While lemonade stands aren’t a viable startup idea for most entrepreneurs, most of us could benefit from a refresher on small business lessons from this sector dominated by the under-12 set. Lemonade stands are a great way to teach a kid—and adults—the basics of running a business. Investment, costs, labor, and profit all play into building this simple enterprise.
Let’s take a moment to go back to where some of us began. Here are a few small business best practices you can take away from these budding entrepreneurs.
5 Small Business Lessons from Your Kid’s Lemonade Stand
Most of us were lucky to get 25 cents for a cup of lemonade, but now a thirst-quenching sip will set you back at least $1.00. Inflation aside, the value of lemonade has a price point and so does your product or service. If that Dixie cup of lemon-flavored water hit $5, would you open up your wallet or give those kids a lecture in corporate greed?
Small Business Lessons: Keep abreast of how much value you bring to a client. You obviously need to cover expenses, but charging too much will send your clients looking for another upstart at a cheaper rate.
Timing and location
Most lemonade stands don’t crop up in winter months or right next to a local watering hole. Kids are smart enough to know that their product moves best where there are thirsty customers—during hot summer months in neighborhoods with people mowing lawns.
Small Business Lessons: Know where and when your customers are primed to make a purchase and tailor your business strategy accordingly. Do your sales thrive in a brick-and-mortar location or online? Are you busiest during tax season or at Christmas? Try to master the ebb and flow of your business so you’re selling when customers are eager to buy.
Quality vs. quantity
A kid might think he’s incredibly clever if he waters down his lemonade instead of investing in quality ingredients. He may fool customers at first, but bad word of mouth and lack of repeat customers will hurt him in the long run.
Small Business Lessons: Your business may thrive on volume, but scaling up too quickly can easily result in poor workmanship or shoddy customer service. Watering down your product isn’t worth the risk now that customers can easily complain on Yelp, Twitter, or Angie’s List.
Beware of offering add-ons
We like lemonade stands because the product is simple and straightforward—lemons, sugar and water. But how eager would you be to add refrigerator art or a toy car to your purchase?
Small Business Lessons: Your clients probably know your small business for one type of good or service, so be wary of expanding into multiple categories. If you do add products or services, choose ones that fit with your existing brand and make use of existing resources.
Progressive can be profitable
Remember in the ’80s when lemonade was made with a chemical-laden substance from Country Time? Kids have gotten hip to the times and are offering organic, locally-sourced lemonade at their upstart stands. The smartest kids set up outside local farmers’ markets to target their target audience.
Small Business Lessons: Are your customers clamoring for sustainably-sourced materials? Do they expect your customer service call team to be paid a living wage? Customers will bring you their business if they know you care about larger, progressive issues.