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A Serious & Rational discussion about Pricing  

post #1 of 115
Thread Starter 

I'm sure, at some point, this post will get lost in the archives, but it's worth a shot.  I really do like to help people.  I believe that knowledge is power.

 

Most of us agree that tossing a number at someone, who asks how to price a cake, does them a disservice.  I'm in the teach a man to fish boat so to speak.

 

Here is my heartfelt and knowledgeable advice.  In order to set your pricing, you really do have to do your homework.  Sit down & write a list of every single thing your hands touched while making that last cake.  Did you use a hand towel?  Do you have to wash that towel?  Aprons, hand soap, dishwasher, dish soap, oven, water, trash can....EVERY single thing no matter how small it may seem.  Of course, you will also add the cost of ingredients.  If you are a legal business, you will need to add the cost of licensing and insurance.  This should, quite frankly, be a very very long list.  

 

You should also do some research into your competition.  Found someone with comparable skills as yours and check to see how much they charge.  Don't copy this!!  It's possible they are not charging correctly.  It will, however, give you valuable information in comparing.

 

Some people will encourage you that home bakers or Cottage Food Law bakers shouldn't charge the same as a brick & mortar bakery.  Really?  My question is do you have the same costs?  Sure, you don't have the same lease payments.  You also don't get the discounts of purchasing power.  I'm not saying they equal out.  The only way to know is to have an accurate accounting of your true cost.

 

Remember that the goal is to make a profit.  Covering costs does not equate to a successful business.  Sure you want to make people happy, you want them to enjoy your cake.  As a business, you should also make a profit.  We aren't talking price gouging, but you really do deserve to make a profit.  Stop feeling guilty about it!

 

You don't have to have a masters in business, but I do recommend you at least have a business plan.  At the very least, educate yourself about the true costs of producing your cake.

 

I also think it is a good idea to show the diversity of the different areas.  Cost of ingredients, skill level, & location vary all across the globe.

 

We were once able to share in a wonderful thread where people took turns stating how much they would charge for a cake.  I'd like to try that.  My next post will be the guidelines for participation.  I hope you all will join me.  

www.VeryDeliciousDesserts.com

https://www.facebook.com/pages/Delicious-Desserts/207874222593145

 

It's never "just cake!"

 

You may get a cake for $way to little but you won't get this cake!

Animal
(4 photos)
 

www.VeryDeliciousDesserts.com

https://www.facebook.com/pages/Delicious-Desserts/207874222593145

 

It's never "just cake!"

 

You may get a cake for $way to little but you won't get this cake!

Animal
(4 photos)
 
post #2 of 115
Thread Starter 

Guidelines:

 

1.  This is to gain perspective on the ranges people charge throughout the world.This is not an opportunity for someone to tell anyone else what they "should" charge.  Please don't post with that intent.  I have no pull, but I will ask a Mod to delete it.

 

2. Be specific about the details.  We will need to know size, flavor, & filling

 

3. Costs should not include tax or delivery

 

4. Allow at least 5 responses before adding a new cake.  The whole point is to gain perspective of the variations in cost.

 

5. Be nice & be fun.  This really can work.

www.VeryDeliciousDesserts.com

https://www.facebook.com/pages/Delicious-Desserts/207874222593145

 

It's never "just cake!"

 

You may get a cake for $way to little but you won't get this cake!

Animal
(4 photos)
 

www.VeryDeliciousDesserts.com

https://www.facebook.com/pages/Delicious-Desserts/207874222593145

 

It's never "just cake!"

 

You may get a cake for $way to little but you won't get this cake!

Animal
(4 photos)
 
post #3 of 115
Thread Starter 

I will start the discussion with this recent cake:  

 

 

700

 

In reality, the cake was a dummy cake made for a photo shoot for Charleston Weddings Magazine.  It is a 6" four layer, 8" six layer, & 12" five layer.  The listed flavor for all tiers was White Vanilla with layers of chocolate ganache, mocha buttercream, and white chocolate mousse.

 

All tiers are covered with fondant.  The stripes are fondant, and the flower is a mix of fondant & gumpaste.  The flower was edged with gold luster airbrush.

 

I would have charged a client about $740 for this cake before tax & delivery

www.VeryDeliciousDesserts.com

https://www.facebook.com/pages/Delicious-Desserts/207874222593145

 

It's never "just cake!"

 

You may get a cake for $way to little but you won't get this cake!

Animal
(4 photos)
 

www.VeryDeliciousDesserts.com

https://www.facebook.com/pages/Delicious-Desserts/207874222593145

 

It's never "just cake!"

 

You may get a cake for $way to little but you won't get this cake!

Animal
(4 photos)
 
post #4 of 115

Awesome DD...This will be fun....also to show how different cost of living areas vary.   I would probably charge $575. 

Debbie - US Army (Retired) --aka "The Cake Sarge"

Good Cake Ain't Cheap! Cheap Cake Ain't Good!
Debbie - US Army (Retired) --aka "The Cake Sarge"

Good Cake Ain't Cheap! Cheap Cake Ain't Good!
post #5 of 115

In our area that cake would be around $500.By the way, Beautiful Cake!

post #6 of 115
I would charge between $550 and $600.
I'll never fit in a size 6 if I keep having cake for breakfast.
I'll never fit in a size 6 if I keep having cake for breakfast.
post #7 of 115

Just a suggestion to keep this easier to manage (love the idea btw!)... is it possible to create a new album in the gallery for the purpose of this thread?  People can post the picture and everyone can add their comments on what they would charge?  I can see the potential for this thread to get confusing and then forgotten as it grows and that would be a shame.  

post #8 of 115

I would charge $850 - but this takes into account higher 'costs' in Australia

Also our serving sizes are smaller - and if we use extended tiers (like your middle one) there is normally a board in the middle so you effectively have double the servings for that tier.

Not sure about the 5inch tier (base)  Guess that would have to be single serves ??

What do you guys do when you have varying height cakes when it comes to serving?

A sense of humour is a wonderful thing  - without laughter, the world is a SUPER boring place

PS..... only smart people can read truly WITTY comments and chuckle instead of getting all miffed

Hero of all time - GODOT

 

 

www.facebook.com/applegum

Th...

Misc 3D Cakes
(1 photos)
  

A sense of humour is a wonderful thing  - without laughter, the world is a SUPER boring place

PS..... only smart people can read truly WITTY comments and chuckle instead of getting all miffed

Hero of all time - GODOT

 

 

www.facebook.com/applegum

Th...

Misc 3D Cakes
(1 photos)
  
post #9 of 115

I would ask the question who are you asking to give prices?  It seems to me we're going to get prices across the board not necessarily based on any real knowledge of what prices should be. 

 

In regards to cost, it's very important, but the only way to know how much to mark up a cake is to know what the market will bear.  In my opinion a good many home bakers are not going to figure costs - period.  No matter how much they are harped on to do so.  But since they are going to proceed anyway, we might all be better served if they charge in line with what brick and mortar bakeries charge for similar work. A brick and mortar bakery is forced by market conditions to price appropriately.

 

I've seen "free market system" brought up in defense of charging very low prices, but the free market and federal trade laws are built on the assumption that people will seek the highest value they can, but it doesn't work when folks don't endeavor in their own best interest. And that's what's happening.

 

Anyway, I would charge $725 for that cake.

post #10 of 115
Thread Starter 
Quote:
Originally Posted by jennicake View Post
 

Just a suggestion to keep this easier to manage (love the idea btw!)... is it possible to create a new album in the gallery for the purpose of this thread?  People can post the picture and everyone can add their comments on what they would charge?  I can see the potential for this thread to get confusing and then forgotten as it grows and that would be a shame.  

 

 

That's a great suggestion.  Since I'm not part of Cake Central, I couldn't create one that would allow other people to post cakes to it.  I can, however, suggest that Cake Central add that as a category.

www.VeryDeliciousDesserts.com

https://www.facebook.com/pages/Delicious-Desserts/207874222593145

 

It's never "just cake!"

 

You may get a cake for $way to little but you won't get this cake!

Animal
(4 photos)
 

www.VeryDeliciousDesserts.com

https://www.facebook.com/pages/Delicious-Desserts/207874222593145

 

It's never "just cake!"

 

You may get a cake for $way to little but you won't get this cake!

Animal
(4 photos)
 
post #11 of 115
Thread Starter 
Quote:
Originally Posted by Rosie93095 View Post
 

In our area that cake would be around $500.By the way, Beautiful Cake!

Thank you! 

www.VeryDeliciousDesserts.com

https://www.facebook.com/pages/Delicious-Desserts/207874222593145

 

It's never "just cake!"

 

You may get a cake for $way to little but you won't get this cake!

Animal
(4 photos)
 

www.VeryDeliciousDesserts.com

https://www.facebook.com/pages/Delicious-Desserts/207874222593145

 

It's never "just cake!"

 

You may get a cake for $way to little but you won't get this cake!

Animal
(4 photos)
 
post #12 of 115
Thread Starter 
Quote:
Originally Posted by ApplegumPam View Post
 

I would charge $850 - but this takes into account higher 'costs' in Australia

Also our serving sizes are smaller - and if we use extended tiers (like your middle one) there is normally a board in the middle so you effectively have double the servings for that tier.

Not sure about the 5inch tier (base)  Guess that would have to be single serves ??

What do you guys do when you have varying height cakes when it comes to serving?

 

 

Pam, I would serve the 5 layer as singles.  For 6 layers, I ask the couple if they prefer dividing in the middle (3 layers) or reg (4 layers) and 1/2 (2 layers).

www.VeryDeliciousDesserts.com

https://www.facebook.com/pages/Delicious-Desserts/207874222593145

 

It's never "just cake!"

 

You may get a cake for $way to little but you won't get this cake!

Animal
(4 photos)
 

www.VeryDeliciousDesserts.com

https://www.facebook.com/pages/Delicious-Desserts/207874222593145

 

It's never "just cake!"

 

You may get a cake for $way to little but you won't get this cake!

Animal
(4 photos)
 
post #13 of 115
Perhaps you could ask people to provide the price per serving as well, I think that helps smaller bakers understand why the prices can seem so high.
elsewhere.
elsewhere.
post #14 of 115
Thread Starter 
Quote:
Originally Posted by howsweet View Post
 

Howsweet, I'm trying to quote you but having trouble.

 

Those are very good points.  

 

Quote:  "

I would ask the question who are you asking to give prices?  It seems to me we're going to get prices across the board not necessarily based on any real knowledge of what prices should be. 

 

In regards to cost, it's very important, but the only way to know how much to mark up a cake is to know what the market will bear.  In my opinion a good many home bakers are not going to figure costs - period.  No matter how much they are harped on to do so.  But since they are going to proceed anyway, we might all be better served if they charge in line with what brick and mortar bakeries charge for similar work. A brick and mortar bakery is forced by market conditions to price appropriately.

 

I've seen "free market system" brought up in defense of charging very low prices, but the free market and federal trade laws are built on the assumption that people will seek the highest value they can, but it doesn't work when folks don't endeavor in their own best interest. And that's what's happening.

 

Anyway, I would charge $725 for that cake."  end quote

 

I think everyone should offer what they would charge so that we can all see just how different that number can really be.    Very good point about the market.  Very good & very valid points on several counts.

 

Sadly, I can't make the fisherman drink the water.  Yes, I know I am mixing metaphors.  All I can do is offer some advice.  As always, they can choose to use it or leave it.

 

Even more sadly, the market is often influenced by those not knowing the true costs and undervaluing their own work.  

www.VeryDeliciousDesserts.com

https://www.facebook.com/pages/Delicious-Desserts/207874222593145

 

It's never "just cake!"

 

You may get a cake for $way to little but you won't get this cake!

Animal
(4 photos)
 

www.VeryDeliciousDesserts.com

https://www.facebook.com/pages/Delicious-Desserts/207874222593145

 

It's never "just cake!"

 

You may get a cake for $way to little but you won't get this cake!

Animal
(4 photos)
 
post #15 of 115
Thread Starter 
Quote:
Originally Posted by kikiandkyle View Post

Perhaps you could ask people to provide the price per serving as well, I think that helps smaller bakers understand why the prices can seem so high.

 

 

Good point.  Especially on the cake I used as an example.

 

The reason I didn't use that is that people use varying charts.  Using the chart I like, that cake serves 105.  I calculated that by 12" serving 51 + 13 extra servings per layer, 8" serving 20 + 10 extra servings for 2 layers, & 6' serving 11.

www.VeryDeliciousDesserts.com

https://www.facebook.com/pages/Delicious-Desserts/207874222593145

 

It's never "just cake!"

 

You may get a cake for $way to little but you won't get this cake!

Animal
(4 photos)
 

www.VeryDeliciousDesserts.com

https://www.facebook.com/pages/Delicious-Desserts/207874222593145

 

It's never "just cake!"

 

You may get a cake for $way to little but you won't get this cake!

Animal
(4 photos)
 
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