Order for Two Thousand - HELP with Pricing!

Hello!! 

Hopefully someone will see this and maybe have some advice for me! 

I recently received a potential order of 2,000 cookies for a large, well known store.  Their marketing specialist has contacted me in regards to 2,000 cookies. They will all be round and with a white (maybe black too) base with a gold logo detail. 

This equals to about 167 dozen cookies. I'm slowly realizing my worth and do not want to lose myself if I'm chosen by this client, but of course this order is so large,  I feel like I have to discount.  

To my fellow cookiers, who are much more knowledgeable and much stronger than I am when it comes to pricing . . . do you have any tips or suggestions on what a fair price for this order would be?

I would typically charge $35 per dozen for this type of order had it been of a normal amount.  

Thank you to anyone who can help!  You all rock! 

MUCH COOKIE LOVE - SAMANTHA

Samantha

Original Post

@NOMI Just an FYI - You originally posted this question to our blog. Our blog is only for fully developed tutorials and articles and is moderated; our forums are the place for one-off questions to membership like this, and they are not moderated (so questions there post immediately). Anyway, I moved this question from the blog to the forums. Please read our "About" and "Site FAQ" sections for more information about where certain content goes on this site; this will help it land in the right place next time and hopefully get posted faster.

Regarding the actual question, discounting only makes financial sense when there are economies of scale in a certain business, meaning that the producer realizes some savings too by making things in bulk. You might have small savings in making  a lot of dough or icing, but only if you have very large mixers that allow you to do large batches. I rather doubt you can speed up the most labor-intensive (and therefore costly) part, which is the decorating. You may, in fact, have added decorating costs if you need to hire people to help you. One might justify discounting the order, just to get his/her foot in the door, especially if s/he felt this would be a large recurring order. But I personally wouldn't do this unless I knew I had priced the order profitably to begin with and that I could handle the volume and sustain that pricing over time, as once you've quoted a lower price to a customer, there is typically no going back.

That all said, the best way to price any order, be it small or very big like this, is to go back to the fundamentals of figuring out how much it's going to cost you to produce the order; then price to ensure you cover those costs, pay yourself and any employees a decent wage, AND also leave profit to go in the bank or to fuel investments in your business. The "Business of Cookies" section of our blog has some excellent articles about how to do cost-based pricing, and pricing in general, so you might want to check it out.

Let us know what you decide to do and how it goes. Best of luck!

I'm assuming they're not selling your cookies, that it's a promotional give away?  Maybe they just admire and respect your work and want to support local small business.  If that's the case, they're not expecting you to discount. 

If you want to build a relationship with them, think ahead to the next time and what you're setting yourself up for.  If you're thinking you'll get a lot of exposure so it's worth discounting for the advertising, we've all been there too.  How much business will you lose  because you have to pass on baby and wedding showers and birthday parties full of your specific target customers because you're busy making free cookies for people who would never, ever pay $3 for a cookie? 

It's a wonderful compliment to have been invited to bid and regardless of what you decide or whether you win the job, you can pat yourself on the back and enjoy the validation .

Add Reply

Likes (2)
Sweet Prodigy - ChristineWindshere1
×
×
×
×