An amazing resource for calculating recipe costs is Cook Keep Book. Even things like cake pop sticks and cake boards should be considered ingredients. Each item you sell will be different. Track your time and start computing hours for making your items.

Then you will be able to add the cost of that labor to your item. Including the cake drums, pie tins, little ribbons, stickers, and stamps, string, etc.

Be methodical here, every little bit will add up over time. Each item you sell will have different packaging and have a different cost.

A special promotion with cute packaging could be more. Use this general number and divide it by the number of items you sell in a month. If you work from home, divide a percentage of your household bills and make that your bakery overhead.

After months you should be able to get a clear idea of the bills. If you are baking a lot, you will see a rise in all of your monthly utilities. You should also calculate a percentage of your mortgage or rent into this total because you are putting wear and tear on your home and using its space to run a business.

If you are actually paying for a space to bake in, then the entire total of all the bills and rent goes here.

If you know your costs, you will know when your money is disappearing. A great resource for estimating your fuel cost if you are in the U. You will be surprised at how much time and gas you spend driving around for your clients.

Some people only calculate consultation time for custom clients or large orders where considerable planning is involved. Those costs should be considered. Divide the costs of this and divide it by items sold per month.

Now you take these numbers and use them to get your bakery pricing right. Hop over to my article, How to Charge for Desserts , to get the exact method I use for pricing my desserts. I look forward to hearing from you.

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