I know you probably think I’m a little mad… because why would you want to thank someone who is out there undercutting you and essentially stealing business away from you? Well, hear me out.
Before I get any further, let me start by pointing out that we’ve mostly likely been the cheap cake lady at one point in time. I almost think it’s a rite of passage for any decorator in our industry. We all started happy to do it for free for friends and family so we could practise our skills, then we moved on to just taking money for ingredients and then slowly charging just a little more for our time but no where close to what the cake was actually worth.
I’m here to tell you two things:
1. I was also a cheap cake lady at one point in time.
2. The cheap cake lady is NEVER going to go away. Sure she might get wiser and start charging properly, but I promise you someone will come along and take her place.
I meet a lot of cake people and I guarantee you at some point, the conversation always turns to the people who ‘steal’ business away by undercutting on a quote. We all have a good eye roll and a laugh (she agreed to do a 3 tier cake for $120?! – haha) but that’s as far as I will personally allow myself to go. I will never ever blame the cheap cake lady for my lack of business. You know why?
Because I am in control of the results and destiny of own business – I refuse to let an external source be in control. Sure, I might be frustrated with her when my quotes keep getting passed on with comments like ‘my friend is going to try and make it, thanks’ or ‘I found someone who can do it a lot cheaper. Will you price match?’ but I won’t make it her fault.
I’m going to digress here a little and talk about dog training. When I first started training my dog, I used to get really frustrated when he would behave beautifully around calm people but then all crazy when an extra hyper person came along. I used to be so annoyed at people when I told them to just ignore the dog or BE CALM when he approached. 9/10 times they would not listen to me. They would either give my dog the attention it was looking for when it jumped up (‘it’s ok I don’t mind him jumping on me’) or freak out when the dog got close and start flailing their hands around and squealing (which of course the dog interprets as a game).
I remember thinking, it’s hard enough for me to try and communicate to the dog who does not speak human, but here I am telling a human in plain English what to do to help the situation and they are not listening! Why?!
I used to think it was the other person’s fault. If only they listened when I said to be calm, everything would have been fine. Then I went to see a professional trainer who made me realise that all those other people? They were all out of my control. I could not control how they decided to act around me or my dog, but I can sure as hell control my dog and train him NOT to react to them instead. So that is what I did… I focused on improving what I could control and change, the other people were irrelevant. What I am trying to say here is that my point on not blaming someone else and you taking control instead applies to many situations.
From experience, I can tell you that the cheap cake lady is usually quoting cheaply because:
1. She lacks the confidence or knowledge to quote correctly. Remember, that no one does this intentionally, nobody in their right frame of mind aims to run a small business to looe money. Chances are, she just does not know better or thinks that her product is not good enough to charge properly for it.
2. She thinks this is the only way to ‘win’ business. She has no idea how else to attract customers except for being the cheapest she can be.
3. She’s desperate for cash flow. People do all sorts of things when they are desperate for money. You might have even experienced it yourself… taking on the job when you know the customer will be a handful or reducing your quote because you didn’t have many orders last month.
4. It’s not her full time income and she’s just happy with whatever side income she can get from her cakes. There is nothing wrong with this. Her circumstances are different than yours so you can’t expect her to have the same drive and expectations from her business/hobby as you do.
It’s important to point out that although I am suggesting you don’t blame the cheap cake lady, you can’t ignore that she impacts your marketplace in a big way. The more she gives out those insane quotes, the more your customers start to expect that as the norm.
So then, what do you do when you don’t want to play her price game? This is where I ask you to say thank you to her, because this is where she will challenge you to up your business and marketing game.
You really need to think about how you show your customers why they still want to order from you. Have you been in business for a long time? Mention that! Tell your customers that in the whole time you have been in business, you have never pulled out on an order and have serviced over [insert number here] clients. So they have the confidence that when they order from you, their order is guaranteed. Give them the CONFIDENCE and ASSURANCE that their order is safe. Can the cheap cake lady who has only been in business for a short amount of time play on that level? Nope…
What are your strengths and what added value or services can you provide that will make it difficult for her to compete with you? Maybe you have the capacity to turn around large orders in a short time frame, have a wide range of products you can cater or you or your staff can even speak a second language… use that to your advantage!
This is the stage for you to start playing smarter and being more strategic. In my opinion, playing the price game is for amateurs… so are you ready to put your big girl pants on and play with the professionals?
I teach a business course with Michelle Green (of The Business of Baking Blog) and although pricing and costing is one of our biggest subjects, so is marketing. While we want to educate those who may be struggling with pricing, what we really want to teach you is how to be strategic and create a business that will withstand all the cheap cake ladies.
We run two types of business courses, a beginner and advanced one day course specifically tailored to those in the sweets business. These are run as live classes only because as you will learn, part of being strategic in business is making real life connections and networking.
Michelle ran a custom cake shop for 10 years and I specialised in wedding cakes for 4 years from home. These days both of us no longer do orders. Michelle mainly blogs and I mainly teach, but I promise you that even within this part of the industry we are in, the cheap cake lady still exists. Except to us, she’s not really known as the cheap cake lady… she’s known as the lady who will work for exposure, the lady who will write/teach for free or the lady who has no experience on the subject she is trying to teach/sell but does it anyway. The point I am trying to make is that the version of the cheap cake lady happens in any industry and she is the way she is for many reasons… so instead of blaming her… be better because of her.
Details and dates for The Business of Baking on Tour 2017 are below. Click on the countries to see more details, and take advantage of our special Early Bird pricing!
Australia & New Zealand
- Sydney 29/30 April
- Perth 10/11 June
- Melbourne 17/18 June
USA & Canada
- Ventura County (near Los Angeles) 30/31 August
- Montreal 2/3 September
- Jersey Shore 6/7 September
- Charleston 9/10 September
- Dallas 12/13 September
- Denver 15/16 September
- Birmingham 5/6 November