Hi.........question for all of you experienced cake business people out there.
I had a phone call from a woman who owns a cafe who would like to subcontract me to do cakes for her shop. Because I work out of my home, I feel that my prices are really reasonable, and the lowest they could possibly be before losing money.
Anyway, the owner called me to do an anniversary cake. The request was for a chocolate with choc buttercream, 3 tiered, to serve between 60-70 people. The woman wants to spend 60.00 for the cake, which I think is unrealistic.
For a cake like this, I would charge 1.25/slice. I am one of the cheapest in my area.
They want me to deliver it, which is 1/2 hour away. I am charging 20.00 for delivery to cover gas, mileage, and time to set it up. They also want equipment, which is also a 20.00/charge for the cake plateau, and a 20.00 deposit so that I get it back. She also wants fresh fall flowers on it, which will probably cost 25.00 bucks. I probably could ease up on these extra charges, but I feel like I need to stick to my guns.
All together, for a 3-tiered cake feeding 70 people, it will cost about 140.00, after they get their deposit back. The cafe owner also wants to mark it up so she takes her cut, so she will mark it up however much.....Does this seem reasonable?
Feedback needed!!! Thanks!!! Ellen
Hi _ I dont htink you are overcharging at all - $60 is ridiculous for a 3 tier cake with all that she wants specially the fresh flowers etc. Maybe you can give her the option of getting the flowers herself and then arranging it for her. I think you should stick to your guns. However I dont have that much experience as I dont have that many orders or cafe orders, so I am not sure how that works. Even if you had to come down a bit so that she can figure in a margin, I dont think you should come down too much, maybe 25c/serving MAX. Just my opinion. Hope someone else replies.
I think that you do need to stick to your guns on this one. I think that $140.00 is completely fair and reasonable. If this lady doesn't want to spend that much then she will need to come down onher expectations for this cake.
As you know cake decorating is HARD work and is time consuming. Don't sell yourself too cheap or you run the risk of getting trapped by these lower prices.
Congratulations on the subcontracting offer. Even if this anniversary cake falls through, there will be more orders!
......just my opinion. Easier said than done though, I'm sure!
Ellen, I don't think there is anyway you could do a cake for less than 1.25/slice. I think that sounds more than reasonable. I charge 2.50 but I know just being in different parts of the country makes a big difference. I don't know where this woman could get such a cake for $60.00. Hope you can work something out with her but I think your price is right! Bonnie
I think an appropriate response to her, pehaps should be something along the lines of:
"Woman, have you lost your freaking mind!!??"
She has to feed a few guest, you have to feed your family. Stick to your prices. Oh..consider raising them also.
When the $ 60 price is mentioned once again laugh hysterically for about a minute, finally stopping, wiping your eyes and say "No, really, stop, your killing me, you funny lady you!"
Lol...thanks!! At least I know I'm not the one losing the freaking mind!! 
I do appreciate all of your advice. I think people go into sticker shock when they find out how much a real cake costs. They've been suckered by the Sam's club and Costco prices, and many people don't see the difference. I appreciate the feedback!!
Ellen I agree with everyone else!! You charge what is worth it to you!! I think that price might be a little low. Using your stuff, you getting flowers etc.. that person must thing you are a fool. Don't budge!! If she doesn't want to pay you tell her to find someone else. GOOD LUCK!!
i agree with everyone else! why doesnt she just charge you to make the cake? haha actually if you do it for that low you are paying her to make the cake, your losing money. if she wants to pay that price, she needs to pick a nice sheet cake, simple as that.
good luck, let us know what happens!
melody
Ellepal, don't do it!!! And DOWN WITH SAM'S CLUB BAKERY!!!! Let's see Sam's CLub do all of that for $60!!! I am still learning not to underprice myself, and I enjoy cake making so much I end up doing extra work on them that wasn't really included in my price (a fondant bow here and there, rice paper bitterflies....) I'm still learning too. Cake Central will set us straight!
Ok ......she seeing if she can play you ....if she can get you to come down on this shell want all the orders to go like that .....Dont htink taht when she marks it up shes not gonna do herself the favor of cutting her fee!!! no no no ......you set your price and then stick to it....you work is fabulous.... dont settle
Now Ellen don't think of coming down on your price. For the work you do I think you ought to charge a little more. If this woman gets one cake out of you cheap like she wants there's no way she won't expect it every time. I'd set my price and stick with it and if she can't pay that she can go with an inferior bakery cake. Let people hear about your work and come directly to you. Looks like you're doing quite a number of cakes and they all look great!
I just realized who you were Ellen. You're the one that just did some dummy cakes for a pastry shop! You need to set that lady straight. You are very talented & don't deserve to be taken advantage of. Is this lady the owner of the shop? Good luck~
Why not make her day and say that you will do it out of the kindness of your heart and charge her nothing for it . GIVE ME A BREAK!!!!!!! You, if anything under charging What really gets my goat is that I think we all put in a lot of hard work in our cakes and not to mention the STRESS FACTOR and then as if that isn't enough to deal with people think we should do it for nothing!!!!! After seeing some of the cakes in the gallary section I sometimes can't believe how wonderful everyones cakes are and most of us are not "PROFESSIONALS" I think are cakes are just as good, if not better than ones sold in cakes shops. We should all have a little more confidence and strength.
SORRY TO GO ON AND ON
Sorry!!! but $60.00 for a 3 tiered cake...Uhhhh Nope!! and she knows that too!!! Don't let her take advantage of you....
Don't let anyone take advantage of you and your skills! That being said, you should definitely have two sets of prices: one for regular customers (retail price) and one for businesses that you supply (wholesale price). The prices for the resaurants that I supply are between 10 and 20% less than the prices to the general public.. However, when I do a wedding cake for a restaurant, the owner just gives me the customers name/number and I deal directly with the customer. Your situation is a little different since you are kinda in the middle! Just my 2 cents!
Anyway, once you give a price..be firm and hold to your guns or they will try and walk all over you!
The lower she gets you to go -- the more she can markup. SHE WILL MAKE A PROFIT!! SO. don't be ashamed of your price!
We are wonderful artists and we're underpaid for the time and stress that goes into our art work!
Hummm...yep, we're starving artists. LOL
I spent 6 hours just on frosting and decorating a cake and got paid $30, I'm not gonna let that happen again!
[quote="Dale"]I think an appropriate response to her, pehaps should be something along the lines of:
"Woman, have you lost your freaking mind!!??"quote]
Is she mentally unstable? 
Just kidding! Seriously though, I hope you gave her a piece of your mind in the most lady like way 
Tell her that for $60, you can do "Blah, Blah, Blah" (add in what ever it is that $60 would cover.) For the type of cake she wants with all the bells and whistles, you can't do it for any less than $160.00 (add 20 extra bucks, since she's being SOOOOOOOO unreasonable). Let her know that you can't do it for any less due to time required to create such a cake and not to mention, all the supplies needed.
IMHO, I think she's smoking crack and only a person that drugged up would say such a rediculous amount for what she's asking for.
I understand what Miss Missey says about charging restaurants a little less b/c it's a whole sale type of thing. . .BUT then again, it's not like she's ordering 5 three tier cakes at once. . . Ya know what I mean? Hang in there girl, and let us know what that drugged up lady has to say to your response. . . 
ellepal, I just saw your photos... WOW! Your better stick to whatever price you are comfortable with. I am a beginner decorator, and 60 bucks would be cheap even for my "newborn talent." You are very gifted. You will get plenty of other customers in the future who truely appeciate your talent. THEY will be willing to pay!
Brandy
How about telling her you'll do it for whatever Sams/Costco will do it for including their charge for delivery, set up and and use of the the equipment...tee hee! (Cause we all know that ain't gonna happen)
thank-you all for this marvelous advice. I just needed that back-up and support that I am not being unreasonable in my prices. I wrote the cafe owner an email and told her that if I can't make some sort of profit on it, it's not worth my time. I am also a full-time teacher, and I am in the business to make a profit and supplement my income. I am the cheapest in my area, so the cafe owner could double my price and make a profit if she wanted. I thought about it, and for a small 3 tiered cake, most would charge about 300. I am sticking to my guns. I just got my bakery license yesterday, so I am new to all of this. I am relying on all of your great experience to help me! That's why I love this site and all the great people on it!! THANKS AGAIN!!!!!
OK, hand me a shovel so I can hit myself on the head!
Once again I'm reading a post in TOTAL disbelief!
I agree with who ever said get the customer's name and number and deal with the customer directly.
I think that when you posted that you were going to do this we all suggested something like that...
that you do regular tortes for the cafe...like carrot cake, chocolate cake and whatever and wholesale them to the cafe and have her refer any "specialties" to you directly!!
WHAT IS WRONG WITH YOU WOMAN!...
* Diva shaking you by the shoulders!..lol
Stick to your guns, you will find out that cake is worth over $300 in the open market and don't for a MOMENT believe that's not going to be the price that cake is going to sell for.
I would sit this woman down with a contract....and spell it out ...
You will make her Tortes to sell by the slice or whole from her shop...but any other cake..she needs to give you the referal...in turn you will agree NOT to do any plain tortes for the clients.
I don't care WHAT she want's I wouldn't sell a 9 or 10 inch cake for less than $25.00..what she charges her customer is HER problem.
She MAY get someone to do them cheaper, but..not as good as you!
PS: a 10 inch cake CAN be cut into 12 to 16 slices....if you charge 25 bucks for the cake, it means she's paying 2.08 cent's a slice, if you cut it to serve 12. She can sell that slice for $2.50 to $3 dollars and make plenty. The more slices she cuts the cake into the more money she can make. Let her make that call for her shop.
Stay out of that mix. Just don't undersell yourself!
I think some people live in La-La Land!!!
If she want to spend $60.00 might as well settle for a sheet cake...
3 tier cake with the stuff she wants plus you have to deliver it and set up...
Shoot! Its like a wedding....
So, I am not a professional but you are NOT overcharging...
I'm with others. Even I (who is notorious for undercharging) think that $60 is a ridiculous expectation for a 3 tiered cake. We've all said that people who don't make cakes have no clue. Maybe they think that because it's not a wedding cake, it shouldn't cost that much?? If they don't want to spend any more than $60, then maybe you could give them some ideas for cakes within that price range? I would certainly charge for delivery and set up no matter what though! That's your time and $$. You shouldn't be giving that away. Good luck! Hope it all works out for you!
That would come under wedding cake prices for me. I charge $3.00 pp. Deposit for seperator items. $25.00 for delivery & set up
Ellepal,
Do not come down on your price!! 
You will just be selling yourself short!!
Don't think for a minute that this woman is going to think of you when people ask her about the cake and if someone else wants a cake that they think she provided, she will run to you again and ask for a STEAL, mark up her fee, and then she is taking all the credit for YOUR cakes and leaving you in the shadows.
I have seen the cakes that you do, they are gorgeous!! Don't let this person take advantage of you like that!
I agree with everyone here on this issue and with Diva's idea of doing her regular cakes and tortes and having her send the referrals directly to you!!
Ok, now I am getting off of my soapbox.
Hi Everyone....I have decided to stick to my guns and to charge the prices on my website. I am no longer the naive young bleeding heart I used to be, so I won't sway on my prices. Affirmative!! All of your feedback really enforced this. If 160.00 is too much for these people, I don't need to do the cake. I told the owner of the cafe via email that I am in the business to make money, and I am done doing free cakes for people and ready to start doing business. (in a polite, tactful way, of course!)I haven't heard back from her, so I may have lost a customer, but we'll see.
Everyone's advice is very appreciated....Pastry Diva, I like the idea of doing cakes and tortes for her on a regular basis, but I am only licensed to take custom orders and not really allowed to do wholesale from my house. (that's a whole new classification). The cafe owner wants to subcontract me for custom wedding cake orders, so that would be allowed. If she finds a customer for me, she does get a commission and takes her cut. I don't mind as long as I get the prices on my website. I just need to make her understand that I won't work for peanuts. The other people who do fondant in the area charge 4-7 bucks a cut, so she is really getting a good deal with me at 2.00 a cut.
Anyway, thanks for sharing, and I look forward to all the marvelous posts and ideas from everybody!!
Ellen
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