Wednesday, July 2, 2008
Making Money
I'm trying to figure out how to get $45 in a week and keep on making $5 a week for two months. I plan to spend the initial money on a subscription to LEGO Magazine. The rest of the money is for future savings. Please comment here with your ideas of how it's possible. My deadline is August 31, 2008.
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3 comments:
sell some toys in a garage sale!
Well, it won't make you $45 in a week but if you never, ever spend your coins and keep them in a jar, it will really add up quickly!
Will require some assistance from your mom (sorry Rebecca!), but here's an idea:
Sell lemonade. To make $45 in a week, you will need to sell 18 units at 50 cents each for every day of the work week (5 days - 90 units total). In order to move lemonade at that price for that many days in a row, you will have to provide value to your customers - icy cold, and large quantity per unit - reasonable amount would be 20 ounces per unit.
Now here's where business gets tricky, but if you think about it, you can plan for your expenses. How much does lemonade (your product) cost to produce? What will you need? Let's see:
water (free)
ice (free)
lemonade mix (~$10/34 quarts)
cups/bottles (need to obtain pricing)
transportation to/from your "sales locations" (negotiate with your mom - sorry Rebecca!)
If you offer a 20-ounce product, how much lemonade do you need to purchase to get started (this is called "capital cost" or "startup cost")? How much will you need to sell before covering your initial costs and you can start recognizing profit?
For the sake of your situation, let's assume you can obtain a zero-interest loan from your parents (sorry again, Rebecca!), with a payback date of two weeks after receiving it.
You might need to borrow a calculator and have your mom check your math. Figure out how many quarts you need to produce your initial week's sales - 18 units/day times 5 days = 90 units
90 units times 20 ounces/unit = ???? ounces. 1 quart = 32 fluid ounces. How many quarts will you need?
This will get you the money you need for the first week, but you will still owe your lender (a.k.a. your mom) your capital cost loan. Your following weeks, since they don't require the same net profit, can be used to repay your loan with the same or a little less sales quantities.
You also need to think about where you will be able to sell this quantity of lemonade, on a consistent basis (market research). Examples of market segments that might work: Find a construction site where there are a lot of hot and thirsty workers, or set up a stand near the football practice facilities at your local high school.
Businesses all have the same operating model - determine a need, figure out how to fill the need profitably, convince your prospective clients that you are the person to fill their need.
Good luck!
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