← The Entrepreneur
The Entrepreneur · № 06

Unit Economics

Calculated the real cost and profit on one product you sell, materials, time, fees, everything, and can explain the math to an adult.

The idea

Adults forget their hours cost money. Kids never knew. Have them list every input: cups, lemons, sugar, the hour at the table, the trip to the store. Divide profit by total hours. If they made $3 an hour, that's a real finding. Better to learn that at a lemonade stand than at a job they took because nobody ran the math.

Steps
  1. List every input: materials, fees, time at the table, time getting supplies, parent driving time.
  2. Assign a dollar value to time. Even $5 an hour. Time costs money.
  3. Calculate profit per unit and profit per hour. Both numbers.
  4. Explain it to an adult who didn't see the math. If they understand, your kid understands.
What counts

Your kid can explain the full cost and profit on one product, including their own time. A photo of the math is plenty.