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How much to charge

post #1 of 6
7/19/12 at 6:23pm
Thread Starter 
Hi, I am new to the cake decorating business, I have to recreate this cake and I was wondering if I could get some insight on how much to charge.
LL
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post #2 of 6
7/20/12 at 10:20am
Have you already calculated how much you're spending on ingredients to make this cake?

If not, that would be step #1. Then also take in mind how long this may take you & the details. I'm pretty new to cake decorating too, so i'm learning things like this as i go. Hope this helps a little icon_rolleyes.gif

-Victoria J.
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post #3 of 6
7/20/12 at 3:35pm
The price also depends on where you are (what the market will bear), how much you pay yourself per hour for the time to make and decorate the cake, how much you add for overhead (electricity, water, insurance, etc.), and how much your profit will be.

Some figure out all of that and come up with a per-serving price (price of a cake changes depending on what size the cake is) plus extra for fondant/gumpaste figures/flowers.

I hope I die before "your" is the official contraction of "you are."

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I hope I die before "your" is the official contraction of "you are."

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post #4 of 6
7/21/12 at 1:58am
http://cakecentral.com/cake-decorating-ftopict-694973-.html
http://cakecentral.com/cake-decorating-ftopict-681084.html
http://cakecentral.com/cake-decorating-ftopict-708130.html
http://cakecentral.com/cake-decorating-ftopict-746435.html
http://cakecentral.com/cake-decorating-ftopict-746435.html
http://cakecentral.com/cake-decorating-ftopict-715658.html
http://cakecentral.com/cake-decorating-ftopict-710216.html
http://cakecentral.com/cake-decorating-ftopict-395683.html
http://cakecentral.com/cake-decorating-ftopict-709285.html
http://cakecentral.com/cake-decorating-ftopict-709674.html

A recommended guide:
http://www.cakeboss.com/PricingGuideline.aspx

If you look through these threads and countless others asking about pricing you will find the same basic information:

1, No one can tell you what to charge
2. You need to sit and figure out how much it costs you to make the cake (including other costs like insurance, licensing fees, overhead etc)
3. Determine how long it will take and how much your time is worth per hour
4. include a profit margin (some skip this)
5. the final number divided by the number of servings is your price per serving.

Some people compare the final number with comparable businesses in the area and adjust accordingly.
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post #5 of 6
7/21/12 at 11:58am
Hmmm...I noticed you put in brackets (some skip this) by adding on a profit margin. Very true. I just realized a lot of people in the cake world think their labour fee is their business profit! Very dangerous for the survival of a business. Glad you mentioned this because my cake friends told me they don't charge for labour hours. My 1st cake teacher didn't either. They use a mark-up and that is is. No wonder they struggle to re-invest and buy more tools and equipment for their business at home. Hope everyone can take a lesson of advice and charge for your time as well as add on a profit margin.
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post #6 of 6
7/21/12 at 12:49pm
Quote:
Originally Posted by Pearl645

Hmmm...I noticed you put in brackets (some skip this) by adding on a profit margin. Very true. I just realized a lot of people in the cake world think their labour fee is their business profit! Very dangerous for the survival of a business. Glad you mentioned this because my cake friends told me they don't charge for labour hours. My 1st cake teacher didn't either. They use a mark-up and that is is. No wonder they struggle to re-invest and buy more tools and equipment for their business at home. Hope everyone can take a lesson of advice and charge for your time as well as add on a profit margin.



When I first started I didn't know this either and thought labor counted as my profit. SMH.
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