6 Tips to Start a Kid & Parent Family Business

Kids and parents creating beaded jewelry for sale.

There’s plenty to do besides watching TV and playing video games, and a family business is a fun way to encourage creativity and confidence for kids and parents, alike.

Starting a family business isn’t all about profit. Sometimes it’s just about the fun of doing challenging things together.

For kids, learning skills like managing money, problem solving, planning, promotion, and publicity can provide valuable experience that they will surely put to use all their lives.

Here are six tips to help parents and kids get started with a family business.

1. Choose your business!

The first step is to see what your child might be interested in. He or she may have already expressed an interest, or they may just surprise you with their ambitions.

Kids may already have a business idea, but if they don’t, just make a list of their three most favorite things to do. This could span doing good deeds for people or animals, or making and selling an arts & crafts product. How about a backyard carnival, or teaching a neighbor how to skateboard, or offering a mini-course on safe biking? How about turning that safe biking class into an app? Get creative! Building a business is fun and the journey itself is always educational.

2. Set goals!

After you’ve chosen the business you and your kid would like to start, set a date for when you want to launch. Then work backward from that date. What will you do to announce the business? Will you need a sign and paper flyers, a video, or a web page? What equipment will you need? For example: for a lemonade stand, you might need a folding table, paper cups and a pitcher, and lemons. How about ice?

What is your goal for the business? Is it to sell a certain amount of your product or service? Is it to make a certain amount of money for a school or charity? Write the goal down at the start and compare it to your results when the project is completed. If there is room for improvement, you can take this experience to the next project.

3. Fuel up with funding!

A family business is a good way for kids to learn money management skills like making change, subtracting costs from sales totals, and keeping track of these numbers should any taxes be due. Check with a tax professional to determine if there could be any tax obligation, should you succeed beyond your wildest dreams. You may also need a license from your city or county. Check your city and county web sites for more information.

Practice “banking” by making a loan to the new enterprise. The child should participate in determining just how much is needed, and a schedule of repayment could be written and signed by both parent and child.

4. Get customers!

No matter how large or how small, learn to tell the story of the enterprise, and to make the product or service interesting to the potential customer. This is also the time to learn how to listen to the customer, to try to answer any questions they may have, and also to be patient should the customer’s comment be less than glowing.

5. Form your company!

If your business succeeds, you may want to (or need to) form a company under state or federal law. This could be one of a few forms of for-profit corporation, non-profit corporation, or a Limited Liability Company (what’s often called an “LLC”). A local business attorney could volunteer their time to consult with your family about which is the best business form – especially if the company does charitable work.

6. Have fun!

In starting a kid/parent business, always keep in mind that entrepreneurship is about planning and learning, and making mistakes – and fixing those mistakes in the same business or the next one. Always do honest business. Make friends that could last a lifetime. Have fun.

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