Imagine walking into a busy bakery that's filled with the sweet smell of cinnamon rolls baking. Behind the counter, you can see the owner frosting a cake while a cashier takes orders at the cash register. Of course, this business, like all businesses, uses math: You can see the cashier taking people's money and handing them change, which requires them to be able to count out coins and bills. But there's a lot of math you don't see, too. The owner of the bakery had to measure out the ingredients for the frosting and for the cinnamon roll dough that's in the oven. They also had to buy those ingredients and decide how much they should charge for each item they sell. They'll have to pay the cashier, too, which can include a lot of complicated math. Math is the hidden ingredient that helps all businesses thrive, and it's not always about just numbers on a page: It's also about being able to make smart decisions and solve problems. There are tons of different examples of how businesses use math all the time to help them be successful.
Managing Inventory for Sale
Lots of kids set up lemonade stands in their yards to make a little extra money. When you set up a lemonade stand, you have expenses, like the cost of the lemons, sugar, and cups you need to make lemonade to sell. But how much of those things should you buy? You'll need to figure out how many cups of lemonade you should make. If you don't make enough lemonade, you'll lose out on money you could have made and have to turn people away from your stand. If you make too much, you'll end up wasting money on lemonade you couldn't sell. But if you set up your stand on a few different days, you'll be able to keep track of how much you sell each day and start getting a better idea of how many cups of lemonade you should make.
What you're doing here is managing inventory, and it's something business owners do all the time. They need to use math to keep track of how many of each product they have and how many they're selling. Then, they can order less of the things that don't sell as well and order more of popular products so they don't run out.
Pricing Products and Services
You could also make money by making jewelry and selling it. Maybe you've gotten good at making really pretty beaded bracelets, and now you want to try selling some. That sounds like a great idea, but how much will you charge? You don't want to charge too much, or else nobody will buy your bracelets. But you have to charge enough to make money. That means that you'll need to figure out how much the materials for each bracelet cost. Then, think about how much time it took you to make them; your time is worth something, too.
Businesses have to set prices on the products and services they sell every day. For instance, the owner of a bakery has to add up how much they spent on the ingredients for cinnamon rolls, then add a bit more to help cover the costs of things like the cashier's pay and the power bill to keep the lights on and the oven running at the bakery. Once they know how much a cinnamon roll actually costs them to make, they can add onto that amount so that they make a profit. If each roll costs them $4 to make, they might set the price at $5 or $6.
Making Sure Deliveries Get Where They Need to Go
Lots of kids sell cookies or candy door-to-door to raise money for their Girl Scout troop, sports team, or school club. When it's time to deliver those orders, how will you do it? You don't want to spend all day zigzagging all over the neighborhood, and if it's hot out, your products will melt if you stay out too long. You'll need to think about the distance you need to cover and figure out the best route to take, and you'll have to count out the right amount of each product to bring with you. You might even bring probability into your calculations: How likely is it that people will be home when you want to make your deliveries?
Adults call this "logistics." Logistics is the process of figuring out how to get the right things to the right places at the right time. Delivery services get paid to do this: They have to figure out the best route to take to deliver packages to people's homes so that they deliver as many packages as possible in a day. They work really hard to make sure that they waste as little time and gas as possible. In fact, did you know that UPS plans their routes so that their trucks very rarely make left turns? When a car or truck makes a left turn, the driver has to wait for the oncoming traffic to be clear before they can turn, which slows them down. It's only a few moments, but over the course of a whole day, with thousands of trucks making deliveries every day, it can really add up!
Math is everywhere in the world of business, even if you don't always see it. That's why it's important to pay attention in math class, especially if you're thinking of running your own business someday. The next time you see a successful business, remember that math is the secret tool that helps it thrive.
Additional Resources
- Dollar a Glass Lemonade Stand Game
- Pricing My Crafts: How Much Should I Charge?
- How to Start a Successful Lemonade Stand
- Product Pricing: Figuring Out What to Charge
- 11 Top Tips for the Best Lemonade Stand
- Five Common Pricing Strategies
- Jay Starts a Business
- What Is Logistics?
- Ice Cream Truck Game
- Change Maker Game
- 101 Business Ideas for Kids
- Form Your Own Business
- Why UPS Trucks Almost Never Turn Left
- Why Is Math Important in Your Life?
- Math Matters in Everyday Life
- How to Price Your Products to Turn a Profit
- Approaches to Pricing a Product
- A Simple Formula for Pricing Products
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