HOW TO MAKE MONEY SELLING CUPCAKES
How to Make Money Selling Cupcakes
You’re really good at baking cupcakes. And I bet all your friends rave and say you should start selling cupcakes. But the BIG question is: how to actually make money selling cupcakes.
I mean cupcakes are these tiny singular bite-sized little morsels. And yes, while they are delish, you may wonder how do you make money on a single cupcake. Well keep reading and I will share exactly how you can make money selling cupcakes.
Yay, you’ve mastered your baking skills, now what?
Seems easy enough just to say sell the cupcakes that you bake to make money but there really is more to it than just that.
Ok, so I am going to break this down for you to give you some perspective before you start selling cupcakes.
Although you love making people smile when they receive your cupcakes, you actually want to make money at this right? So I’m gonna tell you something you may know but you don’t want to hear – STOP GIVING YOUR CUPCAKES AWAY!
I know, you’re probably saying “well it’s family” or “it’s someone from church.” I get it, trust me…but your time is valuable and ingredients ain’t free! You have to tweek your mindset a little so others know you’re serious about selling cupcakes. Otherwise, you’ll always find yourself giving your cupcakes away for free.
Let’s consider these three things when making cupcakes:
- Cost of ingredients
- Cost of packaging
- Overhead/Labor cost
1. COST OF INGREDIENTS
No matter what you’re selling, you need to remember that you are fronting your own money to buy the ingredient necessary to make the product.
Remember, you still have to run to the store, use the gas in your car, go shopping and pick up all these ingredients. So let’s use the vanilla cupcake recipe below as an example.
Break down the cost of what you spent for all the ingredients used for your recipe. If you spent $28.00 for all of the ingredients, but you only used some of the ingredients, that’s great…you’re on your way to making a profit. Now, divide the cost of what you paid for the ingredients and what the cost of the ingredients actually was to make your cupcake recipe. This gives you an idea of what your food cost is to make an entire recipe of cupcakes.
Yes you will have leftover ingredients, but that’s great because you’ll need it for your next customer’s order.
2. COST OF PACKAGING
Now that we know how much you’ve spent for ingredients let’s talk about packaging.
You could keep packaging simple or elaborate, it’s up to you. Either way you still have to take that cost into account to actually make money selling cupcakes.
Simple cupcake packaging would at a minimum consist of a cupcake box. You may want to line the bottom with a piece of parchment paper so no oils soak the bottom of the box.
Another common packaging method would be cupcake inserts or plastic to-go type cupcake holders.
The total cost of the packaging for the cupcakes may be $24.99. Once again, packaging for the cupcakes normally come in packages of 6 to 12. You also have to add in the cost of cupcake liners which come in packages of 50 or 100 at a cost of $4.99.
3. OVERHEAD/LABOR COSTS
Lastly, let’s consider the price of overhead and labor cost.
When considering how to make money making cupcakes, you have to think about your overhead and labor cost. What I mean is, it does cost you money to turn on the oven right? You also have to think about the time it takes to mix ingredients, bake the cupcakes, and decorate the cupcakes.
How much is your time worth? If you were working in a bakery would you expect to pay yourself $15 an hour? How long would it take you to decorate a dozen cupcakes?
Well cupcakes don’t take very long to bake, but you still have to preheat your oven which may take 5 to 10 minutes. It may take 15 minutes to mix the batch of cupcake batter. Let’s assume 30 minutes to decorate the cupcakes and 5 minutes to package them up. That’s a total of about an hour.
So adding the approximate overhead costs plus your labor, let’s assume that total is $20.00.
The total of Cost of ingredients + Cost of packaging + Overhead/Labor = $50.00. If you breakdown the total cost you will come up with a general idea how to price your cupcakes.
Let’s assume you have a minimum order of 2-dozen cupcakes. If you divide $50.00 by 24 (cupcakes), that gives you a total of $2.08 per cupcake. It’s up to you if you want to round up or round down, depending on complexity but I much prefer to charge $2.50 – $3.00 per decorated cupcake. This gives you a better profit margin.
HOW TO MAKE MONEY SELLING CUPCAKES
So now you know what to charge for your cupcakes. Let’s talk about how to make money selling cupcakes. You know you have a great product, now it’s time to sell those yummy cupcakes!
Have you ever sat in a restaurant and had a waitress walk by with sizzling fajitas? You then decided to order that item off the menu. That’s because they are selling the SIZZLE and not the steak! Same holds true with cupcakes.
If you have amazing flavor combinations, decorations on top and packaging, that my friend is a winning combination!
Yes, you absolutely want your cupcakes to be spot on with flavor. However, if your presentation sucks, no one is going to buy your cupcakes. Sorry for the brutal honesty…but remember, I’m here to help. I’m that friend that tells you what you need to hear — not what you want to hear.
Sell your potential customers with up close photo shots of your cupcakes. Make them drool just by looking at your cupcakes. Once you get them to buy your cupcakes, they’ll no doubt loooove the flavors. In turn, they’ll rave to other people about your cupcakes and you’ll no doubt get more orders coming in.
And this my friend is how you make money selling cupcakes!
So are you ready to start making money baking cakes? Let me know what if you have any other ideas for selling cupcakes.
Happy Baking!
