery). Then again, there are about a million customers within a 20 minute drive so the delivery fee is usually in the $20-40 range.
post #7 of 27
I don't offer delivery unless it is three tiers or more.

I don't charge enough for my time so I am fo no help icon_sad.gif
post #8 of 27
Thread Starter 
Thanks for all of the suggestions. I live in a small town so it is no big deal for me to continue to delivery locally for free. I think I will go with the IRS mileage and charge round trip. If they don't want to pay it then they can just pick it up or not order. I don't have a problem staying busy with local clients anyway!
post #9 of 27
The IRS mileage rate pays you nothing for your time. Your time to drive miles is worth nothing to you? You couldn't be making another cake? Spending time with your family? Heck, even sleeping??
post #10 of 27
Quote:
Originally Posted by jason_kraft

Quote:
Originally Posted by BlakesCakes

Just tell me that you don't want to deliver it and be done with it!


That's exactly what we're doing.



You know, I thought about it and I even went to the current website to see if the person who took over your business gave any hints about the scope of their delivery charges---no, they don't, so I don't know if they've continued your pattern.

Perhaps when you held the business you had the $60/hr. delivery fee clearly stated on the website?????

I doubt that I'm the only person to have such a strong gut reaction to $60/hr. for delivery and I'd bet that if that number was posted, many people considering delivery would never inquire.

To me, reading, "we can deliver for an extra charge" doesn't conjure up a fee higher than what I pay my plumber for a house call.......

I really admire businesses who have the courage to display their exact delivery charges. I prefer to be allowed to make that choice before I've committed to an order.

Rae
I love you, but your emergency is not my crisis!

They say that a little knowledge is a dangerous thing, but it is not one half so bad as a lot of ignorance.--Terry Pratchett (b.194
Reply
I love you, but your emergency is not my crisis!

They say that a little knowledge is a dangerous thing, but it is not one half so bad as a lot of ignorance.--Terry Pratchett (b.194
Reply
post #11 of 27
Quote:
Originally Posted by BlakesCakes

Perhaps when you held the business you had the $60/hr. delivery fee clearly stated on the website?????


We did not include a specific delivery charge on the web site. There's no reason to include the formula for how we calculate delivery, just as we don't need to specify the hourly wage we use to price our products or how much the per-order overhead allocation is.

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I prefer to be allowed to make that choice before I've committed to an order.


Of course customers are allowed to choose whether or not they want their order delivered before they commit to an order. When they contact us, we ask if they would like pickup or delivery, and if they want delivery we quote a specific delivery charge based on how far the delivery address is from our kitchen. As I said above this delivery charge is usually in the $20-40 range.
post #12 of 27
So you asked them about delivery and specified the likely cost BEFORE they had created an order, so that they could factor that extra cost into their planning?

Before they had even mentally committed to purchasing from you?

Or when they said, "I see that you deliver." you immediately volunteered the delivery formula before proceeding--- so that they would be making a fully informed decision about costs and not be surprised at the end run when they asked about the delivery charges and found that it now put them significantly over budget?

I'm saying that the discussion of such a significant charge--whether you want to disclose it as a courtesy to a customer, or not--needs to be transparent from the beginning and NOT added on as an expensive "afterthought".

Rae
I love you, but your emergency is not my crisis!

They say that a little knowledge is a dangerous thing, but it is not one half so bad as a lot of ignorance.--Terry Pratchett (b.194
Reply
I love you, but your emergency is not my crisis!

They say that a little knowledge is a dangerous thing, but it is not one half so bad as a lot of ignorance.--Terry Pratchett (b.194
Reply
post #13 of 27
Quote:
Originally Posted by BlakesCakes

So you asked them about delivery and specified the likely cost BEFORE they had created an order, so that they could factor that extra cost into their planning?


Yes, an order is not considered placed until all the components of the order are finalized and an invoice is created. If they contact us in advance and ask how much delivery costs to their address, we are happy to tell them.

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Before they had even mentally committed to purchasing from you?


I'm not sure what that means. If a customer is "mentally committed" to purchasing from us and the delivery charge is over their budget, they would just pick it up.

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Or when they said, "I see that you deliver." you immediately volunteered the delivery formula before proceeding--- so that they would be making a fully informed decision about costs and not be surprised at the end run when they asked about the delivery charges and found that it now put them significantly over budget?


We always ask whether the customer wants pickup or delivery. If they want delivery, they tell us where they want it delivered and we quote them a delivery price for their address (not the formula). There's no "end run" involved.

Sometimes customers who live far away from us are surprised at the cost of delivery. If they state this outright or attempt to negotiate I simply say that the delivery cost is based on the distance from our commercial kitchen, customers understand this and either pay the delivery cost or pick it up themselves. More often customers are surprised that we deliver in the first place, since most bakeries catering to the midrange market don't.

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I'm saying that the discussion of such a significant charge--whether you want to disclose it as a courtesy to a customer, or not--needs to be transparent from the beginning and NOT added on as an expensive "afterthought".


I disagree both that the delivery charge is significant (it is usually relatively small, and delivery itself is a nice-to-have and can be skipped) and that 100% transparency is necessary in this regard. We also don't include prices for every potential upcharge for premium flavors or custom designs, since it will vary from order to order.

As you can personally attest to, seeing a formula of $60/hour or $1/minute can be upsetting to some people, but in congested metro areas charging based on time is more fair than by distance. In some areas it can take 20 minutes to travel 5 miles, and charging $4/mile wouldn't be fair to people living in less congested areas.
post #14 of 27
I charge $175 to drive to the next main town, which is about 50 miles from my bakery. Total delivery time round trip is around 2 hours, so $87.50/hour. Yes this is posted on my website. Don't want to pay that? Don't have your cake delivered.

I think people like to rail against Jason just because he's Jason.
post #15 of 27
Oh, Jason, you work so damn hard to not understand anything I say........

If, as the customer, I take the time to find your business, peruse your offerings, decide on what I want to order (mentally commit), and consider delivery as a real option, I don't want to go thru any part of the process with you only to find out that the cost of delivery is way beyond what I consider reasonable. That's a waste of my time.

You may not be able to anticipate every "extra" that someone may request, although many reputable bakeries will note $ ranges for certain common things, but if you know what you charge for delivery, I really do think that should be disclosed on the website or at the outset of an order inquiry.

Basically, to get my business, tell me everything you can at the OUTSET of the process that will allow me to make an informed decision about how I'll be spending my money.

Rae
I love you, but your emergency is not my crisis!

They say that a little knowledge is a dangerous thing, but it is not one half so bad as a lot of ignorance.--Terry Pratchett (b.194
Reply
I love you, but your emergency is not my crisis!

They say that a little knowledge is a dangerous thing, but it is not one half so bad as a lot of ignorance.--Terry Pratchett (b.194
Reply
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