Creative Entrepreneurship, Education

Lemonade stand business model evaluation

This was a nice memory from 10y ago: When most #kids ask about running a #lemonadeStand in their driveway, their #parents make it happen. I, on the other hand, taught them why it was a bad #businessModel . I was generous with how many people walked by our house too, ...

Screenshot of a skeumorphic era iPad app with boxes to fill out for various aspects of evaluating a business idea. Content in the boxes look like post it notes (yellow unless noted), and numbers are callouts with a hand-drawn background.

The boxes:

Key Partnerships: empty
Key Activities: Make lemonade, buy supplies
Value Propositions: Refreshing, tasty drink
Customer relationships: empty
Channels: Street
Customer Segments: People walking by the house (20), In town (0, purple)

Cost Structure:
Lemons $5
Cups $5
Sugar $3
Table, chairs, cooler $0
Permit $0 (purple)

Revenue Streams:
$1.50 cup of lemonade (10% market share) = $3
High traffic location = $0 (purple)

Loss: $10

This was a nice memory from 10y ago: When most #kids ask about running a #lemonadeStand in their driveway, their #parents make it happen.

I, on the other hand, taught them why it was a bad #businessModel .

I was generous with how many people walked by our house too, 20 was way more than the usual 2-3 but a 33% conversion rate (what % of people bought) was ridiculously optimistic and unrealistic.

Our expenses (Cost Structure) were for lemons ($5), paper cups ($5), and sugar ($3) for a total of $13.

Our income (Revenue Streams) was $3, from sales of two $1.50 cups of lemonade. I assumed that 10% of passers-by would buy a cup (ie a conversion rate of 10%).

The business would have resulted in a loss of $10 ($13-$3), not counting time & labor.

The purple post-its were for an alternative idea: selling in a high traffic area downtown – which required a permit (whose cost I don’t recall). That might have been profitable, depending on the cost of the permit.

This was a fun exercise that I hoped would teach the kids something interesting & useful.

#parenting #entrepreneur #unschooling #business

Arp Laszlo

Hi, I’m Arp! I got diagnosed with ADHD at 49, and now I'm trying to figure out what's me, what's masking, and just about everything else. I make comics (when imposter syndrome isn't striking) and write about life as a creative Indian-American. I’m self-taught, self-employed, and self-flagellating.