How to calculate the price of your desserts
When you make desserts for Savorly, one of the most difficult tasks is figuring out how to price it out. It is important to determine if you are making a return on your investment. To help you out, we put together some recommendations on how to price out your delicious sweet treats.
What to consider when setting your price
We’ve listed out some important factors that you need to take into consideration before settling on a price.
Ingredients: Think of all the ingredients that you use for your dessert such as salt, sugar, flour, eggs, vanilla extract or pieces of fruit. When you buy an ingredient, the entire package or content may not be needed. Knowing that, it is important to figure out the cost of what you actually use when you make your dessert.
Example: You bought 24 eggs at the supermarket and paid $6.00 but only used 8 eggs in your cake. To calculate the cost, multiply the amount you used by the total price you paid. Then divide that result by the total units in the package: (8 x $6.00) / 24 = $2.00
|| 8 pcs
|| 24 pcs
This way, you can get an idea of the cost for each ingredient that you used.
Labor: Learn how to value your labor. The amount of effort that goes into making a carrot cake is not the same as making a chocolate fudge cake. Each cake can take up different amounts of time, requires different skills, talent and techniques. Only you can determine how much you should charge. We suggest that you don’t forget to include labor costs in your final price of your product.
Operating expenses: When making desserts we use utilities such as gas, electricity, water and sometimes the internet! Factor in how much you’re using when you’re making your products and incorporate that usage into your final price.
Profit: Again, this is another element that only you can determine. We recommend a profit between 30% and 40% of your total. However, if you are just starting out in the business, it may be less. Some factors to consider are: the competition in your area, the experience you have making desserts and if you have had any professional training.
All the factors that we listed are important to help you determine a price for your final product. Now it’s time to get down to work and delight your customers with desserts full of love!