Pricing of cakes is a much talked about topic on social media. I discussed it previously on this blog but my views have changed recently for a few different reasons.
Firstly, I have become more business minded. When I first started my business all I wanted to do was make cakes and get paid for doing that. I lacked experience and didn’t feel I could justify charging a lot for my cakes. I still feel it was right to do that to a certain extent but the problem with starting off charging low prices is that its easy to become known as the lady that makes cheap cakes. That is not how I want to be known!
I have spent money, time and effort perfecting my product. As well as the ingredients and other consumables relating to a single cake, there is equipment to buy, insurance to pay for, training, advertising, paperwork and all the other little things that every business uses. This cost has to be passed onto my customers or I’d very quickly go out of business. In fact I had got to the stage where if I didn’t start making money from my cakes I would have had to give up my business.
I’m not sure customers always consider all that is involved in producing bespoke items and as I’ve ready many times online, it is our job to make sure our customers are aware of what it takes. As business owners, we should not undercharge or undervalue ourselves and our product. I spend many hours producing designs for customers, quoting for different cakes, filling in paperwork etc before I even start making the actual cake. Most cakes take about 2 hours to get to the ‘covered, ready for decorating’ stage (tins need lining, ingredients need mixing, cakes need levelling, filling, crumbcoating and covering with fondant), the decoration can take several more hours after that or even longer if flowers and models are required. That is just for a single tier, round or square cake.
One piece of advice I read recently that made a huge difference to me (I’ll try and credit the author when I can find the blog) was to ‘take the emotion out of selling’. I know I’ve been guilty of dealing with some customers on a emotional level in the past so, every time I feel emotions creeping into a conversation about cake, I remind myself that this is business. Yes I want to give every customer the very best cake that I can, I want them to be excited about it and I care about producing a high quality, delicious cake every single time but I cannot do that unless I can charge accordingly.
What advice would I give to anyone thinking about starting a cake business? Spend time perfecting your skills, take classes, practice, practice and practice some more and do not consider starting a business until you can produce a high quality product. Then, as far as pricing is concerned, you can start off with realistic prices and your business has more chance of being successful.