How much should I charge for custom cakes?

Question

I have a cake business and I sell custom cakes from 8" simple cakes to 4 tiered cakes. I never know how much to charge. I know I should base pricing mostly on the time it takes to make & decorate the cakes, but it would take anywhere from 3 hours to a week of preparation & practice. That being said, I can't charge by an approximate hourly rate. Plus, since I'm a home based business, my supplies are still pretty costly since I don't have the space to store a lot of inventory.
Any ideas? I just don't want to continuously lose money or undercharge for my services. I'm new to this and don't really know what to do.
I made up a spreadsheet that tells me how much each cake costs, as well as what the filling costs, cake boards, dowels, etc. What else should I be doing to figure out correct and fair prices?

Thank you!

Answer 1

as a former caterer, one simple method is to add the cost of all your supplies, add costs of utilities, for baking, clean up, etc., and then multiply that figure by 4. That should cover your labor expenses.

Answer 2

^What you should do is figure out how much it costs for the ingredients per cake like how many cakes do you get out of 5 pounds of flour, one pound of sugar, 1 dozen eggs, etc. then add your time in, if you do this you can't lose money. If your not already doing this, either have them pay in full before you bake or at least get a partial payment, maybe half so you don't get stuck holding the bag or should I say cake.

I would go to your local bakeries and get an idea of prices, also go to the library, they should have books on small business's and can help you figure out your prices.

I have provided two sites below, they can give you an idea of cake prices. I hope this helped, good luck with your cake business.

Answer 3

As a general rule, you want to sell based on what people are willing to pay. First, you have to start premaking your cakes. Sometimes you will find that you cannot give someone a cake immediately. When this happens, raise the price on that particular type of cake. Right once you come to the point where you always have enough, lower the price just a wee bit. How else do you think they can justify charging so much for gasoline and haircuts?

Answer 4

I would call up and visit local bakeries to see what they charge for what types of cakes. You don't need to tell them that you are planning on doing the same thing--you could just tell them then you were thinking of purchasing a cake for an occasion, and wanted to see what the prices were. That might be a good way to research what the average prices are in your local area (plus, you can check out the competition...)
Good luck!

Answer 5

You need to charge by the slice...example if there are 200 people to eat a cake you should charge anywhere from $2.00 to $4.00 a slice... example if you charge $2.00 a slice that would be $600.00 for a cake to feed 200 people. If are still not sure call around to different cake businesses and act like you are a would be customer...say I want to know what you charge for a 2 tier....3 tier cake to feed 200 people. i hope this helps.

Answer 6

Check other backeries, or ask some people who have owned one or work at one. That will help. But in my opinion i would say $5 on a simple cake.

Answer 7

Email me at [e-mail].I own a cake business and can help you.

Answer 8

You need to do research to find out what other bakery operations in your area are charging.

Answer 9

Depends what they consist of.

1$ seems fair.

Some even around .75$

Good Luck.

Answer 10

£5 to £7.50