by Anika Dewjee
In 2021, only 1% of entrepreneurs were Gen Z, aged 6-24 (Guidant Financial). Starting your own business, especially as a teen, can seem like a daunting task. According to Junior Achievement USA, “69% of teens say they have a business idea but are unsure of how to start the process”.
The first step to creating a successful business is
to identify a problem. This can be a problem in your house, school, work, or community. The solution to this problem will be the product or service that your business will offer.
Next, research your competition to determine what is already on the market, and how to make your product better. Some types of competitive advantages include product differentiation, cost, or niche marketing.
The most important step is to identify your target market: a group of similar consumers at which the product or service is aimed. Some factors to consider are demographics (age, gender, education, etc.) and psychographics (behavior, personality, etc.), plus the total size of the market, and current trends.
The most challenging step in creating a business is finances, which includes calculating the cost of goods or services, selling price, and profit made. It is very important to make sure that your business is never spending more than it is making. According to Steven Li, an 18-year-old entrepreneur who published his book “Succeeding in the College Application Journey”, you must “be scrappy and harness your individual social network” in order to bring your business to life.
Once you have identified customers, you will reach them through marketing. Isabella Dymalovski, the founder and CEO of Luv Your Skin (a skincare brand for teens), advises that as a teen entrepreneur, you should “always put yourself out there, especially in the early stages, to convince people to buy your product”. After branding and pricing your product, advertise your business to reach your target specific market through social media, posters, mailers, emails, etc.
The process of creating a business is complex, but also very exciting, and these five steps outline a framework that can be beneficial to teens who have a business idea that they want to pursue.