Question for you: Are they pricing their lemonade correctly?! Not only is this a great book that kids love, but it also has some marketing concepts slipped in! Play can be so educational! In this case, it’s war! Two competing lemonade stands on the same street. Here’s my chapter book recommendation that just happens to have a lemonade stand theme. The Lemonade War (The Lemonade War Series) by Jacqueline Davies If your child likes money or wants to learn more, I really like The Monster Money Book that goes over basic entrepreneurial concepts just like our pricing the lemonade exercise but in a more fun way. Young entrepreneurs will relate to the unforeseen challenges of running a lemonade stand! Peg and cat learn that running a business requires fast and flexible problem-solving skills. No cups! More bartering is required in a complex transaction of cups for cookies, red peppers, and dancing. When Peg and Cat’s business picks up, they have another problem. It’s not easy to run a lemonade stand, especially when you are bartering for marbles. They made a lot of money that day too! Lemonade Stand Ideas for Young Entrepreneurs Picture Books Peg + Cat: The Lemonade Problem by Jennifer Oxley and Billy Aronson When PickyKidPix and Grasshopper and Sensei ran their lemonade stand, they charged $1 per cup (with the tiniest paper Dixie cup that you use for brushing your teeth) and gave a nickel rebate. Of course, pricing is also what the market can bear. So, if the cup of lemonade costs YOU $.25, you’d charge $.25 x 4 = $1 per cup.ĭoes this seem like too much? Well, you don’t have the same costs that a restaurant has like paying rent or hiring staff, so you can mark up your lemonade less if you like. In the restaurant business, you typically charge a mark up the food cost by 400%. Still, if he had to buy his own ingredients, he would be making … NOTHING! He is using very small cups so he might be getting 12 cups and since they are not disposable, he doesn’t have the additional cost for the cup. You can see that my son is selling lemonade at cost. In other words, our COGS (Cost of Goods Sold) for one cup of lemonade is a quarter. $2/8 cups (or more if you use small Dixie cups) = $.25 How many cups can you get from it? It depends on the cup size but a pitcher typically holds 4 pints or 8 cups. Or maybe you can use non-disposable cups from your house?Ī pitcher of lemonade is going to cost about $2. That works for me!Ĭups: Are you going to use disposable paper or plastic cups? If so, you’ll have to add in the cost for these. I can buy lemons in bulk to save money! You are thinking like an entrepreneur! Yes!!!.Then your cost is just sugar and you have a cash machine! I can grow my own lemons for FREE! Yes! Great idea.I know there are entrepreneurial kids out there thinking things like: We call that a “cost driver” because it basically determines the cost of your final product, in this case, a glass of lemonade. Note that lemons are your most expensive item. Let’s say you use two lemons and they each cost $2. Lemons: The price of lemons varies from 50 cents to $1 per lemon, I’m guessing. So … one tablespoon of sugar is basically a penny. Sugar: I’m going to guess that it takes just a few tablespoons of sugar to make one quart of lemonade. Ice: Let’s assume you’re getting ice from your freezer and not buying it from the grocery store. Water: Let’s assume the water is free from the tap. We’re going to start with basic cost accounting, which is to say, “How much does it cost you (assuming you had to pay for it yourself?” Let’s talk about how much you should charge for your lemonade stand. There’s nothing like an acronym to make something seem difficult. Pricing Lemonade for Your Stand COGS = Cost of Good Sold I thought I would teach entrepreneurial finance for kids today for my 100 Days of Play contribution by looking at pricing your lemonade stand. One thing that struck me is how much the pricing varies. Some have been selling lemonade and brownies. It’s been fun to support the neighborhood kids and sample their wares. With nice weather finally arriving in New England, I’ve seen numerous lemonade stand ideas pop up in my neighborhood. I’m thrilled to be joining Sun Scholars and 99 other bloggers for 100 Days of Play! Need play ideas? Please join us as we explore ideas for playful learning!
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