This is a guest post by Scott Rodgers of Digital Marketing Engineer. We had a conversation Tuesday evening at the Front Range Bloggers Meetup Tuesday evening about entrepreneurship and here he recounts the story he told me. I had to get him to write it. Thanks Scott.
Kevin, I had a conversation with a mom recently that made me think of you and I thought I would share. She came to me with an interest in creating a web business with her son — the primary goal being that it would serve as a vehicle to allow her son to experience a business as he was growing up. As you well know, this can build a meaningful perspective of money, business, employment and a sense of empowerment. This conversation made me think of my own experience as a kid…
My mother owned a business for 20 years and employed nearly 50 people at its peak. I grew up doing just about every job, including the ones people would not want to do (who else would you ask to paint the outside of the building on a sunny 97-degree summer day?). The experience of hearing about business at the dinner table and working primarily during my summers off from school quickly had an effect on me.
For example, when I was in 6th grade I observed that my schoolmates were willing to pay $1 for a pack of gum I got for $0.50. It probably started with someone asking for my gum and me saying sarcastically, “yeah right, I’ll give you my gum for a buck.” Followed by them saying, “okay.” That observation did not go unnoticed. I ended up going to Walgreens and forking out a whopping $10 for gum and candy. This was the late 1980’s and in those days $10 bought an impressive pile, to the point that the clerk asked if my mother was aware that I was buying this much candy. Concerned she would not sell me the candy I needed to make a nice profit, I said something like “um, sure, how else do you think I got the money to buy this much candy?” (Believe it or not, I saved it, and my parents were not aware.) It worked. I had my bag of goods and was unknowingly on my way to running my first business. During the bus ride to school, during breaks, and yes, I imagine even during class, I proceeded to sell $0.25 packs of gum for $0.50 and $0.50 candies for $1. Doubling the price and rounding to the nearest quarter or dime was fairly easy to do, so that is what I did. At first I was amazed so many people were willing pay DOUBLE what I paid for something they could easily get in a few hours. This was my first lesson on what every NFL stadium concession stand and ski area cafeteria know all too well: people will pay up for convenience.
So, what started as a few bucks invested in a pile of candy soon became a refined process of buying candy in $15 increments and earning $30. I probably went to the store every week for several months. So how much did I make in 6th grade? Well, therein lies the funny part. I didn’t know. My ability to generate revenue came before my accounting skills!All I knew is that I made quite a bit more than what I was paying out, and how to make the process work. As long as the cycle was sustainable, did it really matter how much I made? It was in the right direction. Fortunately, I kept a log of events: bought candy on x date for $x, made $x from that candy, rinse and repeat. A year or two later I reviewed that log and realized I made about $300! To a kid with zero expenses and a modest allowance, that was a ton of money. What was even better is that I had control over it. I did not have to go to Dad with my hand out and say “can I have some money?” All I had to do was spend $15 and earn $30. Although, by spring I was tired of people asking me for candy, I just wanted to be a 6th grader, so I stopped. A couple of my better “customers” tried to take my place, but I think they ate too much product (I rarely did).
A few years later I graduated to shoveling walks. On a big snow day, when we were told to stay home from school, I could make $100. In one day. My costs were still zero — talk about a nice margin and return on time!
It’s crazy to think that, in relative terms, I was the richest and probably smartest I have ever been when I was in 6th grade. So parents, what are you doing to empower your kids to own their future? I only hope I can be so lucky again.
BIO: Scott later went on to build a $4M online media business, as the corporate web manager, for a broadcast company. Scott now consults as Digital Marketing Engineer a and helps small businesses, entrepreneurs and professionals use their web presence and web marketing to grow their business. Mention this blog post and he’ll give you a complementary pack of gum for every web project