Well, here at CakeBoss we believe that a cake is a cake, no matter what the occasion, and that there should be no price difference. This is why it’s so hard to price cakes, and why CakeBoss Software is essential to your beginning cake business. And the cost of your time has nothing to do with how much you paid for ingredients. What do you think is the most expensive ingredient in your cake? Is it the butter? Maybe the sugar, or buttermilk, or eggs? It’s important to know what your costs are, and factor them into the price of your cake take a look at some of our recipes where we’ve provided an ingredient cost breakdown! But, the most expensive ingredient in your cake is your time. Why isn’t basing my price on the cost of ingredients a good idea?
In our experience, this method results in grossly underpricing your product. We firmly believe that the “ingredients times 2 or 3” method of pricing is arbitrary and not rooted in any kind of business theory. I have read that a good way to price cakes is to charge for the cost of ingredients times 2 (or 3). When YOU value your cakes and price them appropriately, your customers will too. The first thing to remember is that we are our own worst critics. It is natural, when you are starting your cake business, to feel unsure of your skills, and hesitant about charging very much for your cakes. I don’t feel right charging very much – I’m just starting out. The most common problem with pricing is underpricing. In this article, I will address some of the common questions about the pricing issue. We don’t want to sell ourselves and our talents short, but neither do we want to shock our customers with high prices, leave them feeling like they paid too much, or even worse – have a customer argue with us about the price of our cake. Finding the right price point requires research of your competitors’ prices and a solid understanding of your own costs.Īs artists, it is hard to know what value to place on our work.
As with real estate, the price of cakes varies widely by location and is largely determined by your local market.
Setting a price structure is one of the most difficult parts of any business. The simple but frustrating answer is that no one can tell you how much you should charge.
This is one of the most frequently asked questions by cake decorators when they begin to sell their cakes.
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