When my sister and I were kids, we used to have a lemonade stand at our grandmother's house on the Boardwalk in Newport Beach. There were always lots of customers walking, riding and skating down the beach front, willing to take a break from the summer heat and enjoy a refreshing glass of lemonade.
One day when we were about 7 and 8, we excitedly ran in to inform Grandma that we had made $38, a lot of money to a 7 and 8 year old, especially in 1978.
Imagine our surprise when Grandma took $8 from us and informed us it was for overhead. Neither of us had ever heard the word, and we were not pleased. Grandma told us that overhead was the cost of doing business - the cost of the cups, the napkins, the sugar, the water, the lemons, even the cost of the signs and flyers.
Confronted with this new idea, my sister and I quickly sought to put the best face on it. We argued that water was free. She told us that she had to pay the water bill. We then argued that the lemons grew on trees in her yard and must be free. She stated that she paid the gardener and again that darn water bill. I countered that it still had to be cheaper than the lemons from the store. She agreed and gave us back a dollar.
What did Coleen and I learn from this lesson? We learned that the amount of money you keep is more important than amount of money you make. Understand that Grandma did not need the $8. She was trying to teach us a lesson; one that both of us learned well. If you keep your costs down, your profits will go up and marketing effectively is imperative.
Using that knowledge, Coleen and I went back to the drawing board to consider what we could do to lower our costs. We made sure that any signs we made were effective and drew people to us. We wanted to know how they found us, and we came up with the idea of a to go price and a to stay price. We explained to any customer who asked that we had additional costs when they took a plastic cup with them as opposed to using a glass cup that could be washed and reused.
Little did either of us realize all those years ago what important lessons we learned about business, and they are lessons that we continue to apply in our businesses to this day.
It has made us analyze our costs and our marketing dollars to the benefit of our customers as we pay attention to what marketing is effective and what accomplishes the goal.
If you would like to discuss effective marketing that will expose your Newport Beach Home or Costa Mesa Home to the most number of buyers, please contact me at 714-319-9751.
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About the author: Christine Donovan is a California Residential Real Estate Broker with experience in assisting clients buy and sell residential real estate.
Are you upside down in your home? Is it worth less than you owe? Are you concerned about making your mortgage payment? For more information see Options to Foreclosures, understanding short sales or contact me at christine@donovanblatt.com to discuss your options.
If you want to buy a home or to list your property for sale, please click Newport Beach homes, Costa Mesa homes, Huntington Beach homes or Orange County homes. Click the link if you are interested in buying a home at a courthouse auction sale.
Contact me at christine@donovanblatt.com or 714-319-9751 to learn about her system which will make your buying and selling experience easier.
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Christine- This is one great read! I truly enjoyed getting into the story of these two little girls and the great life lessons they learned. What smart little ones you two were and still are. :) I am flagging this for a feature.
Nice story and nice grandmother, too. Lemonade stands are great for making money and invaluable for receiving your first business lesson.
Katerina - I am glad you enjoyed it. We learned great lessons. Thank you for flagging my post.
Mary - Lemonade stands are good for a whole lot more than we realize when we're kids.
Nicely written Christine!
Cameron Novak, Broker
The Homefinding CenterTM
Corona, California
Corona Real Estate Agents
Christine: What a great post. Nicely presented, and lots of good shared ideas. You were very fortunate to have a grandmother who was so much a part of what you and your sis were doing. Thanks so much for sharing.
Cameron - Thank you.
Karen - Thank you. Grandma was an important part of our lives.
That is too funny, it sounds like something Robert Kiyosaki would have done when he was a kid. Well done, Grandma, for having the presence of mind to teach her little cuties an important business lesson!
Christine - this is a good story about learning life lessons . . . I have had the same conversation with my daughters about "overhead"!
Carey - Better yet, we had no idea what we had learned until years later.
Sharon - I'm not sure if I would have remembered it quite so well if I hadn't felt the bite from the lesson.
Hi Christine;
We learned from our parents so we could teach ours.........Great Post!
Christine,
I remember my lemonade stand. The lesson I learned was that after over half the day went by my father brought my older brother out and wanted me to let him in on my business venture and give hime a share of my profits. So I learned early about nepotism.
Great lesson to be learned... and next time my kids want to have one, I will charge them for all of their materials. Maybe they will stop asking me to have them.
I hope your Grandma informed you of your silent partner in the family who was going to be coming around for his cut of the profits. Good old Uncle Sam. I also hope that your grandma told you about getting a business license and permits and how the health inspector would be by to make sure things were up to code. I hope she also told you about the hoops you would have to go through if you decided to hire a few kids in the neighborhood to man the stand while you took a break. You'd have to pay minimum wage, pay for their social security and other benefits, report all of this to the IRS. There's a lot to be learned from a lemonade stand.
I once explained all of this to my 7 year old son and he was pretty quick with his reply. He thought about it for a minute and concluded that we were just going to have to raise our prices. Thus he has already grasped the concept of inbedded taxes and compliance costs.
Christine......great story on life's little/big lessons that we carry with us throughout life. thanks for sharing.
Christine- Congrats on your gold star!!!!
A great lesson learned and memories for a lifetime. As a kid the only way I could recognize the value of a dollar was to earn it and I would certainly remember the loss of it! Smart woman! Thanks for sharing
Christine: It's funny how those life lessons often stay with us. And it's all good! Kudos to you for learning and applying always. Take care.
Paul
Awesome photo! Enjoyed reading the story and agree with the lesson... thank you!
Hi Christine, beautiful pic and I can so relate to your story. I started earning $ around the age of 7 or 8 shoveling snow, cutting grass, etc... I had no idea back then how much learning the value of a good work ethic would pay off. My overhead back then was very low! ;-)
Anthony - I only hope I've learned enough and can pass them on as successfully.
Larry - Isn't it amazing what you learn at the ole lemonade stand?
Judy - Or, maybe they'll surprise you and learn how to cut costs : )
Tim - I thimk she left that lesson to my mother as I helped her do data input and 1099's. Sounds like your 7 year old is very bright.
Pam - Glad you enjoyed it.
Katerina - Thank you for helping me stand out.
Connie - She was very bright and taught us many lessons. It's amazing how deeply most of them stuck.
Paul - Some of those life lessons definitely leave a permanent impression.
JB - I'm glad you enjpyed it.
Marti - A good work ethic is important. I wish my overhead was still $7 or $8 : )
CHRISTINE - Great lesson learned early on in life. I think that this is one of the most important lessons that is never learned by many agents. This is the kind of stuff that they should teach in real estate school, instead of worrying about things like "riperian rights," which has not come into play with any agent that I've ever met. Well-deserved featured post!
I bet...you thought your grandmother was mean, at first. But, it is sure sweet that you took this life lesson to heart and realized that your grandmother was....indeed....teaching you a life lesson and she did so out of love. Too often we are all afraid to teach these life lessons to our children because it is too hard...or because it would stress our kids out. Tough love is hard to give BUT it is so worth it in the long run. Great job Grandma and thanks for sharing the story.
That is a GREAT lesson your Grandmom taught you! She certainly knew what she was doing, especially the part about giving you a dollar back! BTW, Kat, love that smiley!!
Love the picture! And what a great way to learn what many people fail to grasp as adults. We need more grandma's teaching these lessons. Than maybe we wouldn't see so many "buy now, pay later" problems in our society.
Great post. I just did the same thing with my two daughters...they make $13!!!! But they spent $9 to make it. It took some quality father-daughter time to explain the concepts, but they're ahead of the curve now, since they get it! Thanks for sharing!
Great story and cute pictures of you and your sister. Terrific lessons to be learned on your first business ventrue!
Sounds lik the two of you were quite savvy, young entrepeneurs. Business 101 applies to even the most basic of business models. I am glad to hear that you are still an entrepeneur at heart. And how about your sister??
Adam - It was a great lesson. I agree, it's at least more practical information than riparian rights.
Your grandma was one smart lady! I think I will have each of my team members read your post. They all think the leads I give them are free!! What about the cost of the websites, SEO, on-line ads, 800 riders, and on and on? There is always a cost of doing business!!
Christine,
Based on your post I think you will get a kick out of the video I blogged about a few weeks back.
http://www.trumpuniversity.com/blogs/marketingmaestro/post/2008/06/the-lemonade-business.cfm
Enjoy.
Josef
Kat - I do have the selling bug, so does my sister. I love the smiley.
Pamela - We did think she was mean. It took years for us to understand. Now, with kids of my owm, I appreciate it even more.
Christine,
What a wonderful lesson for you and your sister. For us in real estate and mortgage business its crucial to know how to deal with costs and revenues to maximize our service profile.
Ronald - It was a good lesson and taught us to negotiate as well.
Kathy - I like the picture too. It was a great way to learn a lesson that was hard to forget.
Jason - Sounds like your girls are learning important lessons early too.
Judy - It was a great lesson and one I'm glad I learned.
Mona - My sister is one of the top agents in the Dallas Metroplex and has been for 10 years.
What a great lesson to learn so young - and what a fun way to learn it. I hope you are still having fun in your business.
Pat - I think sometimes people just don't realize the true cost.
Wish there were more grammas who were teaching their grand kids this lesson.
Josef - I did get a kick out of the video. Thanks.
Esko - I agree, knowing our costs is absolutely essential.
Virginia I am still having fun. I love what I do.
Bob & Carolin - We were very lucky.
Christine~Congratulation on being featured! I loved the picture of you and your sister! Your grandma sounds like a very smart woman......a trait she passed along to you!
I love it! :D
What a great story and a true analogy as to why someone should work with an expert. Great post.
Galel Fajardo
My partner was adopted when he was ten by his paternal grandmother. He credits his life to her, and after meeting her, I do, too. Readers can meet her at http://www.mywiseoldgrandmother.com.
We could all learn from our elders, as you did at such a young age, if only we would take the time to visit them, ask questions, listen, learn, and write down what they say, or record it, for posterity.
Pam - Thanks. She was a very smart woman and very successful in a time when that was unusual.
Galel - Life is just easier when you work with an expert.
Jim - What a wonderful tribute your partner has created.
I was lucky to have Grandma for as long as I did. We are a long lived family, and I was grateful to have her as a constant part of my life until I was in my 30's. It's been six years, and I still miss her.
Christine, it seems that from every type of media source, there are offers being made that will make your business grow, for a cost. I guess if we jumped at all these offers we would make a lot of money, but, now be able to keep much of it. AJ
AJ - I'm afraid if we jumped at everything, there would be little if anything left. I was reading another post tonight about testing and verifying the effectiveness of our marketing.
The Classic American Lemonaid Stand.........an american tradition...........and very sage advice from your grandma..........fair and clever........no doubt contributed to you being the business woman yo are today!
Liz - Definitely an American tradition. Grandma gave lots of wonderful advice, even if I didn't agree with it at the time.
Christine, you little entrepreneur you! Great job on the post and congrats for being featured in the AR News Letter. Great lesson learn by G-ma.
Oh what a wise grandmother you had to teach you such a lesson. A wonderful and encouraging story, thanks. We all in these times must learn to manage our funds much more frugally.
What a great story and lesson that was so important to you that you still carry it with you today! Excellent points!
If your Grandma is still living I hope you have thanked her for helping you learn such a valueable lesson that has obviously stuck with you all these years. That is awesome.
Great,
Grandma and Aesop's Fables, gathered a lot of wisdom there. What a happy looking couple of kids!!
Duane - Thanks. It was a great lesson and painfully hard to forget. Hadn't been through all my email yet. Thasnks for pointing out the AR newsletter to me.
Jackie - She was wonderfully wise. It's always important to be frugal, just more so these days.
Diane - I'm glad you enjoyed the story..
Dee Dee - I wish she was still alive, though through 92 years she shared much with all of us. I don't know if I thanked her for this particular lesson though I did thank her many times for all that she gave me.
Peter - It's tough not to have fun in Newport Beach when you're on the beach in summer : )
Christine, you are welcome on the New Letter heads up. :-)
Christine
What a great and powerful lesson your Grandma gave you and your sister ~ the money you keep is more important than the amount of money you make.
While I did not get that lesson from selling lemonade - I did get it from my Dad (God rest his soul) I can still hear him today ~ don't spend everything you have ~ invest it and your money will double every ten years.
Hi Christine...
I had a lemonade stand when I was a kid too. Only thing is I was a bit more clever than my Grandmother gave me credit for. I spent the extra 15 cents I had to replenish my lemonade with lemon flavored kool aid. I would then tell my Grandmother we didn't sell any stupid lemonade :)
P.S. There's a very strong chance I made all that up :)
TLW...ROAR!
Christine....Marvelous Post! My hat's off to you for remembering that lesson you learn long ago, and sharing it with us. It reminds me of my parents when I was in Junior and Senior High, and how they did not "rule with an iron fist" if I came home late. I think it made me a more responsible person, and never felt the need to sneak around from them. (Ok....there was that one time they were out of town and I had a bit to much and ended up at the local police dept....but that's another story!!!)
It's like taking typing in high school some 30 years ago....BEST, BEST class I took in all of school! It pays well for it self now since we sit on a keyboard for how many hours each day!!!!!
Christine..
great story remembered and shared. I liked Tim (from Atlanta) replay to you about the health inspector and needing a business license.
Stan Stepak
Real Living / Realty One
Northeast Ohio 440-476-0234
#1 in Avon Lake, Ohio
Duane - It's always nice to spread good news; isn't it?
Kathleen - Sounds like your dad taught good lessons too.
TLW - I'd venture to guess you kept parents and grandparents busy.
Thom and Ray - Sounds like there's a story to be told about "that one time" . . . : )
I'm with you on typing. Mom said it would be important. I just don't think she had any idea how important.
Stan - Tim's comment made me laugh, perhaps because it was so true.
Nicely written, Christine. Thanks for the post, I really enjoyed it! See you around the Rain.
Janie
Janie - Thanks. Glad you enjoyed it.
Christine - I LOVED this post. I somehow missed it the first time around. You had a very sharp grandmother indeed. I am going to include this post in the Family Ties recap today, and you just earned a new subscriber (me).
Whenever I see kids selling lemonade, I buy a cup. It makes them happy and I love seeing their face light up when I say I will buy some. Your grandma was a very smart lady.
Jason - I am glad you enjoyed it. I enjoyed the trip down memory lane and the reminder of what Grandma taught me. Thank you for including this in your recap and the new subscriber : )
Sharon - It does make the kids happy when you buy lemonade. They get absolutely delighted.
Christine, I found you from the star and being highlighted on family ties. Nice memory and story.
Karen - It's amazing what a little "advertising" will do isn't it? I'm glad you enjoyed my stroll down memory lane : )
What a cute story!! I really enjoyed reading it!! I hope you get the chance to write a children's story about this...parents would probably use it to teach a lesson that is not really touched upon with their kids!!
Chrislyn - I am glad you enjoyed it. The great thing is Coleen and I didn't even know we were learning a lesson though it's one we've never forgotten.
Hi Christine,
Too cute. Sounds like you had a pretty smart grandmother. BTW, I missed this as a feature, I just saw it on Marti's recap.
Christine, what a great post! It reminds me of the game "Lemonade Stand." It's a funny & addictive computer game where you price lemonade based on the weather report and news of the day. You set up in differnt locations and have overhead costs. It's a cute little game and a great way to run your own business :-)
Lara - First, thanks for being my first 100th comment.
Secondly, I've never heard of the Lemonade Game." I'll have to check it out.
Lynda - She was a very smart grandma and I was lucky to have so much time with her.
I'm glad you were able to find the post even if you missed it originally.
Christine, wow 100! That's a sign of a good story that touched a lot of people! Great picture too :-)
Lara - Glad you enjoyed it : )
Your grandmother was a wise woman...she taught you a very valuable lesson at a very young age!!! Something you have used for a lifetime...what a joy!
Sonia - She was a very wise woman who taught me many lessons. I wish there had been time to teach me more.