What’s Up With This?

VIDEO: What’s Up With This?

Why is this baker scared of selling her cakes for what they’re really worth? Why do some people undercharge? Why do they undervalue themselves? Please share your thoughts below.

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What’s Up With This? — 9 Comments

  1. These are some of “reasons” i’ve come across.
    – the imposter syndrome, where a hobbyist gone business owner feels like they are a fraud and if they charge a higher price, they’ll get heat because of that

    – all the competition in their area is mostly mom-bakers who charge barely for the ingredients and/or bakeries or pastry shops who can keep their prices relatively lower due to larger production. They get price-blind and think they can’t charge the real value even if half of the competition has a lower skill set and the other bakes in bulk.
    (you should keep your area’s price points in mind when designing products, of course. If nobody’s willing to pay $250 for a cake, then you have to develop products that are cheaper but you still make a profit with them. And not sell your $250 cake for a hundred bucks)

    -They get too emotionally attached to their cakes. That’s a common problem.
    When you work for someone else, it’s not your business and you don’t have emotions invested in the products you make. Those who get into this business by first being a hobby baker can have a hard time selling their products for a real price. They love what they do, they don’t think it’s a job, they do it to get money, but mostly they do it because they love cakes and making people happy. It’s not necessarily an all bad thing, but when you are so invested emotionally to your products, you tend to forget you need to make that profit, you get too angry when you get a complaint and lash out badly, you feel bad for asking the real price (and use the word ‘asking’ instead of charging), you nit pick every detail of the design and use wayyy too many hours on the design because it has to “just right”, otherwise you yourself, the baker won’t be happy (nevermind the customer, who’s extatic) and will even offer a discount for the baffled customer who was satisfied.

    The emotional attachement is the greatest cause. If you want to run a profitable business, the emotion has to be taken off from certain business decicions like pricing. This is often the biggest difference between succeeding or failing.

  2. Like others on here I agree that the #1 reason bakers (me included sometimes) tend not to charge what we should is we are afraid of losing customers. Even though we don’t want the customer we didn’t charge enough to keep coming back – I mean – really?

    I have started keeping my prices aligned with other cottage bakers in my area. As someone said – there is enough work out there for all of us. 🙂

  3. My wife and I still have this discussion after two years in business. She is an extremely talented decorator. Me, not so much. But when it comes to pricing our cakes and cupcakes we always disagree. She will see the cost of our ingredients and supplies, but 1 always discounts her labor cost. Then, 2 she doesn’t want to overcharge and offend the customers, because she worries they won’t come back.
    I always remind her how much she made at her cake decorating job before we opened our own bakery. And then we use that as a base for our pricing.

  4. I feel that so many of us hobby bakers lack confidence because we don’t have a framed paper saying we can bake. I’ve baked and baked for years read everything, experimented etc., But I do believe that confidence and experience go hand and hand. If I were to get serious in the cake business I myself would work for a minimum of 6 months at a bakery. Learning tricks building speed and confidence.

  5. I had this same problem when I first started out as well. I viewed my cakes as a hobby until a friend told me I was crazy for not charging what my cakes were worth. I was afraid I guess. I still do second guess myself sometimes out of fear of running customers off, but so far, not a single customer has complained and I have many repeat customers

  6. She may not have every paid for a three + hundred dollar cake, she may know her customer base and know it might be a struggle for them to pay a higher price, she maybe live in an area where they can easily go elsewhere etc.

    I think that if you price too low, the customer may feels that they’re not getting a good quality product, just saying…

  7. Thank you for posting this so many of us have this problem….at least at first. Here are “excuses” why we do it…keep in mind, these aren’t good reasons, just fears…
    #1 a BIGGIE…people can be soooooo RUDE and will say things out of ignorance because they don’t know. like “wow I can get it from Walmart Cosco, Bj’s etc for half that! Or Baker X will do it cheaper. Of course we should never let that bother us but we do.
    #2. We might not really know our actual costs and our worth (again, not logical…just how we can be)
    #3 tons of competition out there and we are afraid we won’t have any business. (Even though we know we don’t want that kind of business) we don’t remind ourselves that we want to be known as the awesome cake lady not the cheap cake lady. If local bakers would unite rather than compete, we would do ourselves a favor. Remember you can’t take on every cake in town besides having an alliance can be a helpful thing!

  8. She might think that if she charges more she will lose her customers. Others feel that their work is not as good even though people rave over their work. I have a little bit of that I always think my work is not good enough but I know the people I make them for love my work. Also some bakers live in areas that do not command high price cakes.

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