Wednesday, May 25, 2016

How To Charge For Decorations On Cakes

I had a shop owner who bought my pricing guide ask a couple of questions that she was curious about.

The issue was how to price cakes if you've never done the design before, and also how to quote for the same design but for different serving counts.

First of all, if you've figured out your pricing then good for you, but if you haven't, get my pricing guide. It will shock and amaze you to see how precisely you can price your cakes if you actually follow the instructions, and it will prevent you from lowering your prices when people cry that they can't afford you.

Four tiers...

...Or three tiers?

The issue about pricing the same design for a different serving count is fairly simple. If you've figured out what your per-serving cost is, the difference in servings will make up the bulk of the price increase. The question comes from increasing the decorating cost for something that might take a little longer for a three-tiered cake than it does for a two-tiered cake, but you don't have to charge twice as much for twice the servings.

What you should do if you've never done a specific design before is just take an educated guess about how long it's going to take you, then increase that by at least 50%. Because you never know what will happen...

That's going to be the time that you charge for based on your salary. Add in the cost of your materials and profit, and that's the amount that you should increase the price the first time you do that design. The base price per serving will already include your overhead expenses, so any increase based on hands-on decorating time doesn't need to include that part of your costs.

When you do the actual work on the cake, keep track of how long it really takes you to do it. Take notes so that you can refer back when the next order for that design, or something similar, comes along. The second time you do any design it won't take as long as the first time, but if you keep track you'll be able to price it out more accurately.

For a larger or smaller version of that design, just use the actual time and increase it based on the size of the new cake. You might even want to keep track of how long it takes you to do each tier if it's something like piping lace, since you'll be able to refer to that to see exactly how long it takes to pipe an 8" tier vs. a 12" tier that way.

If it turns out that you need to increase the price of your cake $50 to cover the decorating costs for a 100-serving cake, that's a 50 cent per serving increase. If you need to increase it $100, that's a $1 per serving increase.

Once you do this a few times you'll be able to get an idea about how much you should increase the per-serving charge for that particular type of design.

Any questions? Leave them in the comments below.


Kara Buntin owns A Cake To Remember LLC, custom wedding cakes in Richmond VA, and cake supplies online at www.acaketoremember.biz and www.acaketoremember.etsy.com

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