Paperwork

I'm currently (and have been for over a month now) drowning in paperwork.

Maybe I'm being too thorough, if there's such a thing in this business, but I like to think I'm being super organised despite my dining table looking like a paper factory exploded on it. Maybe I was a little naive, I didn't expect there to be so much paperwork.

The way I see it my business paperwork has 3 stages.

First stage - the preliminary paperwork; price list, flavours, portion guides. This is the foundation, these are the things I need to know like the back of my hand and these are things I have sent out to every person who has enquired so far. It's been difficult. As mentioned in previous post there are so many variations on portion guides and everyone's prices vary. I think its taken me about 4 months to get mine figured out and there are still times I go back over it and Im not sure its 100% right. Truth is I could probably waste another 4 months of reviewing my prices and portions and still not be 100% that what I'm charging is correct. But for now it works. I know why I charge the prices I do and I know how I get to that final total figure I'm quoting, I'm not plucking it out of thin air, Im comfortable with where I sit amongst the local competition and that's important. I also have my own personal price and portion guide for every single configuration of cake I can think of then I have a simplified price guide which I send out to customers. Ive recently decided to have 2 seperate price guides. One for celebration cakes and one for wedding cakes rather than having them all on one.

Second stage - the ordering paperwork. Im still finalising these. As with everything, I think I have it then an enquiry comes in, I fill out my consultation form and "oh no, there no box for people who want to order cupcakes" and "oh dear, I have no box at the bottom that factors in delivery charge". So the consultation forms need work.
Every time an enquiry becomes a potential order, I fill out a consultation form with the customers requirements. As soon as we're agreed on a design and a price I move on to order forms. I have spent soooooooo much time reworking my order forms. There are so many variables with cakes. But what Ive recently decided is that Im just going to use my consultation form as an order form. All the information is already there. I also send out a copy of my Terms and Conditions which need to be read and fully understood before any money changes hands.
As soon as my customer is happy with everything on the order form, the details are all correct, the price is as agreed its time to send out the all important invoice. Again, Ive reworked my invoices soooooo many times. Remember I'm not trained in business or have any previous experience of running a business, I'm learning on the fly. Sure, Ive received plenty of invoices but they're usually for 1 item or a service, my invoices serve as a breakdown of costs. I signed up to paypal business. I figured it would be so easy to just send out a paypal invoice and have a record of it for when tax return day comes around. It was a good idea but not everyone wants to pay via paypal and they take a cut of all transactions so that was going out of my pocket. But it was good to see how their invoices look and Ive based mine on how theirs look.
Ive also been using googledocs. This way I can keep a record of my orders (split into monthly folders with customer subfolders) and share them with my customers and it means that most of my paperwork will be stored online rather than cluttering up my desk.

This has turned into a longer post than expected. I hope I'm not rambling and some of this is useful to someone somewhere. But heres the last bit.

Paperwork doesn't stop once that invoice has been paid. That isn't the end for me. My paperwork stops once the cake is delivered or set up. How much more paperwork could there be between the invoice being paid and the cake being delivered? Not much but these are the important bits.

Stage 3 - Delivery paperwork. I fill out an ingredients list as I make the cake. This includes all the ingredients, when they were bought and where, their batch number (if applicable) and their best before date and the date the cake and fillings were made.
On delivering the cake or if its being collected I have 2 copies of a cake information sheet. One copy for my records and another copy for the venue or the customer to keep. This basically details any inedible decorations, interior supports and boards, anything that needs returning to me, any set up instructions if someone decides to set it up themselves, cutting, shelf life and storage instructions and the all important signature to say its been received undamaged. This is mostly for wedding cakes but its good practise to do this for all cakes so I can get into the routine of doing it. It may seem silly, every cake Ive done in the past for friends and family have simply been collected or handed over, no paperwork involved but in the long run I'd rather have my butt covered that not in the event that someone damages the cake as they're transporting it  or setting it up themselves.

So that's how I'm spending my bank holiday weekend.....fleshing out the skeletons of all my paperwork. You can never be too prepared right? Now all I need to do is try to stay organised and keep on top of it.  I can totally see why people employ someone to handle all their paperwork. Its all a big learning process though and Ive been assured that at some point ill get into a flow and a rhythm to the point where its all second nature.

Price wars Part 1

Pricing is a difficult one. Everyone does it differently and seems to differ depending on which part of the country you're from. For example, cake prices here (and food prices in general) in Warwick are a lot higher than back home in Stoke-on-Trent. There's no way I could charge there what I charge here.

So how do you decide how much to charge? Its been important for me to look at the competition in the local area and figure out where I fit on the scale in terms of my target market and my skill level. I don't want to undercut anyone, there's no benefit in it in the long run, and I don't want to undercharge and end up losing money. If you start with low prices, its much harder in the future to up them, so aim high to start with. I'm self taught and have only been baking and decorating for about 5 or 6 years so I cant justify charging at the top end of the scale but I'm nowhere near the bottom of the scale either.

Now that Ive figured out what my local area offers and the price scale here, where I fit, who my target market is and what I think I could charge, how have I come to a decision about my prices?

Its taken me months and has been the one thing Ive gone over and over again and almost been in tears with because there are so many things to consider. It hasn't been easy.

First thing I tired to figure out was how others do it. So I took to google and typed in "how to price a cake". Let the confusion begin. Some people work out all their ingredient costs, price for boxes, boards, decorations etc they add on their utilities and then they add on their time at an hourly rate of their choosing. Others price per portion to come to a starting price for the cake. This is usually the price for it iced and finished with a ribbon. That price includes ingredients and all the other bits plus the time taken to make and bake the cake, trim it, fill it, crumbcoat it, ice it, ice the board, stack the cake and apply the ribbon. Decorations are extra. I work on a 3 day rule. Day 1: Bake, Day 2: Crumbcoat and cover, Day 3: Stack and decorate so you need to bear in mind how much you'd like to be paid for 3 long days work. I tend to start early in the morning and I quite often work late into the night on cakes and decorations. Its certainly no 9-5.

I chose the latter option of pricing per portion thinking it would be easy to find out how many portions are in a cake. Right?

Wrong! Portions guides are all different. If you look on google at portion guides they vary and some are not even close to what you could realistically get out of a cake. There are also lots of portion sizes and methods for cutting cakes and depending on which method is used you may get more or less portions. Confusing, no?

I figured the only way to be sure of  my portion sizes was to spend hours drawing on cake dummies. I decided on a price per portion and then came the difficult bit of deciding on how to price my decorations and also to think of all the different types of decoration that could be applied to a cake. I'm sure at some point someone will ask me for something I haven't thought about. This is the only bit I decided to put an approximated hourly rate on. It takes sooooooooo long to make decorations and I'm rubbish at estimating how long it takes, its always longer than I think. Its the time taken to get it looking perfect and a lot of the time it involves time consuming techniques or going back 3 or 4 times to add finishing touches. For example, filler flowers take hours. The process involved in making them includes colouring the paste, hand cutting and shaping them, wiring them and leaving them to dry, then taping them, applying them to the cake and then piping a centre.
I cant even count the number of filler flowers here but they took me HOURS.

Theres nothing worse than asking for a quote and the other person plucking a figure out of thin air with no clear breakdown of how they've arrived at that number, so once I felt confident with my prices, after months of reworking, I took out some cake books and had a look at some other websites where cake prices were displayed and applied my pricing to those cake to make sure I was confident and happy that my structure was right. I worked out that Ive placed myself about £100 cheaper than the top end of the scale and I'm fairly happy with that.

Ive rambled enough for now, there will be more on pricing in another post, focusing more on what to do when you get your first customer, how to quote and how to stay true to your pricing when the customer has a limited budget.

we have lift off

So a couple of weeks ago my new business, The Handcrafted Cake Co, officially started trading. I'm a total creative, love baking and decorating cakes which is perfect for someone like myself who is a people pleaser. What I hadn't considered was the fact I'd also need a good business head.

Prior to launch I'd been working behind the scenes for months. I started planning in January and aimed to be fully ready by May. Ha! Alongside my health problems, which I won't discuss here, and working full time and trying to have some form of quality time with my boyfriend, that time scale wasn't realistic. Launch day happened and I hadn't even pinned down my prices or flavours or got a bank account or typed out consultation forms and wait, I need terms and conditions just in case. ARGH! Paperwork overload.

I hadn't anticipated I would need to do so much paperwork. I keep thinking maybe I'm overcomplicating things but part of me hopes I'm just being thorough. I still have so much to do.

So far I have the skeletons of all the forms I need, it's taken me 4 months to figure out my prices but every bone in my body is still screaming "they're too high". No! I'm confident I've got them right. I've been over and over them and even compared it and applied it to other people's cakes. I've been careful not to undercharge or undercut my competition. I just need to be tough with myself.

I have business cards but in hindsight I wish I had invested in flyers instead. Live and learn I guess.

There's still this doubt in my head as well. Am I ready? Am I good enough? The simple answer is no. I'll probably never be ready but I'm a lot more ready than I was this time last year. My skills are far better, I know more about business and my confidence and knowledge grows with every project. I'll also never be good enough. I'll always want to be better. I will always look at someone else's work and wish I was that good. My boyfriend has a great quote on his whiteboard at the moment that says "Excellence withers without an adversary".

It's times like this that I love looking back at my first cakes from 5 years ago and realising how far I have already come on my own. I should be proud of myself. I really hope this works. I can't imagine myself doing anything else.......maybe travelling for a living? Is that a thing?

Business advice I've found useful so far is:
cake office
http://mrsbumble.tumblr.com/post/14970740279/names
And this book I've had for a while
http://www.amazon.co.uk/Small-Business-Start-Up-Workbook-step-/dp/1845280385/ref=sr_1_4?ie=UTF8&qid=1400098422&sr=8-4&keywords=small+business+guide

Check back to follow me on my business journey. Hold on! It's gonna be a bumpy ride.