A lot of people have been asking me how I figure out what prices are suitable for my cakes and cupcakes. So I decided to take the time to make a video and blog post about it.
Here are a few tips that I hope will help you figure out the perfect price for your product.
1. NO ONE CAN TELL YOU HOW TO PRICE YOUR PRODUCT
I know. Not what you want to hear.
This is simply because we all have different costs all together. We use different brands of flour, sugar, butter etc; also, some people buy retail, others wholesale, other make fpeofit on stock they did not invest in. It all solely depends on your costs.
2. DO NOT NEGLECT ANY COSTS THAT AFFECT YOUR PRICING
Do you have workers? Are you paying rent? What’s you gas bill? Water bill? Electric bill? How much are you spending on dish washing liquid? How much time are you spending on a cake?
All these questions will help you eventually figure out how you will price your products. These are all very real and vital questions you’ll have to ask yourself.
Here is a method I used to figure out how much it would cost me to bake, I’ll give you an example of flour:
Hypothetical if 1kg costs ZMW15, and each page gives you 10 cups. What you will then do is divide ZMW15 by 10 cups and that will give you ZMW1.5 per cup.
So you can do this with you sugar, milk, flour etc and when you know how much each item costs, then you’ll know how each later of cake costs per flavour. Don’t rush this process and make sure it’s perfect. However, be sure to adjust prices once costs go up or down.
3. MARKET RESEARCH
Don’t shy away from knowing what people charge in the market as it is vital that a market have a balanced price scale. Or course we can’t all be uniform but just be in the know.
Market research also helps you find yourself. Do you want to be the most affordable? Most available? Most expensive? What’s you edge?
4. PRICE YOUR PRODUCT
When you have valued everything well and youre confident, set the price! How do you value your time? How do you value your product? Once again, what’s you edge?
Thanks so much for reading.
Here is a link to a video that explains all these points:
Until next time! Happy caking!