Transcripts For CNBC The Profit 20171229

This is the profit, my top 10 rules for success. My name is Marcus Lemonis and i risk my own money to save struggling businesses. Lemonis were not going to wake up every morning wondering if we have a job, were going to wake up every morning wondering how many jobs we have to do. Its not always pretty. Everythings going to change. Everything. But i do it to save jobs and i do it to make money. This. Lets go to work. Is the profit. You know, ive been traveling this country and investing in Small Business for for more than four years now. And ive met hundreds of entrepreneurs, their employees, their families. And what im reminded of time and time again, is that everyone has a story. Theyre complex, they have their own passion, their own motivation, and their own reasons for doing what they do. Its something i always try to appreciate. But all that being said, ive met some real jerks, a lot of them. And so, my first rule when it comes to success in business, dont be an ass. Thats really the number 1 takeaway, how to treat people. And ive met some people that just dont know how to treat people. Like that meal service guy in florida, erik at fuel foods. And im not going to youre going back on your deal . Im not going to when we discovered that he was connected to somebody that was in a ponzi scheme and that he was not really acting above board. Youre going back on your handshake deal . Youre going back on your handshake deal . It was the one time, out of the 60plus episodes where i actually thought somebody was going to hit me. Why would i shake your hand when it Means Nothing . Erik, good luck to you. Your handshake Means Nothing. We made a handshake deal. Listen, youre an intimidating guy. Youre not going to intimidate me. Im not trying to that was a big dude and there was just two cameramen and me. I literally thought i was going to go through the wall. Im going to walk out on you. Goodbye, erik. And then theres Andrew Rosenthal. [ laughs ] andrew owns la dogworks, this pet care place in l. A. That has everything from boarding, grooming, training, and a bunch of other things. I love the Business Model and i love anything to do with pets. But andrew, he was a complete maniac and he hated everyone. The only reason my partner is alive is because murder is illegal. Hes going to get fired anyway. Lemonis whys that . Because i [bleep] cant stand him. In the first day of filming, people typically are on their best behavior, but the really crazy ones, i think they have zero awareness. I remember Andrew Rosenthal being very aggressive, but then five minutes of being there, he was aggressive with me. I can make this businesses work with or without you . And his employees. No. Im not going to put up with that jesse failed miserably he wouldnt listen to a [bleep] thing i say i dont have to ask him time and time and time and time again email me the [bleep] schedule just do it thats a waste of [bleep] anger and yelling and screaming dont make anybody want to come to work early and stay late. And the goal is to get people to want to be attached to the business, not to run as fast as you can away from it. That brings us to the second rule, make your employees number one. Ive been publicly criticized about this philosophy. You read all these books that say, the customers always right and make customers number one. And at the end of the day, for me, the customer isnt number one. The employees number one. My theory is is that if you treat the employee right, that ultimately that employees going to be the one to interact with the customer and their experience will be better. I think the second thing is employees like to know you have their back. That guy erik you just saw, the one i thought was going to crush me, put me through the wall, he was even worse to his employees. What are you doing . come on and he bulldozed anyone who tried to question him. I dont really feel today that you guys feel like youre in a safe and secure environment to give your opinion without recourse. Woman because its always everybody elses fault. The way he says things, it does bother a lot of people that work here. Erik sorry if you feel like you cant approach me. Im sorry if you feel ive dominated you at a time. Im sorry if ive ever made you feel bad. You know, im im sorry. Just take it down a notch. But instead of changing his ways, guess what he did . He cut the pay of some of his top employees and even blocked them from the Company Computer system. And i think it was punishment for speaking out against him at that meeting. It smells like retaliation to me. You cut alex, you cut diana. Not at all. I think it is retaliation. Not at all. I work endless hours for you. You took us off the system. You already blocked us from all the passwords. I dont know what intentions youre doing. You locked her out of the computer already . I changed i changed my passwords, i cant erik. Absolutely. Not surprisingly, the employees that worked there, well, they left, they got fed up. They didnt want to deal with his crap anymore. Thats why i always tell people, encourage your employees, incentivize them, make them more attached to the business, not less. I remember tami from key west key lime. She singlehandedly kept that business afloat, managing their finances, inventory, the staffing, all for 300 bucks a week. And she had two kids at home and another one on the way. It was crazy. And the owner, he just took her for granted. How do you get it all done . I dont. Have you talked to jim about this . Yes. But he believes that everybody should work really hard and so its its disheartening. Its hard. We almost lost tami to another company, but we saw her value and we wanted to make sure that she stuck around, so we gave her a raise and paid maternity leave. Lemonis im going to give you six months worth of pay and im going to pay you 1,000 a week, so you dont have to bartend, if thats okay. [ sobs ] okay. Im going to give you a check and it should help you just kind of, just be able to rest, take care of your baby. And then when you come back, youre going to bust somebodys ass. [ laughs ] all right . Okay . Wow. Thank you. Every time i see that, it reminds me how important people are in business. And it isnt just about the numbers, its really about making sure that the people that work there feel like theyre taken care of. But whats also important to remember is that you have to hire the right employees to begin with and you have to know how to tap into their strengths. Which brings us to rule number 3, know what you dont know. Its very simple. I know what im good at and i know what im not good at. And what im not good at, i go find people that are really good at it and i make em part of the team. Not all of us possess skills to do everything. And when we cant recognize it, youre going to end up with a big pile of poo. Your take Something Like sjc drums. They make a drum, beautifully handcrafted, great staff, but the place was in total chaos. So youre inefficient and youre priced below market. Right. Which means you have high cost and no margin. Death spiral. The owner mike is secondtonone when it comes to marketing and hustling. But he doesnt know how to make drums and hes not the greatest with numbers, either. When i met him, he had essentially frozen out the two people who could help him most in those areas. There was his best friend chris, a guy as sharp as they come, but mike was ignoring his advice. Our Gross Margins last year were about 20 . What should the margins be . Chris . In my mind, they need to be like, 40 . In the pricing model that you put together, if mike wouldve stayed away from it, would it have been 40 . Yes. Lemonis even worse, there was his brother scott. The real drum expert in the family, mike had essentially forced him out of the business shortly before i arrived. You were the artist. Lets just call it like it is. Yeah, i mean, mike mike designed drums and stuff, but when it came to, you know, putting your hands on it an doing it, that was all me. I, in my career, have made thousands, like, i think 5,000 drums. So whats the story . Whyd you leave . What happened . Well, my brother formed a mutiny, is what i say. So there they were, two people who couldve helped mike run that business thousands of times better than he could have if he only listened to them. So i made sure he did and made chris a full partner. And then, as painful as it was, we got mike and scott talking again. People had the wrong idea about me because of you. And thats like, thats thats terrible. I apologize for that, scott. It things get blown up, things blew up. I never intentionally you did intentionally, turn i apologize for that, okay. No, you just said you didnt, but you did. Say you did. I did it. And im sorry for that. I just want some sort of relationship and not to be [bleep] awkward. I never wanted it to be this way, either. Lemonis and then watching scott work his magic, it was something special. I have ideas about that. I think you go one flat finish, but its a natural satin stain, cause then youre eliminating the cost of the laminate, youre eliminating an extra step when youre doing the bearing edges. I think naturals the way to go. Whats the size of the bass drum going to be . Its a 20inch bass drum. 20 inch . Yeah. If you offer a 20 inch and a 22 inch, you have almost the same shipping cost, cause youre still getting one box, but they were able to get another shell in there. Its kind of cool to listen to your brother, cause hes got some crazy [bleep] in his head and hes very smart. Watching and listening to scott is is like watching a savant make drums. The guys so smart and what hes able to do is really provide mike with insight that he couldnt necessarily have on his own. By the way, heres a news flash. Sjc is a multimillion Dollar Company today. Its going to make 400,000 or 500,000 in profit this year. We just received a giant, additional investment from a vendor. That isnt because they made a better drum, its cause i think mike was able to take a step back and recognize that other people were better at certain things than he was. Things get personal. You want to start airing the dirt, nancy . I dont give a [bleep] my rules for success when family and business make for an explosive mix. But when we brought our daughter home, that was it. Now i have nicoderm cq. The nicoderm cq patch with unique extended release Technology Helps prevent your urge to smoke all day. Its the best thing that ever happened to me. Every great why needs a great how. There are some issues that have come up time and time again. It, and one of those is family drama always getting in the way of business. Youre coming off like youre saying [bleep] to your daughter. Go to hell. You and your dad have blow ups here . All the time. Back up. Youre crossing the line between father and boss. How about you marry some crazy [bleep] that we dont like and that something happens to you and then have to deal with her . Its not that i go out and i look for Family Businesses that have conflict, families generally have conflict. Businesses generally have conflict. That tension and that energy is something that ive often tried to remove myself from, at least in the early years, i did, cause i was like, im not oprah. But at the end of the day, i kind of am oprah. I do have to be involved. It sounds like youre more hurt that your brother was kicked out. I mean, i feel like i i literally got an mba in therapy. And ill tell ya, the main lesson ive learned is, if youre going to work with family or close friends, youve got to accept the crazy. Dysfunction in family and dysfunction in business can actually be managed by just recognizing what it is and working around it. Its understanding strengths and weaknesses and hot buttons. Now there are those who end up understanding that and there are those who dont. A perfect example of the latter, worldwide trailers, a concession truck builder out of waycross, georgia, and probably the craziest, most dysfunctional organization ive ever been involved with. Owners tom and nancy ended their 20year romantic relationship, but they continued to work together. What ensued was complete chaos, screaming, yelling, and way too much information. Just so we all know you put us in this situation. Toms girlfriend has been working has been working in this company for three [bleep] years oh, my god, i remember this. It was so hot in that trailer and they were screaming at each other like crazy people. I have so much proof right here that shes been working in this company. It is un[bleep] real this is her cell phone, tammys cell phones, which is your girlfriends so it is his girlfriend tammy this is the number this is her direct line, period tom, is that dose she work there . Sure does. Yeah. Your girlfriend works for a dealer that sells your products. Thats correct. Shes not allowed to be working anything to do with this company a dealer who produced half our volume last year. I dont give a [bleep] you know what, nancy . Youve put us in this situation. Take your drama and take it elsewhere. You want to start airing the dirt, nancy . Maybe you shouldnt have been at a wedding and [bleep] some guy in a bathroom i cant work with you you know what . the deals off the deals off i cant do business with you guys. I i cant do business with you guys. Well, when you want to do business, give me a call. Thats all right i mean, as far as that goes, theres other theres other people. I have a backup plan, so. I still love you, though, marcus can we go out on a date now . [bleep] you. Yes, i did go on a date with nancy. No, i did not. Of course, i didnt go on a date with nancy and she asked me like three times. I dont give a [bleep] in the case of tom and nancy, the crazy was so elevated, that their ability to even be in a room together was impossible. But there are other situations where people actually can work through their family drama. A good example of that would be courage. B, a womans fashion brand in new york city. Now the owner Nicolas Goureau had taken the business over from his mother when the business fell on hard times. But my issue with nicolas is that he didnt respect his mom. He was abusive, he was outspoken, he didnt really appreciate what she had built. And i knew i had to get to the root of the problem. Nicholas you have your job to do your job is to come up with an idea and then it is your job to advise. So when the product comes in, we will tell you whether it is financially and logistically feasible to do i cannot take it any more. I i need to kind of understand what i just walked into. I dont know what to do when he starts like that. So this is my fault, im not a good son, i dont she never said that, no. I dont take care of you, i havent taken bullet after bullet for you. And we started this business with debt that weve just gotten ourselves out of, okay, that your children have been carrying you want all of the accolade without doing any of the work but after spending a lot more time with nicolas, i came to realize that he was dealing with a lot of, a lot of baggage, a lot of things from the past, about his fathers passing, about his mothers role, about his sister, about the burden he felt. And he really hadnt had anybody to talk to. When you walk in that door. I am her boss. You are her boss. Byou also would never talk to an employee that way. So why do you . I think my sadness is manifesting itself in anger. Its just sadness ive been carrying my whole life. Look, Family Business inherently brings drama and history, but in this case, i wanted to get some long, festering issues out on the table. This is another piece of that puzzle. What is . Our relationship. I mean, she is everything. Mom, dad, friend, partner. Employee. Employee. Discipline her to be creative, but be constructive. And be encouraging and be supportive. Shes your mom first. Yeah. And shes your employee last. Dont ever forget that. Shes your mom first and she will smack you upside your head. Maybe she should more often. Yeah. Come here. Look, these relationships, theyre theyre never going to be perfect. And once you dig into the root of the issues and you really peel back the onion to find out how to communicate effectively, then you make progress. And thats how i felt after nicolas and i talked. Ive seen him really mature. Today, great family man. I think the thing, guys, that maybe is the best, is that the relationship of all of you has transformed. Oh, i love my children. Yeah. Stephanie its true. Lemonis and by the way, nicolas sister stephanie could be maybe one of the best examples ive seen of personal growth, even if i look at every episode ive ever done on the show. She went from taking the backseat in her familys business to running my 45 million fashion company. And that includes not just the original business, but every fashionoriented business youve seen on the show. The honest truth about some of the biggest fakes, phonies, and frauds in profit history. I feel like youre lying to me about something. Im im not. Plus, ill reveal the one thing my favorite Small Business owners have in common. And its not what you might think. Resolution 1 binge more. Join the uncarrier, and get four unlimited lines for only forty bucks each. Plus, netflix for the whole family. On us. So, they get their shows. Lets go, girl youre gonna love this bit and you get yours. Watch however you want. On your phone, tablet, or tv. For just forty bucks per line. With no extra charges. Lets rock this joint all on americas best unlimited network, tmobile. The chase mobile app changed the game for us. We had this plan to go to the hottest place on earth, harness the energy from the sun to develop popcorn. We thought we had the right equipment, we quickly realized we needed more. We were able to send a Wire Transfer to a local vendor and get more Solar Cookers delivered, right here in death valley. Manage business expenses from virtually anywhere. The chase mobile app available with business checking. Chase for business. Make more of whats yours. When this guy got a flat tire in the middle of the night. Hold on dad. Liberty did what . Yeah, Liberty Mutual 24hour roadside assistance helped him to fix his flat so he could get home safely. My dad says our insurance doesnt have that. Dont worry i know what a lug wrench is, dad. Is this a lug wrench . Maybe . You can leave worry behind when liberty stands with you™. Liberty stands with you™. Liberty mutual insurance. Limonis since i startedbeen four ythe profit,pisodes and ive had people tell me on the street that i i like to do business with softies. People that are like, nice, they cry all the time. And i guess my response is, i appreciate doing business with people who can be real and show me all of their scars and all of their frailties, because it gives me the sense that theyre never hiding anything. So thats rule 5, be vulnerable. I built it for, for my brother, for my family. I feel i failed them. I really do. Its hard to be on the verge of feeling like you might not believe in it. We did whatever we had to to survive and never let any of them up there know what it took, or a customer. In seven years, people got bonuses. We didnt get paid. I just feel like i failed. You are not a failure. Well, i want to stop feeling that way. Well, thats why im here. For lots of folks, obviously, vulnerability doesnt come easy. It takes a lot of courage to really open up and own your story. Take the guys from flex watches. Their original line consisted of a variety of watches in different colors, each representing a different cause, like cancer, or hunger. And a portion of their sales would go to that charity. But oddly, they drifted away from it. Lemonis wheres the charity angle on this generation . A lot of people dont realize we still do the Charity Aspect. I think this is a total miss. It doesnt feel on point with the brand. If you guys have a mission, you should stick to your mission. I soon learned that one of the guys, trevor, was the reason that they had gotten away from their original mission. And thats because in his mind, the Charity Aspect connected to the watches, is a direct connection to his mom. And that brought back a lot of very painful memories. She she got Breast Cancer eight years ago. We lost her three years ago. She passed away. Yeah. What was your moms name . Karen. Is your moms name incorporated into . No, weve actually talked about that but, were just not able to go there yet. Trevor went through a tough time, obviously, after his mom passed. Trevor because of me, probably, we just havent talked about it and discussed it as much as we should and i dont know how to tell that story. Its tough. I feel bad. And i feel bad for my best friend. Thats it. I mean, no one deserves to like, go through all that stuff. Just, it hurts, you know. I pushed him to embrace his story, cause i knew it would bring him closure, but most importantly, help the business, as well. But he pushed back and pushed back. I dont know if the face of the brand is supposed to be so much about me and my mom. As much as thats our story, like, i just struggle with talking about it. Until eventually he got there. He personally prepared a video for flexs website, which paid tribute to his mom and the impact she had had on the business and it was incredibly powerful. Love my kids. We feel so good. Its its crazy, we feel so inspired again, to to share with people about these causes that we care about. The reality of it is, is that the reason your business was good is cause people liked the story. And you had to fall in love with the story again yourself. Theyve turned out to be one of the best businesses ive invested in, not just because weve sold some watches, but because the willingness to show their true colors, to be themselves, and i really made a point to break them down to get the best of them. Of course, if youre going to tell your story, youd better make sure its a work of nonfiction. That brings us to rule 6, be authentic. I think people can get confused between telling your story and having it be authentic and telling a story and trying to convince people that its authentic. Take max from murchisonhume, a seller of highend cleaning products. Toilet bowl cleaner, surface cleaner, you get the idea. And youd had thought she was selling fine art. Watch me through this. So we used to have a textheavy label. I wanted to make it easy for the customer to identify, so for me, its an icon. Im going to challenge you on that. Oh, no. I feel like its like, buying products for my castle or something. The chair is kind of like a chair that would be in a castle. Anybody have a chair like that in your house . No. I do. And she didnt just have her head in the clouds when it came to her product, the company was on the verge of collapsing and yet, she was carrying on like everything was fine and it was perfect. Max, it feels like you guys are slightly delusional about whats happening. Its like, it doesnt feel like a company in crisis to me. She fought me on the name of the company, the look, any change she saw as a threat to the upscale image she was trying to cultivate. But when we discovered that her inventory was worth just a fraction of what she thought it was, well, that didnt even seem to faze her. So how much is actually here . Its about 33 pallets, so not the 120 pallets that we thought. So youre telling me you dont have 280,000 of inventory . No. How much is actually in inventory . Like 70,000. But i made a deal based on this information. Sorry . I ended up walking away. Because i finally realized that it wasnt about the company or the brand, it was about max. It was more important for her to create this image of wealth and success and this aristocratic lifestyle. But it was it was fricking toilet bowl cleaner. I mean. Trying to create a story is important, but having that story be authentic and having it be believable and having people want to embrace it, like shulers. If fat aint dripping on the coal, its not barbecue. Thats a story of a family that just lives on a big tract of land, that loves barbecue, that theyre just thats just who they are. They wouldnt change for anyone. Not even me. Case in point, when i tried to change elaines biscuit recipe so it would be better suitable for mass production, oh, no, not going to happen. Elaine this is crazy. You know, it is a family recipe. Im trying to adjust, but this is not us. Thats a story. But its authentic. And you know what . People line up down the street to go there. Now, its this massive complex, like on 10 acres. Theyve undergone a huge expansion, outdoor deck, general store, catering, and what i love more about them than anything else, theyre authentic. Yes, sir. Theres nothing better. Shulers and and murchisonhume could be the greatest juxtaposition of authenticity. Marcus, some tea. So vulnerability is one kind of honesty. Authenticity is another. But theres a third kind of honesty thats just as important. Rule number 7, be transparent. See, vulnerability and transparency are two different things. Transparency is, im going to find out what youre hiding and the more i sniff something that youre hiding, im going to find it. And i have tried to be honest and i have tried to be forthright you havent been honest at all. I do not want to do business with you, because i dont think i can trust you. I feel like youre hustling me. One of my biggest issues with transparency came with sal. Remember him from artistic stitch . This was a small silkscreening and printing business with a huge identity problem. Its a multiplex of businesses that really work together. You get somebody coming in that wants to do shirts. He looks right out into that thing. Now, a friday and saturday night, hes coming in with his family and his kids and hes going to actually eat in the restaurant. Thats whats called a mall. While sal lacked focus and had too many things going on under his umbrella, what i saw was a lot of promise in his core printing business and i thought it could be a huge deal for me. But as soon as we started diving into the finances, red flags were everywhere. Do you have any personal Living Expenses on these cards . Sal im sure there is. Whats the big deal about that, honestly . Im not 100 sure what the cards are not even active. But you were 100 to tell me that it was construction debt. Yput this paper together. Yeah, maybe we needed computers and stuff. It could be. Im not saying no. Wasabi japanese steakhouse. 230. I went out with my family. On the Company Credit card . On the Company Credit card. Now im paying for your meals . This isnt sitting well with me. I okay. And i feel like youre lying to me about something. Im not. But i feel like that, because little by little, the story keeps changing. Despite these hiccups, i went against my better judgement and upheld my deal with artistic stitch, until i went back months later. I felt like i needed to pay them a visit in person, because sal started dodging my calls, not returning my emails, and what i returned to was a total disaster. Sal was lying to me and his landlord michael and the whole thing was about to implode. We look familiar to you . Yes. I have been talking to you at length and im just trying to get paid. Ive tried to help you, michaels tried to help you, and you just struggle with being straight with people. I never, ever did anything, anything at all to go ahead and try to break this deal, whatsoever. Did you take money out of the business that you werent supposed to . To pay some of my expenses that i had personal expenses . You never got my permission to do it. I understand that. Money was going into the business and he still wasnt paid. That was our biggest sticking point, that our landlord get paid. Youre caught with your pants down. Leave him alone youre gangbanging him he cant even defend himself leave him alone. There is no defense. Dont defend guilty people. Im defending him gina. Wheres my money . i havent been paid for three years, hey, and im no good . ive let him slide for three fricking years okay, okay. Gina, please dont go out there. Im closing you down first because i got to get paid thats the facts all right . look, needless to say, i ended my deal with sal. I wish you luck, sal. Thank you. I think sal lied, because he didnt know how to do anything else. He was used to manipulating the facts and manipulating people. But ultimately, the biggest mistake was the one i made. In my gut, i knew i shouldnt have done the deal. I lost about 300 grand. The profit alums who went from underdogs to unbelievable success. Oh, my god. Oh, my god. Lemonis and the ones who faced a shocking end, all because they ignored one key rule. [vo] progress is an unstoppable force. The season of audi sales event is here. Audi will cover your first months lease payment on select models during the season of audi sales event. You know, in all my years ive invested countless hours and tens of millions of dollars. So my offer is 400,000. 600,000. 1. 7 million. Do we have a deal . Yeah. We have a deal. Thank you. We have a deal. Thank you very much, mr. Lemonis. It is a pleasure to have you marcus. But in order for these businesses to be successful or not in the long term, real business has to happen like, after the cameras go away. That brings us to rule 8, its all about followthrough. I think people have this this misconception that im going to come in and run their business for them. Im not there to run your business, im there to push you along and point out things to you so that you could do it when im gone. And there has to be consistency and a following of that process, not the day after or the month after, but years after. Seems pretty straightforward to me. And yet, i have to grapple with this lack of consistency and followthrough again and again and again. I cant be here every day. I know. And these people want a leader and i dont know if you have what it takes. Lemonis the business has a ton of potential. I think the worry i have and i didnt tell this to anybody else, is that i dont think you want to do it. I want to see them get their systems in order. Are you going to help do that . A good example of terrible followthrough is standard burger, a Staten Island restaurant i invested in a couple years back. Its frustrating, because while its still a viable operation today, it couldve been so much more. When i first arrived, i found a group of friends who couldnt have been closer or more volatile. Are you kidding me . listen i was not one day late i live three blocks away what about all the times, hey, nobodys at the burger place to open up, call fuggie . And what the [bleep] are you talking about . Lemonis their fighting had led to a real embarrassment of a restaurant, from frozen patties they used, to the filthy kitchen. So i overhauled their menu, completely renovated the space, put one of the guys in charge as the managing partner, and most importantly, told them they all needed to follow my process and stay engaged if this was going to work. And when i came back a few months later, the guys had made a bunch of misguided changes to the menus that id never approved of. It looks like chaos to me. And they were wasting time scouting potential new locations instead of focusing on the plan, which was to build the National Franchise concept in one place. Were in the business of building a box, marketing it, polishing it, perfecting it, and then having somebody say, ill take one, ill take one. Thats what a franchise is. We are not in the business of leasing space and building [bleep] out. And worst of all, they hadnt followed through on their promise to stop fighting. Im the guy thats here every day whats whats your problem . And youre the guy that shows up once a month whats your problem. Thats what it is thats the problem so if you want to [bleep] start calling my name and [bleep] together, be ready to be a man and stand next to me and say so. Im not calling [bleep]. Im saying theres problems here. I didnt think so. Yeah, theres problems here. Youre the problem. Im the problem . Yeah, thats right. Im the problem . cause you stick knives in your friends backs and you say [bleep] to other people and expect it to go under the rug. So if i tell thats what you expect. Im the rug sweep it under me im not sweeping it under you. Yeah, im the rug im the rug sweep it under me standard burger is still open today, its profitable, but the five guys are not together anymore. Couple of them are just doing their own thing. One of em was fired. In hindsight, i made a big mistake by investing there, in hindsight. It was a 750,000 error. Another big disappointment for me in terms of followthrough, amazing grapes, a wine retailer in california with an absentee owner. So what do you do fulltime . Since you dont come here every day. No. I come in here probably, two, three times a week. Two, three times a week . Yeah. Or two, three times a month . And guess what . Amazing grapes closed. Its gone. I put 1 millions in that business. 1 million. And it closed, because there was a couple people there that did not want to follow the process. But for every business like amazing grapes, theres one like bentleys, a pet supply chain based in the chicagoland area. Lovely people, but one hell of a messed up process. They had grown way too fast. Every store looked different from the next. The merchandising is different, the layout is different, the lighting is different, the whole thing is different. But lisa and gio really put their heads down and trusted the process. Both stepped up as leaders. What we need to do now is just start boxing everything up. And the result, nothing short of amazing. What youre going to see today is kind of the future look of what could be a regional or a national brand. Are you ready . Yeah. Yeah. Ill let you go first. Im closing my eyes. Close your eyes. No, close your eyes, close your eyes. Oh, my god ill look at the floor. Oh, my god oh, my god lemonis and heres the thing, they didnt just execute for the cameras, they followed through long after the cameras left. And guess what . Today, its a 100 million business and top line with, going to be close to 100 stores, where weve received offers for north of 100 million to buy the business. Like, theyre literally going to get like a like a 40 million check. Thats a big deal. You know why . Its because they trusted the process and they followed through. The one thing that still shocks me after all these years. And. Hank, are you [bleep] kidding me . What you can learn from one of the most memorable moments in profit history. Coverage,speed, and control. Nooooooo yes all with an xfi gateway. Find your awesome and change the way you wifi. Rule 9 is one that should go without saying, but it doesnt. People, know your numbers. How much money does this business make a year . I mean, as far as that ill be honest, i dont know the exact numbers. What does it cost to make Something Like this . You know, thats a good question. I cant move forward if i dont know for sure what the numbers are going to be. 9outof10 people still cannot explain where their moneys going. In season one, i visited a small popcorn business run by a woman named sharla. Remember her . I was shocked to find out that her Accounting System consisted of piles of money on the floor. Do you guys just leave money out . Yeah. This would be a cool place to rob. It only got worse from there. There was over 300,000 missing from her accounts and sharla was absolutely clueless, or was she hiding something . The problem is, theres 319,000 missing. Then i guess it needs to be found. Why dont you seem alarmed by the fact that money is missing . I dont think this is all accurate. Im just saying. Oh, and when i tried to get to the bottom of it, she got pissed off. I might not be able to read my balance sheet, but i make 2. Whatever they say, Million Dollars a year. So dont be telling me im stupid and dont know what im doing. He didnt say you were stupid. Oh, please, mother. Its my money. But you should i mean, were only doing what you i did what . Excuse me . What did you start to say . You shook his hand. So what . Lemonis it got so bad that i had to bring in a forensic accountant and even that didnt help. The money should be there, cause there are no distributions, no draws, right . Well, theres no distributions, because theres no money to distribute. But but you have profit. Whats happening is, theres leakage somewhere. I dont know if somebody else is stealing or youre stealing. I i control all the cash, so if anybody is stealing, it would be me, and i dont steal. Okay, so wheres the cash . Wheres the cash . Couldnt tell you. Something that goes handinhand with not knowing your numbers, not paying attention to your margins. So youre making 37 cents on this bat. Thats not great. Its not. Terrible margin. What kind of margin do you make on all this stuff . These are 4. 50 and i sell em for 5. 50. Thats 2,000. And then what does it cost you . About a 30 margin on those. Thats it . Yeah. The reason that i always tell people that they should know their numbers is its the Health Report on the business. In order for you to make decisions about where youre going or who youre going to hire, or what expansion plans youre going to have, you have to understand the current status of your business. So please, know your numbers. Theres no excuse not to. You know what else theres no excuse for . Excuses. That brings to rule 10, quit whining and start winning. Ive seen a lot of Small Business owners who simply do not take responsibility for their actions. What i always tell Small Business owners is to get a mirror. Want to know whos to blame . Its always you. And if you want people to respect you, take responsibility for your mistakes and your actions. Perfect example of someone who could not stop complaining and blaming others, passing the buck, my good friend hank maarse. Blahblahblah. Hank inherited his fathers oncesuccessful flower business. But under his leadership, lets just say that things started to wilt and the place was in shambles. I agreed to invest 100 grand to make some muchneeded changes, but no matter what i did, hank did nothing but complain. Marcus took a lot of stuff out of the store and just kind of dumped it in the garage. Im not sure that the store looks that much better. My confidence in marcus right now is kind of wishywashy. Until just one week into our deal, he backed out. And he blamed me for all of his company woes. I appreciate your effort, but whatever you tried didnt really work. Between you and me, im not going to take your deal. Whys that . Well we had a handshake on it. Yeah. I mean, theres a lot of stuff that you promised that didnt. Like what . That didnt go through. Like what . Well, you said you were going to give us 100,000. I spent over 100,000. Well, i dont know what you did, i mean, i didnt see anything. How much you think ive spent . 150,000. Hank, are you [bleep] kidding me . Yeah. No, im not [bleep] kidding you. You [bleep] trying to tell me that i didnt put money in your business . I dont know what you did, cause you didnt show it to us, so. Would you like to see it . Well, its too late now. Why is it too late . We made a deal and you didnt do it. And you said business was going to go youre kidding me . The sales didnt go up. In a matter of two days . You said thats cause youre never here. You said a week. Thats cause you dont know how to manage this place. Well, thats your opinion. So youre telling me youd better call your mama and get my money back. Honestly, hank can blame anybody he wants, including me. Hank wasnt qualified to run that business. He wasnt jacob maarse and no one was asking him to be. I was just asking him to stop whining. Just get to work. I reveal the lessons ive learned along the way and the people who have changed my life forever. Resolution 1 binge more. Join the uncarrier, and get four unlimited lines for only forty bucks each. Plus, netflix for the whole family. On us. So, they get their shows. Lets go, girl youre gonna love this bit and you get yours. Watch however you want. On your phone, tablet, or tv. For just forty bucks per line. With no extra charges. Lets rock this joint all on americas best unlimited network, tmobile. Replace the full value of your totaled new car. The guy says, you picked the wrong insurance plan. No, i picked the wrong insurance company. With new car replacement™, well replace the full value of your car plus depreciation. Liberty mutual insurance. Let out your inner child at the lexus december to remember sales event. Lease the 2017 rx 350 for 399 a month for 36 months. Experience amazing at your lexus dealer. After 67 episodes, ive seen a lot of crazy things. I figured since your inventorys upside down, i would hang upside down, too. Good, bad, ugly, really ugly. I rarely lose my cool. Well, and i dont want you to. You stepped way the [bleep] out of bounds. Theres been one common theme that ive seen throughout, regardless of the Business Owner, is that they had a belief in themselves and a passion to get into something and to try. I always wanted to be a ceo. I thought it would be the best job in the world and i still do. Even as i sit here today, i go into every single business with the same fresh set of eyes, without any misgivings, because i feel like i have a duty to give that Business Owner who took a chance on themselves, who took a chance by calling me, who better have their numbers figured out, a fair crack at it. Im so grateful that like, you picked our company and i just am excited to like, see where it goes from here. Look, i understand that the profit, is a Television Show that features me investing in Small Businesses. I get it, okay. But this is, for me, was never a show about business, it was a show about people and taking a chance on people. Its not always going to be fun, but my job is to make sure that you guys have a bright future. [ chatter, laughter ] and it was a lot of fun. I learned a lot about myself. I learned that i can learn anything if i try hard enough. Lemonis chris, were good. I got on, i dont like the margins. So ive pretty much established that this whole thing sucks. And you dont have to be an expert at everything. You could partner with somebody that is an expert. I know nothing about making candy. But i always wanted to own a candy store. Its good. I didnt really get a good taste. I need another one. And i could almost argue that pete and allison made my dream come true. Ive cried with Business Owners. I was eight years old. Thats what i remember. And ive screamed to the top of my lungs. [ shouts ] guys, shut up for a minute, shut up whats come out of it for me, and i think for a lot of other people, is how to treat people, how not to treat people. But isnt that a life lesson, in general . Take a chance on really good people, it will work out . I never wouldve dreamed, never wouldve dreamed this, never. Thank you, marcus. Dont invest in really bad people, bad idea. How is that any different than relationships, hiring . I mean, how is it any different . All right. Whoo whoo Nice Distance lemonis tonight, on a special edition of the profit, ill take you to puerto rico, american paradise crippled by a perfect storm. Reporter Hurricane Maria slammed ashore, with torrential rain as much as two feet, turning roads into raging rivers. Reporter 2 the situation here is dire. Maria, the worst hurricane to strike the island in more than 80 years. Im Marcus Lemonis. I had to see it myself. I have friends here, and i wanted to help them get out. Thank you for your service. It was chaos, crowds of people just waiting for help