Cake Pricing and advance payment

Cake Pricing and advance payment

Today I am thinking about cake pricing and advance payment.

What do you call it when you ask for money up front when cake pricing?

When a customer agrees to pay you for your services, they will have agreed your total costs.

My question today is are you asking for money up front? And if so how much? Do you ask for a percentage of the total cost or a flat rate regardless. And what do you do about any delivery charge? Do you know how many miles away the venue is?

When cake pricing and advance payment is required – what do you call that?

Is it

(a) Deposit

(b) Retainer

(c) Booking fee

(d) something else?

If its something else – do let me know, as I love collecting ideas to help others.

Is it a ‘Deposit’?

Perhaps you chose a name of ‘deposit’ for the money received before starting.

However does this title suggest that the deposit could be refunded in the case of a cancellation?

 

Or is it a ‘Retainer’ of ‘Booking Fee?’

What if the money paid in advance was called either ‘Retainer’ or a ‘Booking fee’. Then this feels far less ‘refundable’ in the event of a cancellation.

 

That said – it is essential to have a set of rules or Terms and Conditions set out to give to your customers. This way nothing is left to chance and all parties know exactly what to expect and what your business rules are.

You are welcome to call the money you receive in advance, whatever you wish. That is provided that the customer knows what that money represents.

If it is a ‘non refundable’ depost – then make sure they know this.

A friend of mine who I studied my City & Guilds Sugarcraft with ended up running a cake shop. And her Terms and Conditions were constantly being amended. If a new challenge appeared that was not covered by her T & C then she would have it added.

So here is a hint.

If you are getting T & C drafted do not get too many copies of them printed at one time. They are a moveable feast – as it were – and there are bound to be extra items you want to add.

There is nothing more annoying to have to shred a load of papers because now the wording is out of date. I hope this has given you some thoughts about receiving money in advance. Plus some pointers to help you along the way too.

 

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