Managing a Cottage Industry

Jamie bakes and decorates cakes. Word about her cakes has gotten around, and she's being asked to do event cakes. She wants to keep it small and isn't sure how to respond.

QUESTION: Jamie in Florida is a full-time guidance counselor at a high school. She also bakes and decorates cakes. Word about her cakes has gotten around, and she’s being asked to do event cakes. She wants to keep it small and isn’t sure how to respond. Dave explains how to choose her clients.

ANSWER: Choose your clients based on two things. One is raise your prices, and some of them will choose to not be clients. Then you’ll make more per cake. The second thing that’s more important than the first one is choose to work with people you like. You’re not doing a big-enough volume to put up with a bunch of crap here. If you get Bridezilla, don’t work with her. Get somebody else to work with her. Just raise your prices. That’s what I would do. And choose your clients more carefully because you have no desire to grow this business much bigger than it is, and yet it’s growing. You can stop that by choosing your clients and raising your prices. You’ll get more joy and more money out of the business. I like that.