>> Production funding and educational outreach for Biz Kids is provided by a coalition of America's credit unions, where people are worth more than money.

A complete list of individual credit union funders is available at wxxi.org.

>> Every day, America's credit unions help members with their financial needs and with programs like Invest in America.

It's only fitting that credit unions support Biz Kids because financial education is what we do.

Learn more at lovemycreditunion.org.

>> Oh, no, doctor.

What do we do?

>> Okay, stay focused, nurse.

You have to watch the charts.

>> This business is in trouble.

I don't know how much longer it can hold out.

Oh, it's too late.

It's hemorrhaging cash!

>> Everybody just stay calm.

There's still time.

Apply pressure now.

We have to cut our expenses.

Scalpel!

Start the transfer of cash!

>> I don't know.

There's not much left.

>> We've got to get the income above the expenses.

Clamp!

This is not working.

>> What do we do now, doctor?

>> I'm in way over my head.

We need a specialist.

We need a Biz Kid!

>> ♪ When making money is the aim ♪ These kids they bring their game ♪ They're the Biz Kids Can you dig it?

♪ They know what's up and let you know ♪ Just how to make that dough ♪ They're the Biz Kids Right on ♪ So learn a little more about bringing money through the door ♪ They're the Biz Kids Right on.

♪ >> You may think your success is measured by how much money you have coming in, like this.

But everybody also has expenses, or money going out, like that, on things you need or want.

All this comes together to form your cash flow.

It's the same with big businesses as it is with you.

>> See, the key to it all is finding the balance between your income and expenses.

Over time, if your expenses are greater than your income, you've got negative cash flow, which can cause some problems.

Now, it looks like you need to increase your income.

>> We need more cash!

>> Or reduce my expenses.

>> Exactly.

Now, if your income is greater than your expenses, then you've got positive cash flow, which is great for financial success.

Now you're getting it.

There you go.

>> Hi, my name's Alex.

>> Hi, Alex.

>> I'm a branch manager at StudentPainters.net.

We're here to paint our way to profit.

StudentPainters.net is a student-based company.

Hire students like myself to manage a crew of employees.

Last summer, the average manager earned about 22% profit on their revenue.

I earned nearly 38% profit because I kept my costs very low, which increased my profit margin.

Me and my painters will go cold calling, knock on random home owners' doors, trying to collect some leads.

If they're not home, we'll go ahead and put a door hanger on their door.

Once they call us, we'll set up a time for me to come out, estimate the house, see how much it's going to st to get painted, and we go from there.

Time is money.

In order to save time, rather than use a tape measure, I pace off the sides of the house to estimate the square footage.

After I come up with a price after estimating the entire house, if it's pretty big price, I have to present it to them and sell it to them.

You got to be a nice guy.

You got to have some charm.

You got to be able to talk to people.

You have to know your stuff.

I go home; I keep track of my expenses.

I know exactly where every penny's going.

And by doing so, I can save money on my expenses and keep more profit for myself.

So in order to keep my startup costs low, I borrowed a truck from my mom, I bought used ladders and used equipment.

This ladder cost me $300.

This is an airlift sprayer.

It cost me $700.

And these guys are my painters.

I pay them $10 an hour.

But after insurance, taxes, and workman's compensation, it actually costs me $17 an hour, all of which comes out of my expenses.

>> Tape, it's a small expense, but it adds up.

>> So this gallon of paint cost me $25.

It covers about 350 square feet per gallon.

We're going to need six for the entire house.

So my total expense for paint is $150.

So in order to save money on paint, I would actually buy a little bit less than I needed, because it would actually cost a lot of money to throw it away.

If I needed the last gallon, I'd go ahead and go get that.

Cash flow is exactly that, the flow of cash through your business.

You need to have your income as high as you can and your expenses as low as you can.

Okay, Biz Kid, keep your expenses low, and soon enough you'll be rolling in the dough.

>> Expenses.

That's why they call me Capitalist Peg.

>> Hey, Peg!

>> Speaking of negative cash flow, what is it, boy genius?

>> I think I got this income and expenses thing all figured out.

>> Well, let's take a look.

>> Oh, no, my cash, it's flowing!

>> Oy vey, Bri... >> I don't know what cash flow is.

>> Cash flow, what I don't have.

( laughter ) >> Oh.

>> I do not know what cash flow is.

>> Flow of money in and out?

>> That sounds like something that has to do with accounting.

>> Bring it in, take it out.

>> The amount of money that flows.

>> The actual money you have in your pocket.

>> I think a cash flow is when you get a whole bunch of money.

>> Cash flow... >> Cash flow... >> Cash flow... >> Cash flow is the money coming in and the money flowing out, where it's going, where it's coming from.

>> Uh-huh.

>> How your income and expenses match up to each other is called your cash flow, and there are only two ways your cash flow can go.

If your income is more than your expenses, then you're making money, and you have a positive cash flow.

>> However, if your expenses are more than your income, then you're losing money, and you have a negative cash flow.

>> You have ultimate control over your cash flow by adjusting your expenses or your income.

Want to see how you're doing?

Try keeping track of every cent you make and every cent you spend for a month.

>> Yeah, I did that a couple months ago.

It was actually pretty scary.

But a few more hours a week at Pricey Pizza and a few less music downloads, and I turned that negative cash flow into a positive.

>> Not bad.

>> Yeah, yeah, I'm not hemorrhaging cash anymore.

I'm not bleeding red ink, if you will.

>> Hey, it sounds like you solved your cash-flow problem.

>> One way to hold down your expenses... >> Sorry.

>> What are you doing to me?

One way to hold down expenses is to cut labor costs.

>> But you don't want to cut them too much.

>> Why not?

>> Because it's illegal.

There is a thing called minimum wage, you know.

>> What if I told you about a kid who has his own factory and hundreds of workers, and he's paying them all less than minimum wage?

>> My name is Timothy.

I raise honeybees, and I'm 18 years old.

( coughing ) Whoa.

The honey is actually the bees' food.

They gather nectar and bring that back to the hive.

They turn the nectar into honey.

The beekeeper just takes the extra that the bees can do without, basically.

All right, let's go get them.

I currently have eight hives.

Each hive has about 60,000 bees.

So I have about roughly 480,000 employees.

And I don't even have to pay them minimum wage.

When I started beekeeping, I started as a hobby.

I had no intentions of starting it or going into a business.

It was something fun to do, something interesting that I thought would be great to try.

And then that first year, the bees did really well.

They produced a lot of honey.

I think over 100 pounds, I think, the first year.

You can actually see, inside, it's full of honey.

We can't eat 100 pounds ourselves.

I mean, we gave a lot away.

I thought, "Hey, this is a good opportunity to start a business."

That's kind of how I started Busy Bee Enterprises.

I received income through selling my honey-- basically honey revenue.

I sell one-pound honey jars.

I have two-and-a-half-pound jars.

I have a five-pound jar.

I even have a special cowboy bear.

My honey, it has all the natural enzymes and pollens still in it.

It's unpasteurized and unfiltered.

That's what actually makes it a great health food.

People started buying the honey, and then it kind of took off from there.

I thought, "What else can I do to kind of increase this business, just so I have that extra income?"

I started collecting beeswax from the hives and started making the lip balm, the furniture polish, candles, quite a few different little things.

I'm working toward all of this to increase my revenue and my sales.

Hey, Biz Kid, buy Busy Bee.

It's the best.

Here's a poster I put together when I won the Celebration for Young Entrepreneurs contest.

I won this trophy and $1,000.

I guess that would be income.

Income and expenses-- try to keep the income high and the expenses low.

My expenses are basically the money I put out to maintain the bees, bottles, things I've used to help further other products.

Right here on the computer, I keep track of my honey revenue and expenses.

Hey, it's been a pretty good year.

I've never had a year where I've had more expenses than my income.

My income's always been higher, which is really good.

I like to reinvest quite a bit back into the company, kind of expand it.

I love the bees.

I'll always be a beekeeper, at least on a small scale.

I think anyone could become a beekeeper if they wanted.

It takes a lot of hard work and a lot of determination, but I think anyone can do it.

Hey, Biz Kid, time to buzz off.

Got bee stuff to do.

>> Hey, Biz Kids, keep your income higher than your expenses!

>> The difference between income and expenses, there's the money coming in and the money flowing out.

>> What he said.

>> My expenses are definitely more than my income.

>> Here's my income for this week.

It's everything I've earned.

The return on my investments, the interest on my savings.

It's really pretty beautiful.

But the problem is I don't get all of it.

There's always expenses.

Like, even before I get my check, money is chipped away through taxes.

I had a phone bill due this week; there's some more.

I'm buying lunch, a big lunch.

I bought some new clothes.

Okay, okay, I bought some really nice new clothes.

See, I bought the new clothes because I'm throwing a party, and I'm kind of known for throwing a really cool party.

>> Hey, Kaelon, you're party is live, but we ran out of ice.

>> Oh, okay, there you go.

>> Thanks.

>> So remember, income is the money coming in; expenses is the money going out.

In the end, it's always fluid.

Just do your best to spend your income wisely.

Some ice in here.

Cheers!

There goes my budget.

>> Income and expenses.

Income, in it comes.

Expenses... exit?

Must budget.

( fingers snapping ) >> Hm.

The secret to cash flow is to have more income than expenses.

Think of these cows.

( cows mooing ) You want to have more black cows coming in than white cows leaving.

Let's watch.

( cows mooing ) >> I definitely think that my parents thought what I did was weird at the beginning, for sure.

( clocks chiming ) I think they also thought it was kind of a phase.

I know my mom said that a number of times.

( clocks ticking ) >> It's a phase!

>> I think they thought I was going to grow out of it.

Oh, they'll get me a few tools, I'll do a few wood projects and whatever, and that would be the end of it.

>> I know he'll grow out of it!

( clock chiming ) >> Little did they know their whole house would one day be taken over by woodworking equipment.

My name is Richard Foster, and I run Richard Foster Construction and Time For Sports.

Richard Foster, that's me.

>> Hi, Rich!

>> Three years ago is when I got into the clock business.

I made a tennis racquet clock by hand for my tennis coach, and people at the club started ordering them.

And then they said, "Oh, can you do golf?

Can you do baseball?"

So I just kind of started branching out from there.

And then once the order quantity got too large for me to handle by hand, I went and I started to look at mass production machinery.

Right now we're in my garage.

I'm standing right in front of a CNC-- computer numerical controlled machine-- which is the machine that cuts all the clocks.

I can now produce between about 12 and 30 clocks at once over the course of two hours, when each one used to take me about four to carve by hand.

Almost as good as me.

Revenue is about how much money I take in, and expenses are how much money I have to spend to take that money in.

The way I increase my revenue is basically by the marketing that I do.

Each year I sponsor a few different events on the ATP, WTA, and PGA tours, which are the professional tennis and golf events which you see on TV all the time.

So by doing that, I get my product out to between typically 100,000 and a quarter million people per one to two weeks.

When we talk about income and expenses, obviously we always want to increase the income and decrease the expenses.

I have expenses with regard to the clocks in terms of the motors, the wood, the hands, the paint, the labor.

From my prototype, what I then did was I evolved into a pine version of that clock, which is what I had originally been making them out of.

From there, I said, "I think the product can really be improved, and if I can improve the product, I'll be able to sell more and therefore increase my revenues."

This version utilized a fairly more expensive grip, the same numbers, but I really upgraded the finish on this model.

So what that finish did was it allowed me to sell more clocks, because when people picked it up in their hands, they said, "Wow, this is really a great product."

I picked out a grip that had dimples, which came at a lower cost than the other grip, but the great thing about it was was there it was a grip with dimples, and that could be used on a golf clock too.

So with one grip, I was able to do both a tennis clock and a golf clock.

So I virtually halved my expenses on the grip just like that.

Hey Biz Kids, just make sure your income always exceeds your expenses.

Today we're going to be making a football clock.

So on the computer, I've already pulled up the computer drawing of the clock that we're going to be cutting, and it's time to get to work.

>> It's a phase!

>> I really try not to look at myself as a kid.

I try and look at myself as a young entrepreneur.

When I first meet people, at times they might be slightly taken aback, so to speak, by "Oh, what's this 18-year-old who looks like he's probably 12 or 13 doing trying to sell me something or partner up with my company?"

But over time, I think they see the professionalism that myself and the other people who work with me carry and how my passion really leads to overall success of partnerships and things of that nature.

Now, if you'll excuse me, it's time for me to get back to work, and it's time for you to leave.

>> Jorge and brother now demonstrate cash flow.

Cash flow goes round and round, in and out.

It's called cash flow.

I'm getting a little dizzy here!

Income drives up profit.

Dizzy!

Expenses pushes profit down.

>> It's a balance of finance.

>> Oy oy oy, I'm getting...

I'm going to throws up!

>> Don't throw up.

>> Money, money, money, money, money, money, money, money.

>> I wanted a laptop for when I went back to school in the summer.

So I took up my traditional summer lawn-mowing job.

I needed $1,200 for the laptop of my dreams.

So I hit up all my regular customers, plus I got new ones through recommendations.

Now, you have to understand I was motivated, lots of lawns every week, just me and the lawn mower, no expenses.

So by the end of the first month, I had $500.

I was on track.

By the first week of July, I had $700.

And that's when things went wrong.

The lawn mower broke.

I don't know what it was, the tie rod, the belt, or whatever, it broke-- $400 worth of damages.

Plus, the lawnmower was out for two weeks.

So when I got it started again, lots of work to catch up on.

Hit my regular customers again, got new ones, and I did $800 worth of work that month.

Plus, I had $100 in savings.

So I'm there, right?

Wrong.

Some of my customers couldn't pay up because they had other bills.

And where does that leave me?

That leaves me with people owing me money, which is called accounts receivables.

So no laptop for me.

But don't worry.

I will get the laptop at some point.

And what I've learned about business is while profit is good, cash flow, that's king.

>> You like?

>> Oh, I see you've been shopping at Cave-Mart, the blue fire special.

You look fantastic.

>> Thank you.

I got this bracelet, this thing, my new bone, clean feet.

>> Too many expenses for our income!

>> I'll show you too many expen... >> Ow, ow, ow.

>> Hey, got any donuts?

>> Oh, yeah, in just a minute.

>> I have to say, yours are the best.

>> Well, it's an old family recipe.

The only problem is I know I can make good donuts, but I can only make a few at a time.

Oh, here you go.

>> Thanks.

>> Hey, where's my donut?

>> See, that's the problem.

I can't make enough income this way.

That's why I decided to up my expenses.

>> Your expenses?

>> Yeah.

I saved up my income so I could buy a bigger machine.

Now, it was a big expense, but it should really increase my income.

>> Hey, is that donut almost ready?

Whoa, is this your new donut machine?

>> Yeah.

Remember how I used to have to mix everything up?

Now I just pour it in here, and it does all the work for me.

Hey, could you turn it on?

See?

With increased volume, I've upped my income.

>> Lauren, next time you should spare some expenses on boxes.

>> Oh, my gosh, I forgot!

Try and turn it off!

Oh!

>> Lauren, I think there's a problem.

>> Hi, I'm Lucy Williams, and welcome to Kidz Kitchen.

I'm Lucy Williams, and I'm 15 years old, and I own Kidz Kitchen.

Kidz Kitchen is a summer camp that I created four summers ago.

I was always really interested in kids, and I was trying to place that with some of my interests, so I decided to do cooking, which has been a huge passion of mine.

I always loved to play restaurant when I was little and make dinner and go around, take people's orders, wear my apron.

The camp is not just mainly cooking.

It's arts and crafts, sports, and we do swimming at the end.

At the beginning of the camp, I have to put together a estimate on how much I think things are going to cost, so I can be prepared.

If they're relevant coupons, I try to use them, since I'm buying a lot of things in bulk.

Before the week starts, I lay out everything in plastic bins so that I know what's going on.

This is for the recipe for today.

It's called worms in dirt, and we have all of the ingredients, the gummy worms and the chocolate pudding and the cookies.

And we have our recipe so that we can read through it at the beginning.

A typical week is five days.

It's Monday through Friday, 9:00 to 12:30.

And the first thing we do is we come and cook.

Hey, guys, welcome to Kidz Kitchen.

Today we're going to be making worms in dirt.

How does that sound?

You got all your cookies and your worms.

Does that look good?

>> Yeah.

>> Yeah.

With income and expenses, it's definitely a challenge.

I've definitely learned lots of lessons.

I try to buy in bulk when I can at Costco.

And other times I just have to compare prices when they don't have it at Costco.

I also have a Web-site, which I have to keep up and running.

Per year, it's a certain amount of money, and I have to pay for that Web-site, so that also comes out from the income.

I have to pay for the printing of my brochures.

I have to make sure that I keep track of the postage and the printing costs of that.

After I've paid for all the arts and crafts and all the ingredients and keeping the Web site... Total expense is $338.

...I do end up with a profit, yes.

Keeping track of my income and expenses is definitely very important.

You need to have all your checks in one place so that you know, and you need to know who's paid you and who's not paid you.

This is the name of the camper and who the check was made out to.

One of the specific things I've learned is to keep track of my expenses with all my receipts so that I know how much I paid for them and who I owe for them.

I definitely always want to continue cooking and having it be a part of my life.

Right now I'm not so sure what I want to be when I grow up, but I think owning a restaurant or being a chef in a restaurant would be really cool.

>> Be a Biz Kid!

>> A biscuit?

>> You want to be financially successful, right?

>> Right!

>> Of course you do.

Everybody wants to be financially successful.

And what do you need for financial success?

Positive cash flow, my friends.

And you know what that is, right?

It's when your income is greater than your expenses.

Simple.

And you know how to get that, right?

That's right.

You increase your income; you reduce your expenses-- bring more money in, spend less money, or both.

You know how to do that?

>> Well, you can increase your income by working more hours or finding a higher-paying job.

And you can control your spending by sticking to a budget and carefully allocating your spending.

>> Yeah, that's right.

In a minute, all these guys will be Biz Kids.

>> I thought we already were.

>> And now it's time for a Biz Kids Biz Quiz!

Okay, guys, this is way too easy for them.

Any Biz Kid would know this stuff, seriously.

I'm so out of here.

>> Hi, I'm Chris, I own Rockin W Cattle Company, and I'm a Biz Kid.

Cattle ranching is real expensive.

You have your operational costs.

You just got to balance it out between your expenses and your income.

Budgeting really helps keep you costs down.

It really just helps you keep everything in order, and you know, you're as accurate as you can on your income and expenses.

Broke my shoulder riding a dirt- bike a few years back, so I sold the dirt-bike, and I bought a couple calves from a friend and raised them into cows and kept buying a couple more and borrowed some money from my dad.

Pretty quick, I had a company going.

The name of my company is Rockin W Cattle Company.

I chose that because my last name is Wilshire, and the brand looks nice.

We breed and raise cattle.

We bale hay, do grazing.

I fix fence for people.

I haul cows for people.

And I just like coming out to the ranch and seeing everything-- you know, seeing the grass grow, seeing the calves running and playing and going nuts kind of.

There's lots of risks in the cattle business-- mainly drought, cattle getting away, sicknesses.

I tend to get my boots shined and go out and step in a cow pie on accident, and then we got to go to a fancy dinner or a banquet or something, and I kind of smell like cow mess.

Apparently, people in the city don't like that smell.

I like taking cattle to the sale and seeing people buy them and be happy with the product and making a profit.

Cattle ranching is real expensive: trucks, trailers, tractors.

When it doesn't rain a lot, you got to feed a lot of feed.

A well-fed cow is a happy cow.

I have to lease properties, and we pay about $10 to $12 an acre to lease ranches.

You got your veterinary costs, your medicines.

You just got to balance it out between your expenses and your income.

She didn't even feel it.

Dinner time at Rockin W. To get loans, I go to the local bank, and I give them my business plan and just tell them what I do and how I'm going to make money and how I can pay them back.

And I have every little expense in there, and it's very accurate.

They're usually pretty cooperative with a young entrepreneur.

Texas Christian University has an entrepreneurship award, and I was one of the lucky five to get a scholarship to go there.

Managing time is pretty tough.

Going to college full time, doing that and cattle ranching is real hard to do.

It is part of being a Biz Kid-- time management skills.

I don't know.

Hopefully, by the time I graduate, I ought to have enough cattle and enough hay crop to support myself and, you know, a family or whatever.

I like ranching.

I ain't going to lie to you, this is fun.

I think it's good for you, getting up early, working, having fun.

It's heritage, always been around, always liked it, and I want to do it for a living.

>> Uh-oh!

Maxwell.

>> Yes, sir.

>> I need you to deliver this month's budget report to Mr. McKenna right away.

>> Okay, but... >> According to my figures, we've got more money going out than coming in.

>> Yes.

>> That's not good!

>> No, sir.

>> So I want you to come here into my office... >> Yes, sir.

>> ...and pick up this report.

>> Right.

>> And deliver it to McKenna immediately.

>> Okay, but wouldn't it be easier for you to just hand the report to him, sir?

>> Well, I guess I could try that.

Here's the budget report, McKenna.

>> Hm?

Thank you.

Hm, looks like we have more money going out than coming in.

That's no good.

>> Yes, I thought you'd agree.

>> Income-- keep on top of the cash flow, more money coming in than going out.

Keep track of your money, and remember, the pennies can add up.

Uh, wait a second.

Uh-oh.

I guess I didn't keep track of my expenses.

This is what you call negative cash flow.

>> A tip for trimming expenses would probably be to not have three ( car horn honking ) a day.

>> Save it, because I don't save my money.

>> I think that it'd be a good idea-- is to cut down things that you just don't need.

>> Cut back on eating out.

( laughter ) >> Save it.

>> Don't eat out as much.

>> Work more.

>> Work more.

>> Don't be stupid with your money.

>> Exactly.

>> Just being aware of the money you're spending and, like, keeping track of it.

>> If I saved all the money from when I was 12, I'd have a lot.

>> I'd be loaded.

>> Yes.

>> Money comes into a business when they sell their product or service.

That's called their income.

Now, businesses also have to worry about their expenses.

And I think a question needs to be brought up about this show-- like, is this show doing enough to control its expenses?

I mean, look at this shot.

Like, look at all the people in the background.

You guys can go.

I can do this scene by myself.

You guys could leave.

There we go.

Oh, oh, and audio on this show, I mean, look at this guy.

So he stands there and holds the microphone, but, I mean, I could hold it.

There we are.

Oh, oh, and the camera operator-- so you stand there, and you zoom in and out, but the camera is on a tripod.

So do you really need to be there?

Seriously.

You could just lock it and walk away.

I mean... okay, well there we go.

( microphone feeding back ) Now, where was I?

Oh, and the lighting.

I mean, if we just turned off a couple lights, we would save so much on electricity.

Could we just turn off a couple?

There we go.

Now, so I was talking about... okay, well... um, okay, well... Could we... could we turn a couple back?

Just maybe one?

Okay, well, that's enough, I guess.

Um... okay, I'm kind of afraid of the dark.

Can we... no?

Okay, well, I guess I'll just leave.

( clanking ) Oh!

Oh!

Ow.

I'm okay.

I'm okay.

( cat screeching ) Everybody wants to be financially successful and... ( mumbling ) You reduce your expenses... No, no, I'm sorry.

Line?

>> Increase your income.

( laughter ) >> I got it, I got it, I got it, I got it, I got it.

>> Rolling, from the top.

Quiet, and action!

>> Wait!

No, I don't.

What's the first word?

I'm sorry, I had it!

>> Positive cash flow!

>> Positive cash flow.

Okay, okay, let's go, okay.

( laughter ) Positive cash flow, my friends.

And you know what that is, right?

That's when your income is greater than your expen... was that... did I screw that up, Mike?

I think I screwed that one up.

How long do I... it's positive cash flow, my... yeah, okay, I screwed that up.

>> All right, so now you've heard some of our stories, and we want to here some of yours.

>> Maybe you or a friend have started your own business or thought of some ideas to help the community.

>> Yeah, we want to hear about those.

So go to bizkids.com and share the good news.

>> Who knows?

Maybe you'll end up right here on the show.

>> Well, not exactly right here, but yeah, on the show.

>> How about right here?

>> Mm, no, not really.

>> How about right here?

>> No, not there.

>> How about right here?

>> Production funding and educational outreach for Biz Kids is provided by a coalition of America's credit unions, where people are worth more than money.

A complete list of individual credit union funders is available at wxxi.org.

>> Every day, America's credit unions help members with their financial needs and with programs like Invest in America.

It's only fitting that credit unions support Biz Kids because financial education is what we do.

Learn more at lovemycreditunion.org.

Captioned by Media Access Group at WGBH access.wgbh.org