Posted by: kevinliebl | June 20, 2009

To Improve Business Profitability, Bring Back the Paper Boy

PaperboyWhen I was in fifth grade, a seventh grader was getting ready to give up his paper route.  There were about five boys trying to get it from him. I gave him one of my skateboards and he gave me his route.  I had just bought my first business.

Once I had the paper route, I felt like the captain of the paper industry.  I was working for the “Herald Examiner”, a company owned by William Randolph Hearst.  At 11 years old, I was a business partner with one of the wealthiest men in the world.

I had an afternoon route that covered 85 houses.  When I got home from school, my stack of newspapers and rubber bands were waiting for me and I would immediately start the process of folding them in thirds, putting a rubber band on them and putting them in the bag that would hang on the handlebars of my bike.  When I was finished, I would begin the ride and throw them onto the porch of each house.  In all, it took me about two hours.

I lived in the San Fernando Valley, north of Los Angeles and the weather was excellent all year.  However, afternoons (especially in the summer) it could get extremely warm.  My route finished near a local liquor store, so I decided — being a man of employment — that I would buy a soda each day when I finished my route.

One afternoon, about three weeks into owning my own business, my grandpa Joe sat and explained profit and loss to me.  It was my responsibility to pay for the papers at the end of the month.  I needed to collect the payment from my 85 clients and whatever was left over was my profit.  The Herald Examiner charged me $4.30 per month, per paper.  I was able to charge $4.75 per month.  I made $.45 a month per household.  If I had 85 houses on my route, then I made $38.35 per month.  I was motivated to add more clients (sales) and to make sure I collected every single house (accounts receivable).  I also realized that my $.55 soda (entertainment expense) was eating over 40% of my profit.

My paper route taught me profit/loss, sales, marketing, customer service, and many, many other business lessons that I carry with me even today.  I am sad that my children don’t have similar opportunities to learn life’s lessons.  Adults in cars now deliver newspapers.  Gardeners mow the lawns.  Cars are washed by mobile car wash vans.  Where are the opportunities for young children to learn how to run a business?  Why are we surprised that young adults have trouble balancing a checkbook, keeping a budget and end up buying cars and houses that they can’t afford?  They were not given the opportunity to develop good business sense at an early age.

If it were up to me, I would bring back the paper route and give young people the opportunity to learn how to run a business and become entrepreneurs.  What do you think?

Share

If you enjoyed this post, please subscribe to the RSS feed.

Advertisements

Responses

  1. I had a similar economic reckoning at about the same age. It was getting close to Christmas and I wanted money for gifts, so I sold greeting cards, small toys, etc. door-to-door. That was a great experience for what would later be a successful sales career! So, yes, how do we in this day and age find valuable lessons that our kids can take with them throughout life?

    • Tim,

      So, maybe there is a business here? Putting kids back to work. “Jobs4Kids” Hummm…. There is a whole workforce out there that is untapped, and we would be doing a good thing for society?

      – Kevin

  2. Kevin,

    I think that there are more ways for kids to start a business today then there ever was in the 80s, when I grew up.

    For example, if your story took place today… the four kids that you beat out for the paper route could:

    – Create an open source blogging platform
    – Start a myspace layout business
    – Create and sell an iPhone app
    – Start a T-shirt company on cafe press
    – Make and sell music
    – Make and sell web sites
    – Make and sell MMORPG characters
    – Become a YouTube celeb and sell advertising
    – Find things cheap locally and sell them on eBay

    The sky is the limit today, in my opinion.

    • Excellent perspective. Thanks for sharing. Maybe the jobs have changed, but opportunities are similar…

  3. There has been much written about the skills 21st Century lack to be good employees. Much of it relates back learning to take responsibility and working with others. In our neighborhood, you can’t get the kids to shovel your driveway or mow your lawn. They don’t like to work and they don’t even help their parents!

    • I did the “paper route”, it was also my introduction to owning and running a business! As a 14 yo I learned customer service (some customers asked for the paper between the doors, not in the driveway). With this special treatment also came nice “tips” @ Christmas time. I may have categorized these customers as “pains in the ass” at the time, but they were the ones who appreciated it the most. But, I’m still big in customer service!
      Yes, grabbing a shovel the morning after a big snowstrom and doing driveways around the neighbohood for hours is a lost art………..

  4. I agree! I too was a young entrepreneur. I went house to house selling seeds. Vegetable and flower. I knew how many packages of those seeds I had to sell to get what I wanted. I raised my kids the same way. When I was 14 I got my working papers and my first job was at a jewelry store, where I learned about mark up and profit and loss. I also worked one summer where a block in our town had burned down and had to be completely cleaned up and a park was constructed. I brought my kids up the same way, but I too fear that young adults are not getting the knowledge they need to be successful. Responsibility at a young age breeds business success.

    Sherry Fischer
    Marketing Coordinator
    S & B Staffing

  5. I have been a board member at Youth Employment Service of the Harbor Area (helping youth prepare for an find jobs ages 14-22) for over five years. I have also worked in the career transition field with adults and youth for over three decades. In this time, I have observed young people find meaning in their lives and building self esteem through work related experiences. There is nothing more empowering or educational than a positive work experience for young individuals. Many of the kids who come to Youth Employment Service work to contribute to their family’s overhead… What they do is depended upon and important to their own survival. They learn the lessons of profit and loss at a very young age. As a parent and community leader I believe it is essential for adults to create opportunities for our children to learn how to “stand on their own legs” and empower themselves through work related experiences. One of my daughter’s first work experience was to assemble a group of neighborhood kids who offered a early morning coffee bar right on our street corner. They made their investment back, pocketed some money and created lots of smiles from the neighborhood. There’s never been a question in my mind that one way to adult independance is for my child to learn how to take care of herself through employment. It is up to me as a parent to not “do for” but to help her “do for herself”.

  6. The problem with today’s youth is everything is given to them. We are living, or were living in a very prosperous time. Parents feel they need to help their kids and give them everything they want to make them happy. Therefore for the child there is no need to work. They are lazy, spoiled brats who have no desire to succeed because mommy & daddy will give it to them.
    I watch neighbors, clean out their garage, wash their cars, do all the yard work, while the whole time junior is inside playing X-box.
    I have 3 children. My oldest is in college. My friends think I am insane for making my children pay for their own car & their own hobbies. My parents did the same to me and probably most of you who are reading this as well. My oldest is home from college and is working 2 jobs plus selling bike parts on E-Bay. My middle son at 16 has set himself up with 10 families who use him for baby sitting, several of these families pay him $10 an hour, and has a lawn mowing business.
    I agree we need to teach our children to be more entrepreneurial, but more importantly they need to learn a work ethic. What my Dad taught me is “Do a job right or don’t do the job at all.
    They need to be observant and see a need and figure out how to fill it.

  7. I have to say, to Chris Hall that I was with you on your first comment, I’m not entirely with you on your second one. Every generation thinks they were the hard workers and the next are all lazy bums. It’s been that way since Socrates. They’ll turn out just fine. Right now the youth of today are entering a recession not of their making and will inherit the largest debt in the history of the world, also not of their making. I hardly think the generation that’s “running things” now is in a position to judge.

  8. I think the Opportunity is still there……for example your young businessman can “cut,blow and go” lawns and “undercut” the Pros out there ….On my street the rate is $60-80/mo. I am sure a budding entrepreneur could make a go of it for $40…..thing is nobody has ever asked me….if I want a youngster to say look after my dog I have to find them….and I typically pay $8-$10/day. I think the lack of entrepreneurial spirit comes from their parents.

  9. What is $38 a month in today’s dollars? Apart from parents worrying about the safety of paperboys, and the general culture against small jobs like that one, I bet the economics don’t support it any more. Love the idea, though.

  10. I am getting a little tired of reading all the experts and their comments about the economy. Especially the collapse of Europe. I have trouble with all of the sophisticated terminology. And the Blabbering on and on about GDP’s And Global Markets, and IMF’s. I learned all of that “Stuff” on my 26 inch Schwinn bike with the bent front wheel. The front wheel was bent because one of the jerky neighborhood kids got hit by a car. I bought the bike from him for $5.00 and spent the next summer or two trying to straighten out the wheel. As soon as I learned to keep the bike going straight and keeping it on the sidewalk I got a paper route. From that point on economics was very simple. You picked up your papers from the “Manager” and you folded them and stuck thin in a canvas bag that hung on the handle bars. You flung one of the papers on to the porch, hopefully, of each house that you had as a customer. And they were clearly marked in the little book you carried. The name and the address and a box marked paid for each of the previous weeks. That was it…. The supply and the marketing all learned in about fifteen minutes.
    The money management took a little longer to learn. That probably started in the high chair when your mother said finish your peas…. We don’t get them for nothing at the A&P….. And then when she said
    “A penny saved is a penny earned” and “Save for a rainy day” and “Don’t throw out the dirty water until you have clean water” and my favorite “Waste not want not”….
    My Economics education and my business skills were all learned by the time I was twelve. If you don’t work you should not get paid. The boss is always right, even when the customer is wrong…… which isn’t very often. And if you make $5.00 a week you can’t spend $6.00.
    And any organization that holds a gun to the head of the boss and demands more money for less work is not a real good idea. If you are not happy with your job or your pay scale go to night school or change jobs.
    If I were the king of Greece or the President or the prime Minister or whatever the job title of the guy that screwed up their economy ….. The guy that bought all of the votes with somebody else’s money…. I wouldn’t be trying to borrow money I would be sticking my head in the oven and hoping I paid the gas bill……………

  11. i loved this post so much. kevin………you say you learned at a young age… im learning it at 37 years old but im inspired by you thank you

  12. Byron,

    Thanks for the comment. Glad you enjoyed the post.

    – Kevin


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Categories

%d bloggers like this: