How Much Money Kids Can Make From a Lemonade Stand

Spring break and summertime are often busy seasons for kids and their parents, with camps and other non-school activities that fill the long days. One way to pass the time is to add a bit of a financial lesson to the mix – while also getting children engaged in the entrepreneurial spirit early on in life – is opening a neighborhood lemonade stand.

Whether it is placed on the corner of the block near home, curbside, or outside a busy park, operating a successful lemonade stand can be a great summer activity for kids and their parents, for fun, and to earn a few extra bucks.

The Economics of Lemonade Drink Sales 🍋

How much cash can be made from a lemonade stand depends on several different factors, the most essential being start-up costs. Kids have an opportunity to learn about the economics of running a business, including how much it costs to do so.

Startup costs for a lemonade stand can range from $20 up to $400, depending on how extravagant the business endeavor is.

Creating a Lemonade Stand With a Kid

Lemonade Stand Inventory and Equipment

On the lower end of the cost spectrum, children simply need:

• A few pounds of lemons to squeeze.
• Sugar to sweeten the juice.
• 1 pitcher to hold the lemonade.
• 1 large wooden spoon for stirring.
• 1 ladle for serving.
• Disposable cups to serve the customers’ drinks.
• A spare table or large cardboard box to set product and produce on, and transacting.
• 1 tablecloth.
• Paper to make signs for business advertising and to display prices.
• 1 money holder such as a wallet, purse, or waist pack (recommended).

Buying a Premade Lemonade Stand

When you purchase a prefabricated stand it may cost you a little more upfront, especially when paying for one on the higher end, but that should make it simpler to get started and stay afloat when you buy one that is made well and designed to be easy for both the parent and child to set-up and use.

Building a Lemonade Stand

It could get even more involved if you decide to try and build one with wood, but can look a lot more professional than a cardboard box and could end up improving sales and making it more fun for you and your child by building something together too.

Alternatives to Buying or Building a Lemonade Stand

You could also buy a fold-out table or similar to put products on and to make transactions, an umbrella to protect the young loved ones from the sun, and material for signage. However, that’s probably going to cost you more money than buying a pre-made one if you don’t have those items lying around the house.

Just keep in mind, the more expensive the start-up costs the lower the profit margin for your child’s business. Once start-up costs are calculated, kids then get to the fun part of the process – making and selling their summertime beverage!

How Much to Sell Lemonade For? 💲

Based on the size of the cup used to serve customers and the location of the business, kids can bring in anywhere between $1.00 and $5.00 for each sale. Over the course of a full day in a heavy-traffic area, kids could see between 20 and 50 customers, resulting in $20 to $250 or more in sales.

If a stand is up a few days a week for two months out of the summer season, this means potential revenue ranging from $480 to $6,000 and plenty of profit depending on how much you charge!

Lemonade Stand Revenue Breakdown

Here’s a very reasonable breakdown of how much revenue the child could bring in from a lemonade stand over a couple of months during the summer:

$3 average drink cost + 25 customers x 3 days a week x 8 weeks = $1,800

State and Local Vendor Permit Issues

Although opening a neighborhood lemonade stand can be a profitable endeavor for kids, it isn’t all fun and games when it comes to the legal aspects of opening up shop.

All but a handful of states require parents to obtain a vendor permit for a lemonade stand.

States That Don’t Require a Business Permit for Lemonade Stands

Yes, you read that correctly: a food service or business permit may be required if you live anywhere other than California, Colorado, Connecticut, Illinois, Louisiana, Missouri, Nebraska, Nevada, New York, North Dakota, Rhode Island, Texas, Utah, or Vermont; where you don’t need to have a permit to operate.

Whether you or your child actually gets ticketed is another story. I don’t think most police officers and other public officials want to bother little kids for making a couple of bucks. These laws are mostly in place so adults don’t try to game the system by creating a business for themself that avoids taxes and otherwise.

However, should your child open a lemonade stand without a permit, you could be facing fines of over a thousand dollars for not following state and local laws. This may sound absurd, but it is a reality in many locations.

Getting a Permit is Easy

The good news is that getting a permit is inexpensive and a relatively simple process. You can visit your local business and vendor licensing or permit office to request a temporary “pass” for your child’s activity, providing information on when the stand will be open, what business it will be engaged in, and its location.

Getting a permit comes with a small cost in most locations, but this is nominal compared to the price you – and your child – pay for violating the law. Plus, it will teach your child how to operate a business correctly, setting them on the right path for future success.

Double-check with your state, county, and city government offices to verify whether you do or don’t need a business license and vendor permit.

Having a Successful Lemonade Business 🤝

In addition to getting the right permit, should you need one, lemonade stands will be the most successful when they follow these tried and true small business tips:

• Price the lemonade to sell – not many people will buy a $5 cup of lemon juice, sugar, and water, so keep it close to around $3 to entice customers.
• Locate the stand in a high-traffic area to gain exposure.
• Share the reason for opening the stand with customers, such as earning money for a cause or to help pay for an upcoming camp or school trip.
• Tell friends and family about the business endeavor.
• Make yummy lemonade to sell!

Final Thoughts on Kids Making Money With a Lemonade Stand

Kids won’t likely make more than $100 per day by having their own lemonade small business, but they will learn the valuable lessons associated with being an entrepreneur and should earn a decent return on their investment (ROI).

Be sure to consider the costs necessary to get up and running and follow the suggestions for making a stand successful to create an enjoyable, valuable experience for your children.

Teaching Kids How to Save and Manage Their Money 💵

Once children start bringing in the cash, they may need somewhere to put it. Check out our guide to savings accounts for kids to learn about custodial accounts that allow you and the child to share a savings account together while earning interest on the income.

GoHenry also provides a ton of resources and tools to help your child save and learn about managing money.