Cake! magazine by Australian Cake Decorating Network August 2014 | Page 64
Business Basics
Louise Vansleve is the Founder of Learn Cake
Decorating Online and Cake! magazine's regular
Business Basics contributor.
This issue Louise is covering the hot topic of
PRICING...
Oh this must be the bane of the cake decorators’ life! One of the most commonly discussed topics on blogs
and forums around the world is pricing. Second only to perhaps ganache!
Rather than tell you what you should be charging for your cakes, I am going to give you a formula, so you
can work out a price based on your own costs and market. After all, there are huge variances across the
world.
One of the biggest problems in pricing cakes is that we undervalue ourselves. Just because your business
is relatively new, does not mean you are not paying the same electricity and raw ingredient prices than the
cake decorator in the next suburb.Selling cheap cakes, devalues not only you but also every cake decorator
out there who is trying to make a living. I find it amazing that people will sell cakes and not take into account
the labour involved! I hear stories constantly of people selling cakes for only a few dollars more than what it
cost them to buy the ingredients! That, my friends, is not a sustainable business. It may be tempting to sell
cakes cheaply when you are starting out, as you may have only done a few novelty cakes or a few classes.
Don’t worry, this is an issue for all decorators just starting out. And its a tricky one.
Firstly, don’t just work for free! Even if you don’t think your work is worth charging for just yet, you have still
paid for ingredients, your tools, your electricity and importantly your time!
A good way to tackle this is to advertise a limited time “portfolio building” pricing package. Make sure you
advertise it and invoice the client with the prices you are aiming to get once you are more established. Show
a discount given on the invoice, so the client knows the true value of the work. This strategy is often employed by more experienced decorators who, dying to try out a new technique but knowing the client has
a limited budget, may offer to do the cake within budget because they would rather be paid something for
trying out a new technique than doing it in their spare time for free! Just know when to stop. It’s ok to do this
occasionally or when you are at the portfolio building stage, but you will soon be out of business if you do it
too often!
Secondly, its ok to say no. Actually, start practicing this...on your kids, husbands and clients. It gets easier
I promise you. Just remember if you asked, the client to go into their office for a day for free, they probably
wouldn’t hesitate to pull out the ‘n’ word!
An option is to offer additional free product with your regular pricing. For example with a $200 cake, you
may offer 12 matching cupcakes. Now these cupcakes may have a sale value of $5 each or $60 for 12 but
are going to cost you about $20-30 dollars to make. Therefore rather than offering the client a 30% discount
that will cost you $60, you will be costing yourself $20-$30 and protecting your future business.
Wedding cakes are a little harder. You may find that you have some friends getting married and you may
offer to create their cake at a reduced rate. However if your cake making skills are up to standard and you
are confident in your ability to produce a high quality cake, I do not recommend ever discounting a wedding cake. The time that you invest in your cakes and the stress (yes getting a cake out the door and to the
venue in one piece has caused more than one decorator to break out in a sweat) simply is not worth taking
a discount to.