Selling Yourself Short

It seems that those of us who sell our goods and or services have a difficult time assessing our worth. I’ve come to the conclusion that people are willing to pay for quality if indeed they will receive it.

For a few years now I’ve been making cakes, mostly for family and friends and occasionally a stranger will order one too. I figured with the infrequency of orders I should keep my prices low, which for a massively decorated cake works out to a whopping twenty-five cents an hour wage, if that. I know, I’m totally ripping people off for charging so much, right?

Why would anyone pay $40 for a cake they can get at the store for $35? Are the cakes at the store made with real butter, Madagascar Bourbon vanilla and milk, cream and/or buttermilk? Are they made with eggs that were gathered just days before and in some cases the same day? Does the baker actually have to pay attention to the cakes that come out of the oven, or do they simply pull it out of the freezer to defrost? Do they make their own frosting with real butter, real vanilla, real sugar and real milk or do they pull it out of a white bucket labeled “Buttercreme” complete with ingredients the average person with a PhD couldn’t pronounce, let alone identify? Do they use $25 worth of ingredients for a cake they sell for $35 or is it comprised of imitation processed food products whose total cost is around $5?

I know that I am not the best cake decorator. I’m actually quite amateurish in that department comparatively as far as piping decorations with frosting, but give me some modeling chocolate and/or fondant and I can sculpt something quite imaginative. My cakes may not be iced the smoothest texture-wise, but taste-wise could beat out nearly any supermarket cake out there. The cake itself may not be completely level but I can guarantee they taste delicious, mostly thanks to a lot of dairy products that go into them. This isn’t to say I don’t use vegetable oil in my cakes, but it is always secondary to the butter in the fat department, with few exceptions where oil simply is a better fit for the cake due to multiple trial and error test bakings. Even my Honey Cakes, which are gluten-free, dairy-free and cane-sugar free (made with honey instead for both cake and frosting) taste delicious, and work well for a multitude of allergies, intolerances and people with diabetes.

Is it feasible to charge more for a better product? Years of retail experience have taught me a couple things: If it is really cheap, and I’m talking single digit pennies on the dollar discount cheap, people will buy it; if it is low priced while a nearly identical product is high priced, the skeptic in the shopper comes out and they wonder why the low priced version costs so little and will usually get the high priced item instead thinking they are getting a better value quality-wise when in reality they are the same exact product made by the same manufacturer. If something isn’t selling, I’ve found that the item will usually get a mark-up, not a mark-down, and for years this befuddled me until I was out of a job and trying to apply my 15 years of retail experience to good use. Yes, a good chunk of it is utilized in my volunteering at Clark College, our local community college where I’ve been on the Board of Advisors for Business Administration for four years now, but I’ve come to realize I need to apply it to the rest of my life as well.

For anyone who sells goods and/or services, either on their own or through an online community or co-op, pricing your products is the hardest part. I suggest you take a good look at what you are offering and ask yourself some valuable questions. Am I providing a product or service people are interested in? Do I do something different than others in the same category? Am I charging what I’m worth in order to make a profit? If you answered yes to the first two, but the third question is a little iffy, rethink your plan, and if you don’t have one, make one. Take your costs and write them down or type them onto the computer to get a good visual aid to help you see exactly where the money you are spending is going into the products you are selling. This was quite eye opening for me as I didn’t realize that I spent almost what I was selling stuff for, which isn’t very good business. You’d be surprised how little things add up, and this is especially true of time, which honestly is the most valuable part of the equation as far as you should be concerned. Even if you provide a product or service that requires very little capital to produce, more than likely it is quite time consuming and you should be charging for that time. A photographer for instance may only spend two hours taking pictures, but how many hours of editing go into making those pictures the very best they can be? A quilter may use leftover scraps from other projects to make a quilt, but how many countless hours, and in some cases days, are spent hand quilting the fine details that make that quilt a one-of-a-kind piece of art? I urge anyone out there who thinks their time is not valuable to rethink their business plan, and if they don’t have one, it’s time to start. This is even true of the much under-appreciated homemaker, the least paid, most worked person of all.