- Demographics: Which social groups would be most interested in buying your product?
- Psychographics: Does your product appeal to a certain personality type?
- Lifestyle: Would your product sell best to people with certain skills or interests?
- Geographic location: To what region or locality would your product be most useful? Realistically, you will start by selling to your local community, so keep in mind what your local community needs when designing your product.
- 7 Strategies to Ace Your Summer Classes - April 12, 2018
- Breaking Down the College Admissions Process: Your 5-Part Guide - April 12, 2018
- The Ultimate Summer Checklist for High School Students - April 11, 2018
A Beginner’s Guide to Starting Your Own Business In High School
Why start a business?
“Entrepreneurship” is a common buzzword in the college application process. An entrepreneur is essentially someone who creates a new business. In the context of college admissions, however, the word entrepreneur is synonymous with a successful and motivated applicant.
Admissions committees tend to see students who run a successful business in high school as more experienced. Thus, if you want to gain an advantage in the college admissions process and you have an innovative idea for a product, you should consider becoming an entrepreneur.
After all, starting and running your own business is an impressive task. Many entrepreneurs don’t start their businesses until their late 20s or after and have at least a bachelor’s degree. That doesn’t mean that only older, more experienced people can start a business though. Even high school students can come up with innovative ideas.
Also, starting your own business as a high school student provides you with unique advantages for the future. It shows colleges and future employers that you are responsible, creative, and have a passion for whatever your business provides. This is especially useful if you want to be a business major, but it can be helpful for many other fields as well, particularly if your business is in the field of study that you want to pursue. For instance, a prospective computer science major may consider building his/her own mobile phone app in order to demonstrate competencies in coding and software development.
Scholarship and financial aid organizations in the United States also value entrepreneurship at a young age. If you start your own business as a high school student, you may be eligible for various scholarships and awards that your peers aren’t. Some examples of these scholarships are the NASE Future Entrepreneur Scholarship, the McKelvey Foundation Scholarship, and the NFIB Young Entrepreneur Foundation Scholarship. For more information on finding scholarships, check out our Helpful Scholarship Resources and Tips.
Assessing your skills: What business should you start?
Businesses provide either a good or a service to their customers in exchange for payment. When starting your business, you can choose to deliver any product. If you’re stumped, it’s easiest to think about what your skills are and go from there. For instance, if you frequently babysit a younger sibling, you might consider starting a babysitting service. If you are really adept at knitting, you could sell hand-knitted goods.
If you want to structure your business around a product, think about some unique things you can create cheaply and easily. This may be a handmade or artisanal good, an easy-to-make household gadget, or even something as complicated as your own scientific device. Whatever you choose, you should earn profit as long as your costs are relatively low and you’re selling to the right market.
If you’d prefer to deliver a service, consider what you already know how to do. It could be something simple like babysitting or mowing lawns, or, if you have the appropriate skills and knowledge, something more technical like musical performance or teaching and consulting. Ultimately, you should create a business that is relatively inexpensive and distributes a product you are comfortable producing and selling.
Choosing the right market for your product requires some thought and research. When deciding what market you want to target, think about to whom you might sell your product and who would be the most willing and able to buy your product.
Some categories to consider when choosing your target market are:
Challenges and Questions to Keep in Mind
As a high school student, you won’t have as many resources available to you as someone older might. This means you’ll have to get creative to find a way to cover the initial funding for the startup costs of your business. Eventually, successful businesses fund their enterprise through their business’s revenue, but getting that initial product on the market requires an initial investment from the business partners. It’s up to you to find sponsors, investors, or other forms of financial assistance to get your business started.
You also need to think carefully about what price to charge for your good or service. If the price is too low, you may not receive enough of a return. If the price is too high, people will not want to buy your product. You need to find a balance between earning a profit and charging a price that customers are willing to pay.
In addition, you need to identify who your competitors are. Depending on what your business is, there may be many competitors or few competitors, and they could be large or small. For instance, if you’re trying to start a babysitting service, you may be competing with some of the neighbor’s kids or a large corporate website like nanny.com. Therefore, you need to find a way to differentiate yourself from them. What is it about your babysitting service that makes it better or more unique than the others? Will you provide a service that they won’t? Are your prices lower? You can use these benefits to appeal to and persuade your customers to do business with you over your competitors.
You will also have to market your business and get the word out about your product. After all, nobody will want to buy your product if they do not know it exists. When coming up with a marketing plan, start small and then go big. Start by talking to family, friends, and neighbors and asking them to spread the word about your business. Once you’ve gotten some customers and have proven that your business has appeal, expand your marketing outreach. Some ways to do that include online ads, placing an ad in a local newspaper, or reaching out through social media.
Finally, before you begin researching how to start your own business, you should consider your schedule and whether you have the time to commit to this. Odds are, you are a busy high school student who is already engaged in extracurricular activities and hobbies in addition to the eight hours you spend at school. That’s a large chunk of your day. Starting and running your own business can require a significant time commitment, too. Before you commit to anything, think seriously about whether you can put in the necessary time and effort that it takes to make a business successful. We at CV have some tips for how to effectively balance your time in high school to get you started.
Legal and Tax Issues
This is where running a business as a high school student can get very complicated, and unfortunately there is no clear solution. While teenagers are not exempt from paying business taxes or following the laws regarding business practices, they are not eligible to legally incorporate a business, sign a contract, or get a loan or credit card to pay the business expenses. Essentially, you are required to run a business like an adult but without any of the legal jurisdiction to do so.
Therefore, you need to have at least one adult to help you get these legal and tax issues taken care of. This can be a parent, neighbor, mentor, etc. He or she just needs to be able to act as a willing adult partner in your business and know the ins and outs of these complicated tax and legal procedures.
In addition, you’ll need to have an accountant or a local attorney you can consult. Business taxes, especially the self-employment tax, are complicated and depend on various factors including how much money your business makes. An accountant can help you sift through these tax requirements and make sure you’re managing your money correctly and efficiently.
As a high school student, you will be subject to some age-related limitations like child-labor laws and laws concerning products that have age restrictions like alcohol. There are also various laws regarding copyright, trademark, and zoning with which you need to comply. You need to make sure you are conducting your business in accordance with these laws. It’s best to consult a lawyer who specializes in businesses to ensure that your business will not create legal troubles for you in the future.
Finally, remember to keep adequate records of your actions regarding the business and any money that is flowing in or out of the enterprise. This information is crucial for you, your attorney, and your accountant. Without it, they can’t tell whether you’re running your business effectively and following all business laws and won’t be able to help you. Plus, if your business does run into legal trouble down the line, these records will be very important.
Final Tips for Young Entrepreneurs
With all of this in mind, you should be well on your way to starting your own business. Be sure to conduct some thorough research.. There are numerous other blogs, articles, and other resources to help young people come up with ideas and work through the kinks of starting businesses. Some of them may be may be tailored more towards college students, but the information could be applicable to high school students as well.
When researching how to start your business, the most important thing is to look for people who can help you. Take advantage of your network of family and friends through your school, extracurriculars, and communities. You’d be amazed at how knowledgeable some adults are about entrepreneurship and how willing they will be to help you succeed. These people can serve as mentors to you and be invaluable to the success of your business. However, these people won’t come to you; you need to actively seek them out.
Most importantly, don’t forget to mention your entrepreneurial status on your college resume! Many admissions committees actively seek students with entrepreneurial experience, so mentioning your business is critical.
For more information on how creativity and leadership skills can help you in the admissions process, check out these CollegeVine Posts: