The most asked question I see in many of the cakey groups on Facebook is...
I've been asked to make this how much should I charge ????
Or my customer needs a cake to feed a 100 people and would like it to be 3 tiers with cascading flowers etc etc... But Their budget is only £25.00....... My answer... Send them straight to a local supermarket they're obviously never going to want to pay you for your actual costs let alone your skills and valuable time. It's important to never under value yourself.
RIGHT HOW TO START COSTING YOUR CAKE.
For those of you with a smart phone it's super easy , download a cake costing app ! They are fantastic and very simple to use.
The 'cake makery' even have a free app, or for a small fee you can get 'cost a cake pro' which I highly recommend.
The pro allows you to add your own recipes, ingredients and set your own hourly rate.. (Which I recommend to never be lower then the minimum wage) plus lots more.
You can Find out more here.
http://www.thecakemakery.co.uk/apps/
For those that wish to work out on paper-it is time consuming but once you have worked out the cost for basic cake sizes it can be used to refer to for future cakes just remember to update any price changes as they occur and remember every cake will be different depending on decoration, hours worked etc....
Sample spread sheet for 12 cupcakes with hand made sugar flower decorations
To work out the cost of the ingredients used in the recipe you simply divide the total cost of ingredient by the pack size and times the amount used.
So if a pack of flour is £1.50 for 1kg the calculation will be
150p/1000x170 = 25p
For items such has food colouring, cmc powder I usually just add £1-£3.00 depending on the size of the cake and colours used. Working out an exact cost is just far to tedious for me ...
Don't forget to add everything that will be used in the production of the cake.
Cake boards/drums, dowels, ribbons, cake boxes, not forgetting the little hidden extras that you pay for Like baking paper, double sided tape, paper kitchen towel, extra cleaning products and postage costs if you have to order anything on line it all adds up and comes out of your pocket.
Once you have costed all this, estimate the hours it will take to actually cook the cake and decorate including pre-heating the oven ( an estimate to run an oven for an hour is approx 35p )
HOW MUCH DO YOU CHARGE FOR YOUR TIME ?
People often find this the most difficult, nobody should ever work for anything lower then the minimum wage . You could charge at different rates even.. A lower rate say for baking the cakes, and a higher rate for the more skilled work like hand crafting very detailed decorations and cake toppers etc.. What you charge will depend solely on your skills and experience and be unique to you.
Once the cost & labour have been totalled you can add a profit percentage I believe the general rule is 35% but can be lower or higher if you choose to use a profit percentage.
DELIVERY CHARGE
This will vary on each order, and should include petrol cost and your time.
MATES RATES
Family & friends are the most difficult to cost. Decide on a fair discount and keep it consistent and fair. For example; 10% for friends and 15% for family.
I see nothing wrong in doing a free cake every so often for family and close friend, if it's a special occasion and you have the time, it saves searching for a gift. Just remember if you have to decline a paying customer to work on a free cake it's going to work out more costly.
I hope this little guide gives you a better understanding of costing your work fairly and consistently. Remember only you can decide on percentages to add and discount and how much you want to charge for your time, because Fred blogs down the road only charges peanuts, don't feel the need to compete, their customers are probably getting exactly what they have paid for!
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