When you sell desserts to a café or restaurant, the price is built from two sides. From yours: the loaded cost of the cake plus what it costs to get it there. From the café's: what they sell a slice for and how much of that they need to keep. If what the café can pay covers your cost, the trip and your margin, there is a deal. If it does not, change the minimum order, the size or the dessert before you cut the price.
Step 1: your cost per cake and per slice
Start with the loaded cost of the whole cake: ingredients, cake board, box, your time and the oven. Divide it by the slices the café cuts. If the café cuts 12 and you costed for 10, your cost per slice is wrong.
Decide too whether you deliver whole cakes or pre-cut slices in individual boxes. Pre-cut slices add a box, a label and cutting time, but they make the café's job easier and fix the portion size. Cost both if you are asked for both.
Step 2: the café's side
Ask what they sell a slice for and the most they can pay for it. Every café does its own sums based on its rent, staff and waste, so do not guess; ask. That figure is the ceiling on your price.
If the café sells a slice for $7.00 and says it can pay $2.50 a slice, a 12-slice cake is worth $30.00 to them. Their margin would be (7.00 − 2.50) ÷ 7.00 = 64.3%. The markup and margin tool helps you follow that sum when a café talks in "times cost" or in percentages.
Step 3: the trip and the minimum order
Every delivery costs something: fuel or fares, and your time. That cost is spread over the cakes on that run. One cake alone may not pay for the trip; four will. That is why suppliers set a minimum order or charge delivery separately. The guide on delivery cost shows how to work out what each run costs you.
Step 4: shelf life, returns and payment terms
Three things to agree before the first delivery:
- Shelf life. How many days your dessert holds up in the café's chiller, based on your own tests. Put it on the label with the production date. A slice sold on day five when it only looked right until day three damages your name. The guide on shelf life and cost has the detail.
- Returns. If the café buys outright, what does not sell is their problem. If you leave it on consignment or sale or return, you are paid for what sold and what comes back is your loss.
- Payment terms. If you are paid at 30 days, you fund the ingredients in the meantime. Read the guide on selling on credit before you agree.
Worked example: cheesecake for two local cafés
You make a baked vanilla cheesecake and two cafés want to buy it to sell by the slice.
Your cost per cake: ingredients $11.00, board and box $1.50, your time and the oven $5.50. Total: $18.00. The café cuts 12 slices: 18.00 ÷ 12 = $1.50 per slice.
The café's side: it sells a slice for $7.00 and can pay you $30.00 per cake.
The trip: each delivery run costs you $14.00 in fuel and time.
| Cakes per run | Trip per cake | You keep per cake | Margin |
|---|---|---|---|
| 1 | $14.00 | 30.00 − 18.00 − 14.00 = −$2.00 | loss |
| 2 | 14.00 ÷ 2 = $7.00 | 30.00 − 18.00 − 7.00 = $5.00 | 5.00 ÷ 30.00 = 16.7% |
| 4 | 14.00 ÷ 4 = $3.50 | 30.00 − 18.00 − 3.50 = $8.50 | 8.50 ÷ 30.00 = 28.3% |
With one cake per run you lose money. With two it starts to make sense, and with four it works. A minimum of 2 cakes per delivery, or putting both cafés on the same run, changes the business more than any price tweak.
On sale or return. You take 4 cakes on the run. One café sells 10 of its 12 slices and hands back 2. You are paid 10 × 2.50 = $25.00 for that cake. You keep 25.00 − 18.00 − 3.50 = $3.50, well under half of what an outright sale leaves. If you accept sale or return, do the sums with what actually comes back and raise the price or the minimum to make up for it.
If you are paid at 30 days. You deliver 4 cakes a week at $18.00 cost each. Over four weeks you put 4 × 18.00 × 4 = $288.00 of your own money in before the first payment arrives. Make sure you have it.
The prices in this example leave tax out. Check your local tax rules, or ask an accountant, for how sales tax applies when you sell to businesses.
Before the first delivery
- Put in writing the price, the minimum order, delivery days, shelf life, who carries unsold slices and when you get paid.
- Label every cake or slice with your name, the production date and the sell-by date.
- Check each month what each café really leaves you, trips and returns included. A customer who orders a lot but sends back a third can leave you less than a small one who buys outright.
The guide on selling wholesale to shops and cafés covers the other terms worth negotiating, and if you also supply bread or pastries to the same cafés, see supplying cafés with bread and pastries. For the pricing method across all your sweets, see how to price desserts and sweets.
Do it with the calculator
Put the cake recipe, the slices the café cuts and the trip cost spread over the cakes you carry into the food cost calculator; it gives you the cost per slice and the wholesale price for the margin you need.
Frequently asked questions
How much should I charge a café for a whole cake?
Do two sums. From your side: the loaded cost of the cake plus what it costs to deliver it. From the café's side: what they sell a slice for and how much they need to keep. If the two numbers do not meet, that dessert does not work for that café.
Is sale or return worth it?
Only if you know how much sells. On sale or return you are paid for what sold and carry what comes back. Do the sums with what actually comes back, not with the whole cake.
Should I set a minimum order?
If every delivery costs you money and time, yes. Work out what a single cake leaves after the trip; if it is close to nothing, a minimum protects your margin.
Who takes the loss on out-of-date slices?
Whatever you both agreed in writing before the first delivery. Put the production date and a sell-by date on the label, and make clear whether returns are accepted.