“When you ship an order of cookies, do you ship extras?” That was the question I posed a few nights ago to cookie business owners on my Facebook page.
Granted, this was hardly a Quinnipiac poll, but I did get a lot of answers rather quickly. In a nutshell, the preponderance of responders (or is it respondents?) said ‘yes’ to the extra cookie shipping. Isn’t that interesting?
You KNOW I have an opinion on this. And, let me preface this entire post by saying it’s ONLY MY OPINION! I’m not judging, preaching or telling you how to run your business by any stretch of the imagination. This is just a platform for discussion because, well, it’s an interesting discussion. Okay?
May I ask you another question? When ordering something fragile from Tiffany’s, Neiman Marcus, Sears, Walmart, Target, Amazon, Williams-Sonoma, or any other big retailer, do you get an extra bowl, wine glass, vase or dish? Do these merchants ship extras because they know the product is fragile and that breaks are inevitable? No, of course not.
So, why are you shipping free extras?
You told me you’re doing this in case some cookies break, like an insurance policy. But, you’re still giving away product and there’s no guarantee that they all won’t break. Want insurance? Then check off the little box on the shipping form that asks if you’d like your package insured. If there are breaks, your client can document them and you can claim the damages from Fedex, UPS, or even the Post Office, if I’m not mistaken, provided you’ve paid to have the package insured. Returning money or redoing the cookies (time permitting) shows great customer service on your part. Your clients will be grateful and are bound to use you again for another occasion.
Then there’s the ‘engendering good’ will reason. Think about it. Let’s say you charge $48 for 12 cookies. That’s $4 per cookie, right? Add two extra free cookies and you’ve just brought your cost down to $3.43 each. A difference of $.57 per cookie. Now, let’s say you have orders for 12 orders of 1 dozen cookies per month. If my math skills are correct (and notice I’m using easy numbers so I don’t get myself screwed up) you’ve given away 24 cookies and roughly $13.68. Multiply that by 12 months a year and bingo: you’re up to $165.00! And, that’s if you only make 144 cookies per month!!! I understand including a few bonus cookies to a client who orders frequently and hypes you to friends. But, new customers? I think you’re subliminally telling your clients that the price you’ve quoted isn’t the real price at all.
Which brings me to the next subject: the importance of proper packing. Bridget shares her packing expertise over here. I ship alot of cookies, but I agree with Dani Fiori who wrote that she only ships certain styles. I will not ship a champagne glass cookie. Even with a piece of cardboard slipped into the bag to shore up a structurally unstable design, I won’t do it. BUT, I do use a lot of bubble wrap, foam sheets, crumpled newspaper and FRAGILE stickers in and on every box I ship. And, when faced with a cookie disaster, I file the appropriate paperwork with the shipper, and then quickly return money or credit the customer. Thankfully, this hasn’t happened often. But, it’s happened.
It’s becoming more apparent to me that this cookie business has a split personality. It’s a business/it’s cookies. You and your cookies nurture and cuddle your clients/friends. You probably have a never-ending supply of taste-testers and reject-acceptors ready and willing to ‘help’ you out day and night. It’s complimentary, I realize that. But that’s not a business where goods are sold in exchange for money. I can’t imagine saying to a banker “hey, if you have any reject 100 dollar bills, I’ll take ‘em off your hands.” You wouldn’t dream of it, right? But, that never stops anyone from making mindless remarks like that to us.
If you have a retail shop and inventory is mounting up, slashing the price at the end of the day to move product is how spent money is salvaged. Donating to a food bank is a great way to get a tax deduction and build strong community relationships. But, as owners of small, custom order businesses, we don’t have inventory waiting to ship. We create new product for each and every order that comes in. And that can make it even harder to eke out a living, especially when clients don’t realize that labor is the major component of the price structure. Add to that the skyrocketing cost of ingredients! So, to me, I might as well tape dollar bills to my boxes, sooner than including the extra cookies.
Your clients have chosen to place an order with you because you’ve enticed them with the offerings on your website, and/or prior experience with your product. Many of you said you include the extras as a ‘thank you’. Does your butcher give you an extra steak to say thank you? How about the gas station owner; is he offering up a gallon or two to be nice? I thank clients, new and old, by sending a short email after their event asking if everything went well and thanking them for choosing me to create something special for their celebration.
So many of us open our businesses with wide-eyed optimism, only to be broken by the harsh reality of 15-16 hour days and very hard physical labor involved to sustain the work we love. It takes time and patience to keep the love in the cookies. And the money in the till.
What do you think? I’ll be right here waiting for your response.
I think I’ll have a cup of tea and an extra cookie while I wait.
I couldn’t have said it better myself! I have not gotten in the habit of shipping extras, and I really have no desire to. I have really enjoyed your business related posts recently. I love that you are an amazing artist, but you think like a business woman too. Your blog about not discounting your time, really hit home to me, and I have NOT been giving discounts to friends and family – unless I am giving the entire thing as my gift to them. I am new to this as a business, and I don’t want to set myself up for years of cheap cookies to everyone I know. I want to make people happy, and use my creativity to make cookies, but I’d also like to make some money. This cookie making stuff is HARD work! No joke about it! Thanks for your honesty and inspiration! Keep ‘em comin’!! -Hillary, a.k.a. The Cookie Countess
Gail, I appreciate all you have to say on this..and it’s given me food for thought (cookie for thought?). I am one of the ones giving an extra cookie or two as insurance, or as a thank you….but after reading your post, you have made me wonder if this is such a good idea. I sure wish the butcher would give me an extra steak as a thank you! As I’ve been getting better at packaging, (lot’s and lot’s of bubble wrap), I’m getting feedback that there is less breakage,….so maybe I should reconsider the extras. Thank you for this topic of discussion…and let’s hope a new way of cookie shipping will reflect in my profits.
ps….you are still the Goddess of Cookiedome!
Absolutely 100% agree. I never add extra cookies to the order…I only send what they paid for. I let my customers know that breakage can happen, its unfortunate, but they cookies will still be enjoyed. I also, do not ship certain cookies that have potential to break with thin appendages. I use lots of bubble wrap and double box and I have had wonderful luck with shipping, but of course, 1 or 2 from time to time can break.
I don’t have a business where this applies to me, but thought it was an interesting discussion. It would never occur to me to put extras in due to potential breakage, if that was the case, i’d just secure them better or like you said, don’t ship certain pieces that are more fragile than others.
As for the extras due for goodwill, I get that. I mean, somewhere along the line a baker gave a customer an extra bagel or roll to create the expression, a bakers dozen. Would I do it for every person every time? No, I don’t think so, I don’t think it’s right for a client to expect to get something “free” in every order, it would turn into a feeling of obligation rather than elation. I would use it as an opportunity to say “thank you” or “congrats” if the situation called for it.
As always, thanks for the chat!
Nailed it!
As usual Gail, you summed it up so well. First and foremost, it’s a business, and those pennies add up to big dollars at the end of the year. Miss you bunches—we need breakfast again very soon.
Amen!! You couldn’t have said it better. I do not give any extra cookies, or any extra servings of cake.I never get any extra when I order fondant, or sugar or eggs and I am a good customer! My clients get what they pay for. Every now and then I will give “something” to a repeated customer, but that’s as far as I would go.
As always, Well said! I am also new to this, but I’ve shipped cookies to several different states now (Thank you Briget for your packing tutorial…my packing is SO much better!) and it never came to mind to put extras in. I have said to the folks when they order “You want 6 dozen – would you like to purchase any extra cookies in case of breakage? They usually make it just fine because they are packaged really well, but if you’re counting on all of them being perfect you may want to add a few to the order as insurance.” People have been very receptive to this and actually order more cookies! However, when I’m done taking their order I make sure and separate their actual order from the “extras in case of breakage” on the order/invoice so that they’re clear on what they’ve ordered, the expectations are set & there’s no confusion.
z.
Oh, and I also learned the hard way not to ship alphabet cookies unless you want to pack the daylights out of them becuase they are very fragile!
What an interesting concept, from suggestion to packing the extras and separating them. Good for you, Zoe!
See! This is why you should write a book. You have so much business savvy to share that would definitely benefit the literally thousands of home-based cookie bakers out there.
I don’t ship cookies with appendages ever since I shipped golf themed cookies last year and a few golf clubs didn’t quite make it in one piece. I don’t add extras in an order. I sell my cookies by the baker’s dozen…the client is not getting an extra cookie as my cookies are priced by the baker’s dozen. Having said that however, as I mentioned in a prior post of yours, I know that I’m under-pricing (I’d feel as if I’d won the cookie lottery if could get $4.00 a cookie around here)but even though clients seem to always enjoy my cookies (I’ve only ever received positive comments about them) I know if I charged closer to what they were really worth in time, ingredients, packaging materials etc., I wouldn’t be baking very many cookies for paying customers anymore.
I never ship extras for the very reasons you cite, Gail!
…. everything is done by hand, and extras cost money too.
I ship as carefully as I can … remember to charge your customer handling fees to cover that cost
Cheers!
Susanna, thank you so much for your comment. You’ve always been one of my cookie heroes!
Handling charges are a must, as are ‘processing fees’, if you accept credit cards!
Great advice. As a novice who has yet to officially sell my wares (Texas is on the verge of passing a cottage food law), I probably would have shipped extras. But you as always make a great point. I think we all need to resist the urge to under sell ourselves, even as novices as long as we are competent at what we do. Anything less sabotages all of us in this business, and make no mistake, it is a business. I just shipped some (free) cookies to a couple of friends and family to test my packaging. I promise I will respect and honor all of you by not shipping extras should I be able to sell them in the future.
Loretta, we can’t overlook the value of ‘practicing’ on friends and family! Good luck to you! Hoping Texas passes that law quickly!
Gail, I think you make a lot of great points… You always do! I haven’t shipped that many cookies in the past, but in the few cases that I have, I haven’t thrown in extras. I agree that doing so is selling yourself short!
Once again, Gail, you are on point. I think most small business owners are a bit too caught between the “wanting to please folks” and “making money” sides of the coin. Especially those that bake and cook for a living.
But when you start looking at small pieces of the puzzle in dollars and cents, it makes much more sense.
I think one of the issues that enter into this is that often a cookie making business is an offshoot of a personal hobby and as a result, the owner has not truly moved into the realm of valuing their time enough. They’re doing what they love and they are making some money…more than they did when they did it for fun and just gave them away. They haven’t done their homework to determine a suitable wage and what it takes to earn that wage.
So it’s about moving into that realm of recognizing that they are in fact a business and checking those costs to insure they are getting paid what they deserve.
You made some great points Gail; the only additional one I would say is think about this like any other job. Would you stay an hour late at an hourly job just because you want to be nice and be liked and build goodwill? Probably not…you would expect to be paid for that work.
Expect the same from your hard work when you deliver a custom product; you deserve it!
Barb, it’s a rare worker who stays beyond the hours ‘just because’. Business owners? That’s a whole different time clock that gets punched.
Speaking from the other side, if I ordered cookies and got an extra, my first reaction would be to worry that I’d ordered the wrong amount. I’d suddenly be checking my invoice and double-checking the math to make sure I wasn’t charged for more than I ordered. Then I guess I’d consider it nice, but I’d never expect it.
I ordered yarn once from a company that gave me an extra ball because they were out of something I’d ordered. They also contacted me before shipping to let me know and check that it was okay. I appreciated the contact much more than the extra ball of yarn. It was nice of them, but not expected nearly so much as the professional contact.
In a nutshell, I don’t think reasonable customers expect extras, so it’s more than okay to not do it.
Gail-I will apologise ahead of time for being such a math geek
But, the math is actually a little more imposing than your initial calculations.
If you give 2 extra cookies away with each order using your cost/value of $4 per cookie, you are giving $8 worth of free cookies per order. IF you do 12 orders per month at that same price point that would be $8 x 12 = $96 of free cookies per month. Multiply that by 12 months: 12 x $96 and you have given away 288 cookies worth $1152 per year!
$1152…Now,that’s a week-long luxury cruise! And several margaritas!
Or in my case, (since I can’t get anyone to pay more than $2.50 per cookie down here in New Orleans) it’d be $720 a year to me and at least a 5 day Fun Cruise & a bucket of beer!
Thanks for an eye-opening post!
Karen, you’re correct..my formula should have been called something like the formula for finding the diminished value.
Thank you for exposing this in even more detail!!
I am a new reader (this week) and I totally agree with your post. It’s a business. Pure and simple. Great job!
I am not in the cookie making and selling business but I run a business where I teach cake and cookie decorating classes and I’ve had a few people tell me my classes are too expensive. I had to remind them that I have prep time of making the cakes or cookies and icing plus they get to take home all of the supplies they used in the class.
Bottom line – Don’t give your time away in any business unless you don’t want to make any money at all.
This was an excellent write up on how to run a business. Thanks for sharing your opinion – I agree with it.
From a cookier who ships quite a few packages a day, I can definitely with everything you have to say. It did take me a few months to realize this though ;/
Being a people pleaser, it felt good all around to include an extra bit of gratitude. Do you know that I never once got a message of thanks?! That is what actually forced me to change my way of thinking. We have worked those same 16-18 hour days for 2 years and have come to all of the same realizations as you point out. Smart packing is the answer. Confidence is the other. Thank you for pushing us all in the right direction!
Wow…I never looked at it that way. You’re absolutely correct! A few times, I’ve had to dig my heels, so to speak and gently remind a few customers that when they shop for shoes at Nordstrom’s they do not go over to the cashier and say “I want these shoes, but this is all I can pay for them.” I am guilty of including an extra cookie when shipping=/ After reading your post, I won’t be doing that again. I have been diluting my worth. Well said and thank you.
Hi there,
Not a business owner or cookie maker for profit but I do enjoy your blog. I must say that while I totally can see your points and many are valid, I agree with a previous commenter that the “extras” should not be eliminated entirely. I have reordered from several on-line vendors for various things because in the past they have included a “surprise gift”. I don’t expect it every time but because they valued me enough to include a little something, I continue to patronize their on-line establishment. Also, I have to say that my local stores often do include “extras” for my patronage. I have gotten extra “ka-bobs” from the town butcher; the deli counter workers at the food market often give each of my kids cold cuts & cheese to eat while I shop; our local bakery gives each of my 4 kids a cookie with out fail each time I go in there. So all in all, while it is clear that one goes into business to actually make money, it is equally important to ensure that the consumer feels valued. I promise you – they won’t forget it and chances are, they will keep coming back.
Thanks for the interesting post / dialogue.
Jennifer, you’ve made excellent points. Thank you for taking the time to write. Cookies for you!!!
I read your post a few days ago and was thinking about it last night as I decorated some custom logo cookies. With every order I make I always make extras not to give as free gifts to my customers but simply just in case I have a cookie situation like we ALL have had. So at the end of every order I find myself with a few extra cookies like maybe, 2 weddings cakes, 3 t-shirts maybe a shark cookie. If I don’t include these cookies in the customers box what should I do with them? Feed them to my kids bring them to a local shelter, I don’t want my kids eating 10 cookies a week and taking the cookies to a shelter would require work. Why not put them in my customer’s box?
You show a calculation that by including an extra cookie we lower our individual cookie price by $0.57, which might be right if we had someone sitting there willing to pay $4. for that extra cookie but we don’t. We only have a long list of other people to gift the spare cookies to; frankly I don’t want to bother looking for other people to give them to and I hate the idea of putting them in the trash. It’s not like we can have a cookie garage sale at the end of the year.
If we want to talk about REAL money wasted I suggest putting them in the trash or giving them to some friends or family that can’t even afford to order from you.
I always put my spares in the box and I have NEVER been thanked for it but I continue you do it, am I crazy? I’ve found that customers that are happy with their order will want to share the “cookie love” and will bring those spares to the office or to their friend’s house to share and I have gotten orders this way. Are we really giving free cookies away or are we putting our discards in the hands of the only people who will value them? Maybe consider adding a card to the box explaining why they have spares and how you chose to include them to thank them for their order.
Marlyn, I’m only trying to show cookie decorators who aren’t aware of how much money they may be giving away when they give extras. It’s hard enough to make a living doing this, and knowledge is power in my book. I’m not telling people how they should be disposing of extras, just trying to shed a light on costs they may not be aware of.
I give my extras to neighbors and friends who aren’t necessarily clients of mine. They’re known as my “waste management” team.
BTW, your work is magnificent. Absolutely magnificent.
I so needed to read this post! I’m so happy you wrote about it, it was so helpful. The points your brought up really hit home for me. I included extras in my last shipment because I made extras just in case I smudged my design or broke a cookie (I’m paranoid!) so I thought, eh, why not give it to them? I think you are right, throwing in a few extra devalues the rest of the cookies and makes the price seem arbitrarily set.
One Tough Cookie??? Uh, yeah…hell’s yeah.
Thanks for the great posts and reminding some of us that there’s a difference between confidence and conceit and to accept it (that’ll take a while!)!
Amen! I read this post last year, but SugarBelle’s post here brought me back for a refresher. Thank you. http://www.sweetsugarbelle.com/blog/2012/11/cookie-pricing-chart/
Great post! I’m a banker by trade and discovered that I could decorate a cookie only about eight months ago. I sat down several months ago to figure out whether I could make any money in a business like this. Having lent money to small businesses for many years now, I confirmed what I susupected and what you outlined here–I’d have to charge at least $4/cookie to make any reasonable amount of money! I decided to sell my cookies on a limited basis with no complications (i.e., no shipping, no delivery, no negotiations). It pays for my newly-found hobby, and we’re all happy.
You are so right. Like your Personal opinion posts, they always make me smile.
have to check the packaging thing for this X-mas.