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This is the most important lesson I ever learnt about running a business. More importantly about me as a person and how I treated myself:
Don’t sell yourself short.
I know it is one of the oldest clichés in the book, but hear me out. When I first started producing work and products to sell I thought that I couldn’t charge for them because I knew they would be so bad. I undervalued myself from the word go.
I was charging £25 for cakes that took me all day to complete. I would get to work at 9 AM and finish washing up and cleaning down at 6 PM, for one cake. This didn’t include the time it took me to buy the ingredients, work on the design and discuss the work with the client. Bare minimum, it would be a day and a half of work and I would get paid £25. This would give me a profit on the cake of £12 maximum, but this didn’t come anywhere near to covering my daily rate.
Here’s something you need to understand about cake. People do not get it, they don’t understand how it can cost them £50 a cake if they think they can get exactly the same thing from Tesco for £12.50. Because I didn’t value myself enough I would sell my cakes at a competitive price and throw my own needs out the window in the process.
Undervaluing myself led me to make one of the biggest mistakes in my business journey. Well, 'mistake' may be quite a strong word but it was definitely the most challenging period in my business.
Let me set the scene for you.
If I’m honest, I hate talking about this but I know it is important to talk about and document. Mainly for myself so I don’t make the same mistake but maybe for someone else who could find themselves in a similar situation.
I had just started work, I had received a couple of orders here and there from friends and family. I had been incredibly nervous but I had managed to pull through and I was ready for more. Things were too slow for my liking. A family friend reached out to me and said she worked at a bakery that needed a new cake supplier. This seemed like the perfect opportunity for me as I needed a way to get my name out there and have the space to produce a high volume of cakes. This would mean I could perfect my cake baking efficiency and get paid.
I was so excited for the new opportunity and I quickly organised a meeting with the person that owned the café. When we sat down for the meeting I was so happy. We really got along and were able to talk about food and cakes and patisserie. I was sure I would be providing cakes. I left the meeting and made a cake price list as soon as I got home.
This was when things went a little awry. It turned out they didn’t need me to make cakes as they already had suppliers. They wanted me to make tarts. I hadn’t made a tart since cookery school but I knew I could produce them pretty easily, so I wasn’t too fazed. I sent out a different price list for the tarts. This was when I found out they didn’t want tarts, they wanted tartlets, and I was too expensive for them. I came up with more prices for tartlets and I was still too expensive.
Every time I sent them revisions they made me lower my prices. It took a lot of back and forth for them to finally tell me the price they could afford to sell the tartlets at, it wasn’t good. By the end of the correspondence, I was set to sell them the tartlets for around £1.25 a pop. This meant I would make 60p on every tartlet but it didn’t come close to covering my labour costs. Their first order was for 40 tartlets to be delivered in two days’ time.
They also wanted four samples of the tarts. This wouldn’t normally be a problem but it meant I would have to drive the samples over which would take no less than an hour and a half to get there and back. Trying to do this in the middle of a huge order was a ginormous inconvenience for me. The better option would be to give the samples if they were so worried and proceed on from there if they were happy, not do it halfway through production.
After dropping off the tartlets, I slaved in the kitchen for two days straight, only heading home at 9 PM after starting the day at 8 AM. I managed to complete all of the tarts and I woke up at 6 AM on Thursday morning in order to drop off the tartlet order. I was exhausted. The worst part was I knew I was only going to make £70, with only £50 of that being profit for two days work. That worked out to £25 a day and with the 12-hour work shifts this worked out to £2.08 an hour. I was demoralised.
However, I realised this was my first time doing such a big order and I would become more efficient as time went on and hopefully it would mean I could spend less time on the tartlets making the process more worth it. Right? Wrong.
After collapsing in a heap after my two long work days I woke up to a barrage of texts from the owner of the café. Scalding me about the tartlets. Saying the pastry was too pale (this is how I was taught to make the pastry, it was cooked through and delicious just white and not brown), the filling was cracked (the pumpkin tarts suffered the 40-minute car journey, as pumpkin tarts do), this was not a good enough standard. In the end, I received a text asking whether I, ‘had even made them before.’ In short, I broke down. I had worked my arse off, had not slept because my dreams were plagued by tarts but I had thought, don’t be silly, the tarts are of a high standard!
I wanted to give up then and there, I was so exhausted, I was totally distraught but then… I got another text.
“We’ve sold out of tarts, I need a follow-up order.”
Yeah. You read right. I think any other person would think ‘this is a bit weird and erratic.’ In hindsight, I can see it too. But at the time I was just so relieved that I wasn’t as awful as I thought and that people wanted more of my products. Even though I was strung out, I hauled myself out of the house and completed another rush order for the next day. I woke up at 6 AM and I was out the door with these tartlets.
This business relationship continued for almost 5 months before I threw in the towel. I learnt so much of what not to do. It was probably the best thing for my business as it taught me the most important lesson— never undervalue yourself. I made these tartlets for absolutely nothing. When I eventually got to provide cakes, I was allowed no creative input and was asked to produce the exact same cakes from very specific recipes which I really did not enjoy making. At the beginning of the relationship, I had been promised advertisement with my tartlets, a little notice talking about my company to give me more business, unsurprisingly this never happened.
If I had taken one second to stop and think about how little I was being valued and the amount of work I was putting in for the amount I was getting paid, I wouldn’t have dug myself into such a hole. I would have given myself more creative room to develop. Perhaps, it wouldn’t have taken me so long to design my new line of cakes that I am so passionate about and so proud of.
What I am trying to say is in business, people aren’t going to be nice. Never expect them to be good and decent because you had a good conversation with them once. You need to be ruthless in protecting yourself. This doesn’t mean you should bite the heads of your competition or take advantage of people yourself, you just need to learn to look out for yourself and your interests. Hold your head high and don’t be afraid to value yourself highly, because trust me— if you don’t, nobody will.