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Lessons from a lemonade stand

Whangamata Jan 2014

The quintessential Kiwi family holiday seems to include, at one time or another, running lemonade stand. So I was delighted during a recent week of holiday heaven in Whangamata when my kids discovered their inner entrepreneurship and took it upon themselves to open their very own lemonade stand.

There was no parental prompting but I did deduce that the pull of the local dairy and their new-found freedom to go back and forth without a parent accompanying them was a strong incentive to make some coin.

In part motivated by maternal overzealousness, fearful of abduction from the front kerb in the heart of Whangamata (yeah right) and perhaps in a larger part born out of my interest as a retail marketer, I watched the development of their enterprise closely.

What surprised me was not only how retail runs in the blood of both kids, (cue proud mummy moment) but the inherent steps they took to improve the offer for the shopper and what we could all learn from their approach – absorbing simple insights and making the complex simple. Great principles which as retailers we all too often turn on their head in our efforts to attract shoppers.

First they recognised the need for product, a store front and something to build awareness. Having successfully conned me into bankrolling a float and the first stock procurement (leaving me a little light on the lemon/lime for my daily vodka and soda), their attention turned to developing their poster and a cunning unique point of difference.

Anyone can make lemonade but HOMEMADE lemonade, made from real lemons, as the imagery showed, was presented on the street corner in an ice-cold chilly bin. The quality control bar was set high during product development and they then agreed it would be better if they ran back and forth to the house so they could hand make each drink so it tasted better, could be served in ice cold chilled glasses and also because people would know it was homemade if it didn’t come out of a jug.

Setting up for business

Business was a little slow sitting waiting for the beach goers to stop, so whenever a car stopped to turn the corner they jumped up to speak to the driver and any passengers.

Seems you can’t keep going if two kids are hurtling towards your vehicle and the theatrical disruption technique resulted in exceptionally high conversion. Doubtless lemonade was pleasant relief after the rush of fear experienced as small children were almost mown down.

Sale to a passing car – takes a while to wait for the driver to drink the lemonade to return the glass

Day 1 produced good cash and wide eyes. If we made this much money, gosh how much more could we make if we opened the stall earlier and bought more stock? So day 2 was even more successful although the stall closed early to allow for the all important trip to the dairy.

However, many of the previous day’s customers weren’t keen to buy another lemonade the very next day, at $2 a pop. Their response was “we bought one yesterday”. But my son had a stroke of genius while he was at the dairy.

Individual lollies and chocolates on offer for 10 cents each was a new concept for him. What if they expanded their product offering so those other customers had something different to buy? Also if he bought a pack of Hubba Bubba for a dollar and sold the individual pieces, he could make more money. Even better, mum had bought a 10 pack of Popsicles and 6 pack of mini Magnums at the supermarket, what if they sold them as well? Made sense given it was so hot and here were heaps of people at the dairy buying ice-creams. Brilliant.

Meanwhile my daughter thought that really nice customers should be rewarded for their good manners. They got some lolly pops and decided if someone said please and thank you then they would give that person a free lolly pop as a surprise.

Handcrafted, homemade lemonade

Day 3 saw an expanded product range and sales to new shoppers and repeat shoppers. Hubba Bubba wasn’t exactly flying off the stand but that was ok because the kids chomped away on the stock. They also moved the stand further down the road to make the most of people walking from town through the reserve, maximising the passing foot traffic.

Expanded range

As they split the takings that night, a penny dropped that they needed first to remove the float, which my son was now bankrolling as my daughter has a tendency to have money burn a hole in her hand, and only then split the takings. So they would need to keep a tally of what they started the day with and record the sales. Also it struck them if they knew exactly what they sold they would only buy replacement stock. After all, this was the stuff people wanted.

Day 4 saw a competitor enter the market in the shape of a girl who had been peering through the gate and window at them the previous day opened up on the opposite corner. She had a great set-up. Sun lounger, whiteboard, chillybin, homemade brownies and lemonade. And her lemonade was 50c. Heaps cheaper but as my son pointed out, probably wasn’t HOMEMADE as it was in a plastic jug. That didn’t seem to bother all the blokes from the building site next to her shop from buying drinks from her.

There was a lot of chatter at the beach about how they would blow her stall up. My son was adamant that the girl had to go. My daughter however had a glint in her eye. What if we sold our stuff with her stuff? She had heaps of people and their only cross over product was lemonade. At this point I donated a few words of counsel. You know shopping malls are very popular for a reason. But my son was adamant that he was going to win the lemonade stall war.

Sales were a little slow that day but then again there was a disproportionate amount of time spent at the beach.

Day 5 was interesting. The young girl, Maya from Hamilton, shyly crossed the road and asked if my two would like to come and put their stall with hers. She was staying with her nana all week and had no one to play with. She had cakes and brownie and if they wanted to do ice-blocks, lollies and lemonade she could do a lime drink. Interestingly a very quick, ok and terms of trade were exchanged and the new stall moved to the opposite corner. There was lots of laughter, chatter, eating of each other’s product and significant trade done that afternoon. It was such a delightful sight to see three little people scooter down the road to the dairy to restock for another wonderful day in the sun.

Last word goes to my kids though. They made good money and got to go to the beach .They especially had lots of visits from the builders which prompted my son, ever the thinker, my to ask, “I wonder how much money we could make if we sold pies for their lunch?” to which my daughter quickly replied, “But pies will melt all the ice-creams in our chilly bin”.

Collaborative lemonade stall trading

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