Unicorngate: make cakes not war

I’ve not had the pleasure of meeting Natasha from Nevie Pie cakes, but I’ve followed her work for about 7 years now since I first started scouring Pinterest back in 2010 when I was looking for inspiration for my own wedding cake and came across her stunning hand painted cakes.  


I didn’t know then that I would end up in the baking industry myself, but was in awe of Natasha’s talent and unique designs.


Kudos to Natasha for recently gaining a listing with Harrods. Having gone through this process myself I've experienced first hand just how much time, effort and energy it takes to gain such a prestigious listing so I was so disappointed that her moment of glory has been overshadowed by all the horrible comments I’ve seen on various cake forums over the past few weeks about her unicorn cake.


It’s no secret that most of these cake forums are made up of home based cake businesses run by women. In a month where we’ve had a whole day set aside to celebrate women and their achievements, and all faithfully promised to support our sisters and have each others backs - it’s galling to see so many women come out with unfounded, spiteful comments about Natasha’s work.


These cake forums are full of threads from bakers bemoaning the fact that the general public just don’t get how much time & effort goes into making bespoke cakes, and that they are regularly expected to devalue their own work & in many instances work for a pittance, by customers who expect cheaper prices & discounts.

​These hobby bakers, who are reluctant to charge a proper price for their bakes in case it scares customers off.  And as a result so many of them keep their prices low, to keep their order books full. Effectively working for pennies, or worse, for free.

These are the same bakers purporting to know how much time its takes to make a cake like this, what the raw ingredient cost is, and therefore what ‘a going price’ should be, boasting that they’d only charge a ridiculously low price of only £40 for a similar cake.   


Well, when you’re a hobby baker based at home, you can probably get away with being a bit ‘relaxed’ about your pricing. This absolutely is not the case when you’re a business baker trying to run a profitable business.


When you make the move from hobby baker to business baker, everything changes. Supplying baked goods on a wholesale basis to any retailer, let alone alone the premium food halls like Harrods & Fortnum’s is a whole new ball park. With different rules & regulations, a whole heap of extra bureaucracy & admin, so many hoops to jump through which result in a whole set of extra costs that need to be factored in, if your aim is to run a profitable business. 


To give you a flavour of the true costs, based on my recent experiences of supplying iced biscuits to the likes of Harrods, Fortnum’s & other retailers these are some of the costs that need to be factored in:

Direct costs

• raw materials, flour, butter, eggs, icing 
• staff time, wages & national insurance, pension costs

Indirect costs (apportioned overheads)

• rent, rates, service charges, business insurance, utilities, water, website & IT
• membership/subscriptions, accountancy fees, legal advice,  producer margin 

The cost of bringing a wholesale product to market

• cost of gaining listing with retailer
• cost of undertaking supplier audit & gain compliance
• packaging, barcodes
• Nutritional analysis & labelling
• microbiological shelf life testing 
• product launch marketing
• promotions & instore tastings 
• Pallet deliveries to Knightsbridge
• VAT & Taxes​​

All these costs need to be factored into the mix to come up with the true ‘trade price’

The retailer will then add their mark up. Probably in the region of 2.5 times your trade price, sometimes much more. The retailer will have their own costs to factor in - staff, premises, insurance, marketing. The retailer put this all into the mix and set the retail price for which it sells your products in their stores. 

As a supplier, you get the opportunity to give the retailer a suggested range of RRP’s for your products. But let's be clear. Under competition laws, as a supplier you cannot set the RRP and insist on it. Once the retailer has purchased your products - its out of your hands. Within reason they can sell your products for any price they like. 
​

So you see, this is not about the cake having 'a solid 24 carat gold unicorn horn' to justify its price tag. This is what it looks like to make sure that after you’ve baked & decorated all the cakes, packaged & labelled them, ensured they’ve reached the customer safely & in one piece, completed all the paperwork, jumped through all the hoops, covered all your costs, paid yourself and your staff - you haven’t done it all just for the love of it. But actually made a profit.

At the end of the day a thing is worth what a person is willing to pay for it. Your customers may be different to mine, and my customers different to Harrods. What’s important is that we all understand our costs and price accordingly. What’s important is that we all know & understand our customers and price accordingly.

But perhaps what’s most important is that we all acknowledge that in this diverse world of cake & baking, whether you’re a hobby baker or business baker, whether you charge £60, £200 or £400 for a unicorn cake - there is room for all of us, to charge as we need to. 

So next time you see a cake that is priced differently to yours instead of getting the talons out maybe get the calculator out and try working through the costings to understand why it might have the price tag it does. And while you’re there, why not revisit your own costings too to make sure that it’s not in fact your prices that are too low, rather than the other baker’s prices being too high…?


Comments welcome below :)


Nila x

Natasha herself has written very eloquently about #unicorngate on her blog. I encourage you to head over and read her blog post.

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