Home Bakery Pricing — Menu, Rules & Getting Paid Properly
Pricing one cake is math. Pricing a home bakery is a small business: a menu where every item pays, rules you're legally operating under, and channels (direct, market, wholesale) that each need their own number.
Quick answer: Home bakery pricing in three moves: (1) every menu item gets cost-plus with honest labor — drop anything whose floor is above its price; (2) wholesale accounts price at 50–60% of your retail, so build that in from day one; (3) review prices quarterly — ingredients move and unpriced inflation is a pay cut. Check your state's cottage food rules before selling: allowed foods, sales caps and labeling all vary.
Build the menu around margins
Cost-plus every item (the bakery calculator handles the batch math), then rank by real hourly earnings. The items that pay your best rate get the photos and the front of the menu; the ones that pay worst get repriced or retired. A 6-item menu where everything earns is stronger than a 20-item menu where half the orders quietly lose money.
Cottage food rules (US)
- Most states allow home-kitchen sales of non-refrigerated baked goods under a cottage food license or exemption.
- Typical rules: direct sales only (no wholesale), annual sales caps, labeling requirements, no shipping across state lines.
- Some states now allow wholesale and colder items — rules changed a lot in recent years; check your state's current program.
- The calculator prices the cake; your state decides whether you can sell it. Both matter.
Wholesale without wrecking yourself
Cafés and stores ask for 50–60% of retail — their margin on your croissant. That's normal, not rude. What breaks bakers is treating retail prices as the baseline and discounting to wholesale: build wholesale in from the start (know both numbers for every item) and accept wholesale accounts only when volume repeats — a weekly 3-dozen standing order beats a one-off gift-shop consignment every time.
The quarterly review
- Re-cost your top 5 sellers (10 minutes with current grocery prices).
- Check your calendar: booked 3+ weeks out = raise prices 10–15%.
- Kill or reprice the bottom item — the menu's worst earner is a hobby, not a product.
- Update published price lists and pinned posts the same day.