Raising Entrepreneurs

Welcome back!

As I regularly point out to the parents in our Cash Smart Kids program (www.cash-smart-kids.com), opportunities for business education are everywhere.

I was out with one of my girls, aged 11 at the time, waiting for our pizza to cook in a small, family-owned pizza store by the beach.

She looked around, thought for a bit, and then asked “Does a shop like this lose money, or make lots of money, or just sort of balance out?”

“Well,” I said “They have to spend a certain amount of money on things like rent and wages, whether they sell anything or not. And they have to buy the ingredients, and if they don’t sell enough pizzas, they have to throw ingredients out.”

“Because they go mouldy?”

“They got too old to use, one way or another” (Discussion of Health Department requirements can be saved for another day!)

“But if they have too many customers they run out of ingredients.”

“Yes, they need to balance the ingredients so they don’t run out and they don’t have to throw too much away.”

“And if they sell lots they make lots of money?”

“That’s right.”

“So they have to get lots of people to come in and buy things?”

“Yes.”

“But we’ve been here for ages and only two other people have come in.”

“That’s true. But it’s still early – I’m sure lots of people will come in later tonight because it’s Saturday.”

“Still,” she said thoughtfully, “it’s hard. You can’t go out and get people to come in.”

“I’m sure they advertise, and put coupons in the newspaper,” I said.

She frowned.

“I think I’d rather stick with having an internet business,” she said. “It doesn’t cost rent to have a website.”

She finds that thought process just as interesting as the other thing she learned that same day, which was that the beach we were on was part of a sand spit joining an island to the coast. At one point you can stand on one beach, facing inland, and look down the street to see the other beach at the other end. She was fascinated.

All I did was to answer her questions (about both topics) in words that she could understand.

She still doesn’t have the vocabulary of an accountant – she couldn’t tell you the definition of fixed and variable costs, ROI, or expected return – or isthmus (the sand spit), or bombo (the island).

But she has the concepts, based on her own experience. Business concepts are so simple that a child can understand them, as readily as they understand islands and sand spits.

Now, it doesn’t happen by accident. Our mainstream culture doesn’t explain business ideas to kids in the normal course of events. However, once children have grasped the basic idea of how business works, learning more advanced business concepts is fun and interesting for them, so it’s worth getting the conversations going early in their lives.

One of the main ways that kids learn about money and business is from watching their parents, and listening to them talk. Often, what they listen to most is not the carefully planned teaching conversations their parents have with them – it’s the conversations that take place between adults when kids don’t even appear to be listening.

I remember learning as a child that sales is horrible. It’s a horrible thing to do, done by horrible people, in horrible ways.

Now do you think my father ever sat me down and said those things directly to me?

Of course not.

I picked that up from listening to what he said to my mother about sales and salespeople. Even more important than the words he used, I listened to the emotional tone of what he was saying.

At one stage in his career he was forced to work in sales, and he was miserable the whole time. He spent every Saturday in bed with a migraine headache, recovering from his awful week “in sales”. At other times, we were making a major family purchase, like furniture or a car, and he had things to say about the salespeople as we left the showroom. They will say anything to get a sale, I heard; they are all liars.

As you can imagine, having such negative attitudes about sales caused me some problems when I started out in business for myself!

My point is that we all pass on our beliefs to our kids, whether we intend to or not. If those beliefs are limiting, your kids will have to work doubly, triply hard, as I did, to reprogram themselves, before they can succeed.

You can give your kids a giant head start in the game of life if you deliberately explore and take apart any limiting beliefs of your own, while your kids are still young.

In the “Resources” section of the Cash-Smart Kids Members Area (www.cash-smart-kids.com) is a comprehensive checklist of limiting beliefs about money and business. You can give yourself a quick once-over, choose your favourite (or least favourite) limiting belief, and then simply apply one of the dozens of available self-help processes for shifting limiting beliefs. Repeat as many times as you choose ….