When the summer heat spikes, there’s nothing as refreshing as an ice-cold drink. That’s why for generations of ambitious youngsters, running a lemonade stand has served as an introduction to entrepreneurship. As a 5-year-old, I set up shop one summer with my friend John, who lived near a busy park. We served hundreds of cups of lemonade that summer. (We should have kept it going in the years that followed. I could have paid for college!) Even back then, we understood that our enterprise was flourishing because of a few simple rules that we figured out on our own.
Parents, keep in mind that “children can be satisfied with small successes that don’t necessarily require much in the way of parental input,” says Kiplinger’s Personal Finance editor Janet Bodnar, who writes Kiplinger’s Money-Smart Kids column. The key, says Bodnar, is to keep goals manageable and fun. The practice kids will get in organization, independence and responsibility will prove invaluable as they grow up and pursue bigger ventures.
Here are five lessons entrepreneurs of all ages can learn from the all-American lemonade stand:
1. Pick the right place.
John and I would have served few customers if we had set up shop on my quiet street, so we decided to capitalize on John’s bustling neighborhood. We located our stand outside his house, directly on our hometown’s most popular jogging loop, and poured cup after cup for thirsty exercisers, dog walkers and families in the steamy weeks of August. If you live in an isolated area or if your next-door neighbor is already running a thriving business selling snow cones, look elsewhere for a highly visible space with minimal competition.
2. Take advantage of peak demand.
Kids inherently understand that demand for lemonade surges during the summer. But John and I sought to pinpoint the time of peak demand. We recognized that we would attract the biggest volume of customers if we operated our stand in the early evening, when other kids got home from summer camp and grown-ups exercised or walked dogs along the trail after work. To boost sales at your modern-day lemonade stand, set up shop when nearby events -- such as 5K runs, youth soccer or football games, and community yard sales – might steer dozens of thirsty neighbors your way at once.
3. Stand out from the pack.
John and I didn’t want to simply run a lemonade stand; we wanted it to be the best that our customers had ever stumbled upon. Beyond offering both classic and pink lemonade, we also sold water bottles, salty snacks and dog treats. Today’s kid entrepreneurs would be smart to offer a Wi-Fi hot spot and mobile charging station. Brainstorm constantly, study industry trends, and don’t be afraid to try new ideas.
4. Get creative with your marketing.
At the time, what our younger siblings lacked in math skills was more than matched by their limitless enthusiasm and sheer adorability. So rather than put them to work at the cash register, we taped signs on them that read “Lemonade!” and had them scooter alongside the running loop, hawking our products for all to hear. These days, you can ignite buzz on social media by spreading the word to family and friends in clear, crisp language.
5. Maintain good relationships up and down the supply chain.
Whether you’re running a juice stand or a hedge fund, don’t forget that good service never goes out of style. Deliver a quality product with courtesy. Hire staffers who believe in the company mission.
Extend similar courtesy to suppliers and employees, too. It may pay off in more favorable business terms or free word-of-mouth marketing. In the case of our lemonade stand, John and I reimbursed our parents for supplies and rewarded our siblings for their marketing duties.
10 Most Tax-Friendly States for Middle-Class Families
state tax If a move from one state to another is in your future, you could save big bucks by relocating to one of these states where the tax bite is light for middle-class families.
By David Muhlbaum • Published
Where Is the Economy Heading? Velocity of Money Provides Clues
Financial adviser looks at the rate at which money is being spent in the economy for an idea of whether we’ll see a recession in 2023.
By T. Eric Reich, CIMA®, CFP®, CLU®, ChFC® • Published
Reading, Writing, and Personal Finance
Raising Money-Smart Kids A growing number of high schools are adding personal finance to their curriculum.
By Sandra Block • Published
Best Banks for Families with Kids
Raising Money-Smart Kids Parents and children alike benefit from low fees and minimums on these accounts. But some features can be limited.
By Lisa Gerstner • Published
Planning Your Child's Financial Future
Brandon Copeland Atlanta Falcons linebacker and Kiplinger contributing editor Brandon Copeland talks about ways to set your child up with a strong financial foundation.
By Brandon Copeland • Published
5 of the Best Financial Gifts for Grandkids
gift ideas If you've been giving your grandchildren cash for the holidays, now is a good time to rethink that. There are other financial gifts that will help teach them the value of money and set them up for life.
By David Rodeck • Published
How to Talk About Money With Your Children
Brandon Copeland Atlanta Falcons linebacker and Kiplinger contributing editor Brandon Copeland discusses how to engage with children on spending, investing and other money topics.
By Brandon Copeland • Published
Readers Share Tips for Raising Money Smart Kids
Raising Money-Smart Kids What's the right age for a child to have their own credit card? Opinions vary.
By Janet Bodnar • Published
Best Banks for Parents With Kids
Raising Money-Smart Kids Kids learn the ropes of banking with dedicated checking and savings accounts from these online banks, and parents have impressive options for their own needs, too.
By Lisa Gerstner • Last updated
What Kids Need to Know About Finances
Women & Money In a digital world, it's even more critical to teach children how to handle cold, hard cash.
By Janet Bodnar • Published