Debbi Fields was only 20 years old when she became Mrs. Fields of Mrs. Fields Cookies. Ditto for Sir Richard Branson, founder of Virgin Records. But why wait until young adulthood to launch a company? Even young kids can start a business, and many are surprisingly successful. Take Henry Miller, who launched a successful honey business after he received a beehive for his ninth birthday, or Leanna Archer, who started an organic hair product line at age 11.
Entrepreneurship isn’t for everyone, but for the ambitious child, the benefits are many. For one, running a business offers learning opportunities that a school setting can’t, says Melissa Rose, president of Boxx Productions, a company that offers business strategies and ideas for young entrepreneurs. Owning a business teaches kids risk taking, financial competency, communication skills and a host of other “real-life” skills. “Entrepreneurship education has even shown to improve academic attendance and attainment while building a child's sense of self,” Rose says.
Additionally, young entrepreneurs have less to lose and can be more fearless, says David Bakke of MoneyCrashers.com. “Kids who have started a small business, whether it succeeded or failed, will have greater freedom in adult life,” Bakke says. “They won't be limited by the mentality that after they're educated, their only option is to find a traditional day job. They can also more easily start a small business on the side as an adult to earn more income, which also makes for more freedom.” Check out these tips to encourage your budding entrepreneur.
- Match an interest with a need. Whether you’re 6 or 60, one of the secrets of running a successful business is choosing something you enjoy. But to make it profitable, you’ve got to provide a service that fills a need, Rose says. Six-year-old Duncan Christensen set up a table on the path leading to the nearby school to sell old toys. He didn’t get many takers, but one girl commented that she would love to buy hot cocoa or snacks on the way home from school. Duncan liked baking with his mom, so he took the girl’s advice and switched to selling homemade snacks. He had more business than he could handle. Think about what you’re interested in and look around to find someone who needs what you have to offer.
- Focus on customer service. Old-fashioned customer service is still the best way to gain and retain customers, Bakke says. “Many adults still don't understand the importance of quality customer service in a small business, so as a child, it's definitely important to focus on,” he says. “Perform at a high level at all times, be punctual and courteous, and always thank your customers for their business. This is a great way to expand your business and build your reputation.” Teach your child how to communicate with clients politely and respond to emails and phone calls.
- Keep it simple. One of the great things about kids is their boundless energy and enthusiasm, but they often have bigger dreams than they can realistically accomplish. Encourage your little Donald Trump to start with one simple plan and execute it. You can always expand later, but it’s better to start small and build slowly than back out of a project that’s grown too large to handle. “Focus on what you do best and keep simplicity in mind with every aspect of your business, and you'll be much more likely to succeed,” says Baake.
- Find support. When it comes to helping a young child achieve a goal, most adults are happy to pitch in. Talk with teachers, friends and business colleagues about your child’s ambitions. You never know where support will come from. Support comes in many forms, including financial backing, advice, used equipment or marketing tips. Encourage your child to learn from everyone.
- Embrace failure. Almost every successful entrepreneur has experienced a few failed ideas. If one endeavor bombs, try another one. Each experience offers valuable educational opportunities and hopefully some fun as well.
- Market your product. Young entrepreneurs usually don’t have the funds to put together a full-fledged marketing campaign, but with a little help, they can come up with an effective strategy. Word-of-mouth advertising is a great way to start. Make business cards and ask customers to spread the word about your business. With a little help, kids can design fliers or even create a website.
Whether your child earns $20 or $2,000, the process of running a business should be fun and engaging. If it starts to feel like a chore, for either you or your child, it’s time to reevaluate. If the business begins earning serious money, talk with a financial advisor to understand your child’s tax obligations.