We need to tweak it. Lemonis his sales pitch definitely needs work. I think you guys have done a [bleep] job explaining to them why they need to own it. And his Business Plan needs a reality check. I think your numbers are obscenely wrong. If i cant get him to loosen up and work on collaborating. Ethan i think there were a lot of people that were saying the same thing about a car, when henry ford came out with the car. They were happy with the horsedrawn carriages, but i think that, you know, longterm, worked out in a different way. Lemonis . This company may be up a creek without a paddle. Weve got a deal . Ethan uh. Uh, well, i, the. Um. Lemonis my name is marcus lemonis, and i risk my own money to save struggling businesses. Were not gonna wake up every morning wondering if we have a job. Were gonna wake up every morning wondering how many jobs we have to do. Its not always pretty. Everythings gonna change. Everything. But i do it to save jobs, and i do it to make money. This. Lets go to work. Is the profit. [ train whistle blows ] im heavily invested in the outdoor space with Companies Like camping world and gander outdoors. And so when the company reached out for help and i went online and did a little research, i was intrigued because there were products that i had never seen before. Theres a level of technical ingenuity that you just dont find in most outdoor products. And if i can figure out a way to strike a deal and get access to distribute these products, it could be a winwin for everybody. Ethan hello. Lemonis hey, how are you . Lemonis pretty good. How are you . Lemonis im good. Im marcus. Ethan yeah, welcome. Nice to see you. Lemonis what is your name . Ethan im ethan. Lemonis ethan, nice to meet you. This is cool. Ethan yeah. Lemonis so, smithfly, tell me a little bit about the company. Are you a fly fisherman . Ethan oh, yeah. And i was just frustrated with what was on the market at the time. I started doing some of my own design work. So, this was the core product line, which is based on kind of the military concept of modular packs and bags. Like, this is molle webbing, which stands for modular lightweight, loadbearing equipment. You can mount multiple pouches, too. I sort of introduced it to the fly fishing side of things. So, like, i brought it to them. Lemonis so, what is this bag used for . Ethan uh, so, it holds tippets, spools, and like, fly boxes and kind of everything you need to be on the water to fish. Lemonis this is for fly fishing. Ethan mmhmm. Yep. Lemonis and are these straps right here . Ethan those are for, like, a belt. But the cool part is, straps mount to here or a padded like waist belt that you can mount multiple patches to. So, the idea is people can build their own packs. Lemonis this is awesome. Ethan yeah. Lemonis whats really cool about ethans designs is that the user can actually customize exactly how theyre going to use his products, and its almost like legos for an outdoorsman, where they can bolt on Different Things or strap them on. Its kind of fascinating. What did you do before this . Ethan uh, i was in retail design. We actually did the original Gander Mountain design, like, believe it or not, like. Lemonis the inside of the store . Ethan yeah, the whole retail design was like, our package. Lemonis did you design all this, as well . Ethan yeah. And the interesting part about this is, these little lasercut slits is a pretty unique feature that i designed. Lemonis is it ventilation . Ethan no, its actually for my pouches. Lemonis so, all these slats have a purpose. Ethan right. And theres nobody else that makes this. Lemonis this stuff is fricking awesome. Its more of a tool than it is a jacket. But feels a little big. Ethan ive always said that like, im not really in the fashion business, im like an industrial designer. Function comes first for me a lot of times, so like, in the industry, ive gotten a lot of critiques from the soft goods side that say my stuffs a little drab. But im like, hey, you know, like, theres the people who get it, get it. Lemonis i thought it was odd that ethan got really defensive over something as simple as me commenting that the product that i just put on was a little big. I wasnt criticizing the product. Whats the name of the boat . Ethan the big shoals raft. Shoals means, you know, shallow water, and big means big. So, its a big thing that you can put on really shallow water. Were doing it better than other people cause it weighs 125 pounds, so two guys can pick it up and carry it to water. And we use materials that are really, really good. So, the competitions making stuff in china, and were using really thickwalled aluminum, doing all the bending and welding inhouse, solid onepiece welded frame. And thats what people love about it, is its stability, the lightweightness. Lemonis this. Ethan yeah. Lemonis and then, whats this . Ethan thats the same boat, just different color. It fits in the back of a pickup truck. Lemonis what does this cost to make . Ethan 1,500 bucks. Lemonis and what are you selling it directtoconsumer for . Ethan right now, were at 3,848, is the msrp. Lemonis thats a pretty good margin. Ethan its okay. That includes 500 bucks for shipping. Lemonis mmm. Ethan cause then the people i know. And its like, logistics on these things have been a fricking nightmare. Lemonis heres the problem, right. We have the same problem in the rv business. People are going to shop the price, and if you bury it in the price, your competitors are going to prey on that. In todays competitive ecommerce environment, consumers are going to start by shopping on price. Ethan gives himself an immediate disadvantage by the way he presents the price to the consumer. Because the competition is going to sell the product, then theyre going to add shipping and whatever other costs are associated with that. Right out of the gates on a comparative basis, he loses. I mean, honestly, i would buy one of these, and i dont i dont even know what i would do with it. Ethan youd have a lot of fun. Lemonis id probably put it in my pool or something. How did this come to be . Ethan its pretty cool, isnt it . I said, how about we merge the raft and the tent . Its a big thing that you can put on really shallow water. Lemonis im going to say, this is the coolest fricking thing ive ever seen. Ethan weve had 100 million views on facebook of this. Theres never been one in the world. Like, this is the first one. Lemonis i think theres things that you can still add to it. Ethan we just tell everybody like, when they buy this, you have to know and understand your safety regulations. So youve got to have life jackets, youve got to have an anchor, youve got to have paddles, you know, youve got to have backup paddles lemonis and you have all that . Ethan no, we dont sell that lemonis you should sell all of it. Ethan oh, i know. Lemonis how many have you sold of these . Ethan 50. 50 or 60. I cant ive lost track right now. Lemonis and what does it cost to make this, fully set up . Ethan its about 500 bucks and it sells for 1,499. Lemonis dude . That price needs to go. Ethan up, you think . Lemonis yes ethan im im with you. Im just not that hardass, and i need to be more. Lemonis ill ill be the hard ass. Ethan thats why youre here. Lemonis have you ever been to an event where you go into this booth and theres wind and theres cash moving around . Ethan oh, yeah. Lemonis thats what this thing is. Okay . This thing is a giant cash machine. Ethan oh. Well, im glad you think so, too. Lemonis how do i get from point a to point b . Ethan we build a trailer thatll hold this and the tent. Lemonis how do you sell today, directtoconsumer . Ethan pretty much. Yep. Lemonis online . Ethan yep. Everythings ready to go. We just have to be caught up on production, which weve never been able to get, cause i cant float all that money out there. Lemonis are all of your inventory issues exclusively related to working capital . Ethan almost entirely. Lemonis whos handling, like, the ordering overseas . Raw materials, picking the colors, coming up with new ideas . So, theres no help . Ethan jules. Like, its me and jules. Jules hi. Lemonis and, jules, what is your role here . Jules to do whatever ethan asks me to do. Lemonis you do the accounting . Jules i do. Ethan the office manager, admin kind of position. Jules and i really wanted to work here. So, i took guiding trips and learned to fly fish and lemonis just for this job . Jules just for this job. But i totally believe in what hes got here, and theres so many opportunities that we miss. We have rafts that are back ordered right now. And we lost sales on the tent because we couldnt fulfill the orders. Lemonis and you didnt have them in stock because you didnt have the working capital to actually put them in stock, right . Jules right. Lemonis if you dont have excess working capital, it could be just as detrimental to a business that has too much inventory. Its like everything just gets locked. Ethan oh, yeah, stuff gets pretty tight and scary. Lemonis and what about where they would all get stored . Like, if you had halfamillion dollars in cash, you could buy inventory, where would it go . Ethan ive got a huge basement that i can store stuff in, and i do have like but like, were working on buying the building across the street. Lemonis how big is it . Ethan its 55,000squarefeet. Lemonis im not sure i understand what ethans business logic is, of wanting to buy a 55,000squarefoot building to store inventory that he doesnt even have, and furthermore, hes got a building that has a basement. Jules when i started last year, it was ethan and his dad and his fatherinlaw. Lemonis oh, your dad works here, too . Ethan uh, he did for awhile, yeah. My mom kind of got sick again, and so hes been taking a break for a little while. Lemonis your mom okay . Ethan yeah. Yeah, yeah. Well, actually, the day i quit my last job to start this, she got diagnosed with stage 4 lung cancer. Lemonis oh, man, im sorry. Ethan yeah. And, um, yeah, so, sh um, it was the same day i left my job. But, like, they think theres lots of options, still. Shes still got a lot of life in lemonis hows she doing now . Ethan actually, shes doing pretty well. So, anyway, hes hes kind of taking a little bit of a break. But then weve got some new guys in from the Welding School that are absolutely topnotch, like, worldclass welder. Lemonis so, what, are these the frames . Ethan yeah, these are the frames that are raw before they go across the street for powder coat. Lemonis so, what does that frame cost . Ethan probably 750 bucks. Lemonis your boat costs about 1,500 to make today, and the frame is half of it, at 750 . Ethan right. Lemonis hey, ethan, im going to spend a minute with jules, without you, if thats all right . What do you ultimately want to do here . Jules me . Lemonis yeah, you. Jules i personally think i would be awesome at the sales. Lemonis you do . Jules im passionate about the products. When people call and i get the call, not ethan, i can sell the boat just like ethan can. Lemonis any time i meet somebody thats raising their hand saying, i want to be part of the sales organization, tells me that they believe in the product and they want to be part of the future of it. Thank you for chatting. Jules oh, no, of course. Lemonis see you in a little bit, okay . Jules yes. Ethan okay, so this is one of the trailers. Lemonis is it pretty sturdy . Ethan yeah, you can climb up there. Lemonis yeah. The trailer looks janky. Ethan janky . Lemonis see like, theres a lot of sharp edges on this. But you can tell its its homemade. cause you just need somebody that does mass welding. I give ethan a lot of credit that hes thinking outside the box, looking for additional products to add to the company. And while that may happen in the future, its probably better for him to outsource some of those things and focus on making the Core Products that he has perfect. Wheres our tent . Blow that bad boy up. Ethan comes already set up. Lemonis hold on, im going to time this, cause thats important. Okay. [ air pump whirring ] [ whirring stops ] ethan what happened . Jules i dont know. Lemonis fuse . Ethan blew a fuse. Lemonis try again. So, if im spending how many thousands . Ethan 1,500. Lemonis 1,500. Youve got to just remember that this changes the experience for somebody. Theyre like, what the. . Ethan yep. Lemonis if you werent by a car, what would you do . Big problem to solve. Jules mmhmm. Lemonis huge. Ethan i can go get the other pump, and we can be pumping both at the same time. Lemonis yes, please. Jules [ laughs ] where are we . Lemonis 22 minutes. Ethan its coming alive. Lemonis ready . Ethan yep. Lemonis turn sideways, ethan. Ethan its easier to paddle from the side. Lemonis this thing is awesome. Ethan thank you. Theres an airbnb for nature in australia that wants to do, like, 500 of em. Lemonis the fact that ethan has demand from a place as far away as australia tells me that theres an international play here. Ethan highfive. Lemonis whats to say that people in south america or in europe may not have the same interest . Ethan we wouldnt be able to do this with a real, you know, heavy jon boat or Something Like that with a big motor on it. Lemonis i still think you could figure out how to take weight out of it. Ethan uh, no, you cant. Lemonis couple comments on the seat. It is flimsy. Ethan dont lean back like that. Lemonis and its a little yeah, but you need to be youve got to think that somebodys going to want to. Ethan pull it up, pull it up. Lemonis am i holding my hand right . Ethan yep. And then just throw the line back. Its really a stop at 10 00 and 2 00 is what they say, so its 10 00 on the clock face. Lemonis stop. Ethan yep. A lot longer on that back half. Lemonis i feel like i fly fish very well. You didnt see my wrist, how about it . My outfit was right, i was good. Where do you think the business can get in the next five years . Ethan ive got a plan that i think we could do 20 million in revenue. Were not there now. Like, this years breakeven. We lost money last two years in a row, so. Lemonis you did . How much did you lose . Ethan last year, i think, 68 grand. Lemonis and how are you funding that loss . Ethan with duct tape and bailing twine. No. Lines of credit. Like, ive just not paid myself at all. But yeah, i mean, i think with the right scale and the right partners, you know, we could get to 10 million, 20 million a year in revenue, i mean lemonis okay. Well, why dont we go back, lets dig into the financials, and lets see if we can do something. Ethan okay. Yeah, yeah, absolutely. [ train whistle blows ] lemonis how are you, buddy . Ethan good. How are you . Lemonis everything good . Ethan yeah, yeah, have a seat. Lemonis yeah. Ethan its great. Lemonis so, did you bring your Financial Statements . Ethan uhhuh. I dont know what we want to start with or whatever, but. Lemonis lets start with the pnl. Ethan okay. Lemonis what year is this . Ethan these are just vendors. This is this year. These are sales, raft sales here. Lemonis 238,000. Ethan and then theres shoal tent sales here, was 70,000. Lemonis so, the business, you think youll do 400,000 for the year . Ethan yeah. Lemonis 400,000 a year, plus or minus some revenue. What was your revenue last year . Ethan about 250,000. And about 150,000 the year before that. Lemonis 150,000 of revenue you lost. Ethan 48,000. Lemonis 2017. Ethan 68,000. Lemonis 68,000. And this year, youll probably do around 400,000. Ethan we could be close to breaking even. Lemonis how much debt do you have today . Ethan 240,000. Theres a sheet over here with that. Lemonis liabilities, 36,000 in payables, which are just your vendors. Ethan mmhmm. Lemonis and 238,000 in loans. Ethan mmhmm. Lemonis you own 100 of the Business Today . Ethan mmhmm. Lemonis i like the product, i like the way it was made. I like the fact that a lot of the parts and pieces are made here. I like the fact that you think about the functionality of it. And so, id like to make an offer to invest in you and invest in the business. My offer would be 1 million for 50 of the business. Weve got a deal . Ethan uh. Uh, well, i, the. So, um. Baker when i think party raft, i think of, how do you put a cooler in it, how do you put cup holders in it . Ethan and we got 100 million views of it, right . Its a unique product. Chris its a tough sell. Bruce yeah. Lemonis i think you guys have done a [bleep] job explaining to them why they need to own it. Lemon wild thing, you make my heart sing. You make everything. Groovy. Done yet . Yeah, yeah, sorry, sorry. You sure . Hmm. Mmm. Come on, come on, wild thing. If you ride, you get it. Geico motorcycle. Fifteen minutes could save you fifteen percent or more. If youre 55 and up, tmobile has a plan designed just for you. And, for a limited time only, were making it an even better deal. Now you can get two lines for only 55. That includes unlimited talk, text and data. With no annual service contracts. It also includes talk, text and data when traveling in mexico and canada. So if youre 55 and up, you can now get two lines for only 55. 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Xfinity makes moving easy with twohour appointment windows, even on nights and weekends. Go to xfinity. Com moving to get started. Uh, well, i, the. So, um. Weve got a deal, yeah. Lemonis im excited. Ethan i am, too. Itll itll be good. Lemonis all right, my man. Ethan awesome, man. We had fun. Lemonis okay, my man. Ill see you soon. Ethan thanks. Lemonis thank you. Welcome to kenosha in order to hit the ground running, i brought ethan and jules to my gander outdoors store in wisconsin. What i ultimately wanted to find out is, do the people that work at the stores and the people that shop at the stores actually like the products . What are the things they think could be better, and what do they think would sell right away . Ethan the frame we make inhouse. Its all one piece, so its never going to creak or squeak or get loose. Chris the seat would worry me a little bit. Ethan but they are the lightest seat on the market. Bruce if the seat breaks, you kind of lose a little bit of credibility with the quality of the boat. Youve got to get the seat right. Lemonis chris, does it need to have a trailer . Ethan inflated, it fits in the back of a pickup truck. Lemonis okay. But not everybody has a ethan oh, right, right. Bruce itd have to be a pickup. Lemonis well, lets lets take it a step further. Whats our primary business . So, how is this transporting in an rv . That frames not fitting in there. Ethan no. Chris youd still have to break it, sidetoside. Lemonis were going to need a frame that is a collapsible frame as an option. Bruce nothing fits right now, so youre really limiting yourself to only be a toy hauler owner that can take the boat. We need to tweak it, we need to get it right. Lemonis what do you think of the brand name, smithfly . Chris in this, it makes me think about fly fishing. I mean, you might pigeon hole. Would definitely, you know, see it as a fly fishing application. I notice everythings green, green and black. Is there different colors . Youve got. Ethan we dont do a ton of different colors right now. I mean, its pretty drab. Fly fisherman are pretty boring. Chris could you see it as a hunting application . Could you see it as camo . Ethan no. This is the jacket weve probably sold the most of, but its, uh, for fly fishermen. Lemonis i understand that ethan cut his teeth on fly fishing, but in order for the company to truly grow, he has to change his thinking. Lets get away from singularly fly fishing, and lets think much broader. So, i thought itd be a good idea to maybe let jules take this one. Lemonis what did you say to me when we were together . Jules i would like to sell this thing. Sales . Lemonis there we go. Perfect. Lets go. So, heres your audience. Jules okay. Well, this is our shoal tent. Uh, evolution of the shoal tent was really, um, sort of very quick. So, what we have here is, uh, the initial, uh, model, but wed like to improve it. Um, i would ask you to step inside, cause i think thats one of the biggest selling points, is really seeing that hardstitch floor. We can take sides off. If youre the owner, youre going to learn very quickly that one panel at a time probably makes it a little bit easier. Bruce does it come with a pump . Jules it comes with a foot pump. Bruce a foot pump. Okay. Baker for 1,500, it needs to come with a real pump. Ethan i mean, its a piece of electronics that youre putting in a water boat that like, you know, its a point of failure that, like, we might be introducing. Chris does it come with any type of anchors . Ethan it does not currently come with anchors. You know, anchors are pretty specific to what water type youre on. Baker the other thing i was thinking was, its a party raft. So when i think party raft, i think of, how do you put a cooler in it, how do you put cup holders in it . It has speakers . Yes or no . Ethan no. We got 100 million views of it, right . Its a unique product. Chris its a tough sell. Bruce yeah. Ethan i think there were a lot of people that were saying the same thing about a car, when henry ford came out with the car. They were happy with the, you know, horsedrawn carriages, but i think that, you know, longterm, worked out in a different way. Lemonis im a little surprised how ethans handling the feedback from people who potentially could sell his product. Instead of him being openminded and just taking it and processing it, he gets a little snarky and sarcastic, which is a little embarrassing for me, to be honest. Lemonis i think you guys have done a [bleep] job explaining to them why they need to own it. Tomorrow morning, were going to work on some products, i want to work on some ideas, so i hope you have a sketch pad of some kind. Ethan i dont generally lemonis you dont . Jules we do. We have a sketch pad. Well get it. All right. Lemonis i didnt feel like ethan really accepted the criticism very well yesterday when we were at gander. So, in order to make sure that he truly understands where i want him to go, were going to meet again today so that theres no confusion on what my expectations are. What did you guys hear . cause i know what i heard, and so, for me, i want to understand how well you processed the feedback. Ethan i think we got, you know, compliments on the size of it and the height of it. Its got a lot of room in it. So, i heard that a lot. I didnt hear a lot of the negatives, though, and i dont know what changes they really suggested. Like, i dont know. Um, as far as i do . Lemonis no, dont help him. Because this is why i think its best that you and i found each other. Because you hear the positives, as you should, cause you should get recognition for the solid work that you did. But you dont tend to hear the negatives. Ethan right. Lemonis . Either because you dont want to or because ethan i get defensive. Lemonis or you dont agree. And typically when people get feedback and they dont agree with it. Ethan yeah. Lemonis so, we both heard things. What did you heard nothing . Ethan i mean, i i, yeah, i guess i just dont remember any of the negatives, so just like, like you said, just kind of. Its 55,000squarefeet. There were some epa issues. Somebody poured some chemicals out back here. So, they just need to dig out some dirt. Its just, the bill was going to be, you know, 2 million. So, weve actually come to a well, yeah. Lemonis so, we both heard things. This is my body of proof. Proof i can fight moderate to severe rheumatoid arthritis. Proof i can fight psoriatic arthritis. With humira. Proof of less joint pain. And clearer skin in psa. Humira targets and blocks a source of inflammation that contributes to joint pain and irreversible damage. Humira can lower your ability to fight infections. 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When they offered me the position, i said, of course, yes. I really love the company and the people. Everyone around me is just as passionate as i am. Its not just a job, its a purpose. Saving for avas college. Financial security. Being able to retire. On our terms. No matter what your goals are, our trusted advisors can help you reach them. Ameriprise financial. Our trusted advisors can help you reach them. How do you gaveeno® happy 24 7 . With prebiotic oat. It hydrates and softens skin. So it looks like this. And you feel like this. Aveeno® daily moisturizer get skin healthy™ you can enjoy the seafood you love from the comfort of home. If it ever makes it there. Spend 30 and get free delivery at red lobster dot com. If it ever makes it there. What did you heard nothing . Ethan yeah, i guess i just dont remember any of the negatives. Lemonis its a bit bizarre to me that ethan literally has zero recollection about the feedback that he just received yesterday. And its either because hes basically tuning everybody out because he doesnt want to hear it, or hes not processing it because he doesnt agree with it. But in either case, not acceptable. Can i just borrow this for a minute . Jules sure. Lemonis this has an interesting look to it. Ethan uhhuh. Lemonis these are a lot of feedback notes. This is listening. Ethan mmhmm. Lemonis this is the difference. And so, ethan, i wanted to give you a little feedback last night of what i got from the team. Two comments. One, everybody wanted a camo pattern. It has to exist. The other comment was, what accessories exist, and what accessories can be developed for different categories. And they said that they probably could double or triple the sales if the name was different. Ethan oh, ive actually gotten quite a few compliments from the industry just because smith has the whole, making things with your hands, sort of metal working background. Like, thats, you know thats my family. Lemonis according to them, you could potentially lose somebody jules the fly part. Ethan right. Lemonis what they want to do, is they want to order all of this for spring. They just want it to be smith. I would be thinking about name alternatives. Ideally, you would land on one thing that can be merged everywhere so you dont have to have multiple skews. Ethan yeah. Lemonis if ethans company ever has a chance of being successful, he has to understand that hes going to have to accommodate the feedback that hes getting or theyre not going to buy the product. And if they do buy it, theyre not going to be excited about selling it. But dont think negative. Ethan yeah, yeah. Lemonis constructive criticism is constructive, meaning that it makes things. Better. Ill see you guys in a couple weeks, okay . Jules yep. Lemonis ill see you in a couple weeks. Jules thank you so much. Lemonis thanks, guys. Ethan wanted to show me the building that hes contemplating purchasing, and so were going to head over, and ill take a look with him. Is this the building . Ethan this is the building, yep. Lemonis wow. The buildings huge. Ethan its 55,000squarefeet. There were some epa issues. 40 or 50 years ago, we dont really know when, somebody poured some chemicals out back here. So they just need to dig out some dirt and then put fresh dirt in it. Its just, the bill was going to be, you know, 2 million. So, weve actually come to a well, yeah. But if we do the work ourselves, it can cost a lot less. So, we can probably get it down by a factor of 10, to maybe 200,000 or 300,000. Lemonis i dont like the fact that ethans like, oh, its only 200,000 or 300,000, as if there was just money flowing everywhere. And thats just for the outside of the building, which makes me wonder what the inside of the buildings going to look like. Holy moses. Ethan he rented this out to a guy who stores like, stuff to flip on craigslist and whatnot. Lemonis are you seeing what im seeing . Jules oh, yeah. Theres some good stuff in here, too. Ethan yeah. This is just the tip of the iceberg. So, you have to kind of look beyond all this stuff. This is all junk, basically. Like, all of this is what wed clean out and occupy. And then all these windows replaced, everything cleaned up. Like, this is kind of the admin space up here. And the sewing section would kind of either be out here on the. I knew youd be overwhelmed, but we havent seen upstairs yet. Lemonis okay. Um. Ethan so, this, you put a railing around it, and its the patio lunchroom. Like, theres third floor is right here lemonis is he serious, or is he just messing with me . Jules oh, no, hes serious. Ethan im not messing with ya. Come up here. So, when were a 100 million business, the final buildout has that third floor on it, right. Now, i mean, how much does it cost to build this out . Another million dollars. But then weve got a 13 Million Building instead of a a 5 million of a 3 million. Lemonis why would i want to put 1 million or 2 million in a dilapidated building when i could put 1 million or 2 million in Product Innovation and inventory and actually sell it and make margin . This is a really simple lesson for most Business Owners called Capital Allocation. And Capital Allocation is a term that a business would use to determine where it is that they want to spend their money. If they have a finite amount of capital, they have to really prioritize where they think that capital is going to get the company the best return on investment. In the case of smithfly, its Product Innovation and inventory that the markets going to sell, not warehousing and stockpiling stuff. Hes almost trying to be too big, too fast. Baby steps here. I love the fact that its here, though. Thats awesome. Ethan yeah, its right there. Lemonis it probably would only take six years to get all this stuff out of here. Ethan [ laughs ] lemonis now that ive slammed on the brakes of building this massive corporate campus, ethan is buckling down and working on ways to upgrade the shoal tent. Jules so, the Little Shoals is a twoman, uh, raft, but the big shoals holds three, as well as the great big shoals. Lemonis meanwhile, jules is working on sales, focusing on the Core Products that they already carry. Jules thanks for calling, and we look forward to working with you. Lemonis . So that ethan can focus on upgrading and developing new products, things that could bolt on to tents and improvements to the current apparel products. Im looking forward to seeing how everything turns out. Ethan told me that he finished the branding changes and the Product Modifications based on the feedback he got from gander. I would be lying if i wasnt telling you that i was nervous to see if he actually did it. This looks different. What did you do differently here . Ethan so, this is, like, the new frame, so itll break down and go in the bottom of an rv. So, this is kind of the prototype of it, so its not donedone. But basically, its an erector set and everything comes apart. Lemonis this seat looks different. Ethan yes, the upgraded seat weve been doing. Lemonis ooh, the seats a lot sturdier. Honestly, the fact that you got it done that quick is a testament to how you move. Ethan so, the tent was one of the hot topics that we talked a lot about, right . Lemonis yeah. Ethan so, basically, you know, we talked a lot about color, so i think we can do some cool color toppers, right . We can make something work there. Weve got the interior light kit kind of concept. Lemonis all led . Ethan mmhmm. Yep. This is our inflatable drink and cooler caddy that we talked about. Lemonis this is exactly why i took a chance on ethan. You can tell that his Technical Knowledge really, really got implemented here, and he also used the feedback. I feel like were making Real Progress with him. Ethan so, on the way back from kenosha, jules and i racked up a list of potential addons to the word smith. We kind of did some explorations around color and logos. I really like the camp thing. I think that turned out really well. We just came up with what symbolizes each thing. Lemonis love the fact that you put a lot of thought into it. And i think its important that the customer understand every product they buy from this company has a lot of technical thought behind it. Its where technical thought meets adventure. Ethan i love it. Lemonis so, i would start to say lets build the 500 rafts, and i would say, give em to me as fast as you can. Ethan but then we need the building across the street. Lemonis enough with the building. I thought we had already dealt with this. I am concerned about the building. I told you how i felt about it. Ethan i mean, from an equity standpoint, if you can have a piece of property that could potentially be worth 5 million, people, banks, especially, they like to have collateral. Lemonis why do you need a bank to have ethan well, we dont now cause youre here. Thats well i mean, what im saying is, i see it as this potential that we could grow into. We could spend 20 years there and still have a great business. 100 million business could be operating out of there. Lemonis but how do you know that . You dont have any numbers to support it. Jules we have been predominantly fly fishing, so the name is smithfly. Do you think that would be a problem . Kurt i dont think you should wrap yourself into one market segment. Ethan i see it as this potential just over 100 years ago woto vote in the united states. We can only reach the ballot box today because of those women who fought for our right. Honor their fight with your vote. Well. 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To see wait. Im sorry. What . Dont kids see enough violence as it is . Ive seen violence. Maybe we turn the word bundle into a character, like mr. Bundles. Top o the bundle to you. [ laughter ] bundle, bundle, bundle. My kids would love that. Yeah. Bundle, bundle, bundle. That we could grow into. We could spend 20 years there and still have a great business. 100 million business could be operating out of there. Lemonis but how do you know that . You dont have any numbers to support it. You also could have 100 million business in this building right here. I dont want you to think im saying, no dreams and no growth. Im just saying, can we just sell a jacket first . Ethan [ laughs ] thats a great place to start. Lemonis because you got an order, and you had actually to return somebodys money. Ethan right. Lemonis lets solve that problem. I need ethan to understand that designing new products, selling products, finding new customers, these basic small problems, if theyre solved, will lead you to become a big business. You dont do those things, youre out of business. Its necessity to make smithfly successful is where im having a hard time connecting that dot. Ethan i mean, i think youre right. I agree. Lemonis sound good . Jules sounds great. Lemonis you feel okay . Ethan yeah. Lemonis ethan is concerned about needing more space as the business continues to grow, but in order to accommodate that growth, you dont have to actually just get bigger yourself, you can find Strategic Partners you can get help from. And so, im taking them to miami to rocket trailers, a company that understands the marine space and, quite frankly, can build any trailer for any size product. Mario whatever you want custom, you can get done. Ethan uh, well, for me and what, you know, i like to do, is just innovate and change things quickly and work on things, like, right there. Mario instead of doing things and messing up and doing em over again, well do the messing up and youll get the product you want. Mike which allows you to work on your innovation. Leave the trailer manufactures to the trailer people. Lemonis how much did the trailer that you make at home in ohio weigh, and what does it cost . Ethan it weighs about 400 pounds, and it costs us about 2,000 bucks. Lemonis to make. Ethan to make, yeah. Lemonis what does this weigh . Frank this one weighs around 4 1 4. Lemonis okay. So, pretty close. Ethan pretty close, yep. Frank and then the retail price in this one is 1,395. Lemonis the retail price . Ethan yeah. Lemonis so, what would you sell this to a dealer for . Frank a dealer, we sell it at 10 off. Lemonis its half the price. Ethan yeah. Lemonis you can see that the quality of the rocket trailers is infinitely better than what ethan was doing. And thats no criticism of him. Its just not his core competency. If you think this is a good quality. Ethan yeah, i think it matches, and its what were looking for. Lemonis it matches your brand. Ethan yeah, yeah, i think so. I think its a good fit. Lemonis hi, guys. Nice to see you again, brother. How are you . Ethan how you doing . Lemonis this is ethan and jules. Ethan and jules keep telling me that theres a lot of International Demand for this product. And its not that i dont believe them, but i want to validate that. So, im taking them to cala marine. Its a distributor that focuses on most of south america, latin america, and the islands. And i want to hear their feedback if jules and ethan are actually on the right path. Jules okay. So, one of the things that has made this the raft that Everyone Wants is the weight. Its superlight. The bottom has little holes so that the water selfbails. Ethan and it floats in nexttono water, so were talking inches of water. Ethan we did a version of it that were calling the palapa raft. Mike whats the Weight Capacity . Ethan we say about 1,200 pounds, but the hull design should float more like 4,000. Jules its the same class as the raft, so its superdurable. Mike whats the weight on it . Ethan uh, its about 75, 80 pounds right now. Mike thats heavy. Kurt if you could lighten this up for Emergency Response market by using a thinner fabric. Ethan thinner fabric, smaller tubes all the way around. Thatd be cool. Lemonis allinall, you guys think this is a decent idea . All yeah. Lemonis the two of them are doing an infinitely better job of presenting the company and its products than they did back at gander. I feel like jules feels more comfortable in her environment, and ethan is allowing people to give feedback, and hes not defensive every time they say something. Ethan this is our rain jacket that we developed that has lasercut panels up here that allow you to put whatever tools youre going to use. I think we can really sell the pants off of those. Marcos i was going to say, chile, i think its going to be very interesting. Ethan mmhmm. Marcos you guys planning to have a catalog with full line of products and Everything Else . Lemonis when will we see that . Jules well, i would say that we we havent moved ahead on some of these things, just because of name, you know, looking at. Ethan just finalizing things, finalfinal. Jules . You know, what thats going to be. Lemonis did you guys just hear ethan and jules tell the team at cala that the name hasnt been finalized, because, in my mind, it has. If jules and ethan arent fully sold on this umbrella name change idea, it probably wouldve been a good idea for them to bring that up outside of this environment. Jules we have been predominantly fly fishing, so the name is smithfly. You think that would be, um, a problem to keep as smithfly on products . Would that be confusing . Rob as far as like, in the islands, theres not much fly fishing going on. Lionel fly fishing in the fishing market, its a small, small market. We talking maybe 3 . Kurt i dont think you should wrap yourself into one market segment. Lemonis if your business is in trouble and you and need my help, log on to theprofitcasting. Com. Lionel fly fishing in the fishing market, paul do you get confused by i dont blame you,laims . The most reliable, the most awarded. The best, the fastest, the best and the fastest. Enough. Sprint is doing things differently. Theyre offering a 100 total satisfaction guarantee. So you can try out the network and see the savings for yourself. And now, get the new Samsung Galaxy s20 5g for just 0 a month. Its 5g ready for people with hearing loss, visit sprintrelay. Com. I wrote this a long time ago. I dont know how old i was. I hope someday i will be on a real football team. Im katie sowers, offensive assistant coach for the San Francisco 49ers. Im not just here to be the token female, im here to help us win. The surface pro helps me get whats in my head and get it out on to the field. I would want to tell this little girl to keep pushing herself, your dreams coming. He spent his life bringing people together. I know hed be happy that we are all together now. crying what is happening . [what is that . ] baby noises is that a baby nut . baby noises dolphin noises just kidding, im back. Wheres my monocle . You can enjoy the seafood you love from the comfort of home. If it ever makes it there. Spend 30 and get free delivery at red lobster dot com. I need to follow my heart. I know im not the smartest, or the fastest. Im going with frankie z. Jake from state farm . Heres the deal. Shes not the one for you. Sure, shes got that cool apartment, that brand new car, but she doesnt have good insurance. If shes not going to protect all her stuff with state farm, hows she going to protect your heart . You want the real deal. Like a good neighbor, state farm is there. ® you want the real deal. Its a small, small market. We talking maybe 3 . Kurt i dont think you should wrap yourself into one market segment. Lemonis i dont want to alienate hunters or regular fishermen. So, they went back to the drawing board, and they came up with different ways for his company to exist. These are the name options. Youll see one of them is smithfly. What we said is, lets call the Holding Company something different, and you would have these different rob right, different brands. Lemonis you would have smithfly, smithgear, smithwater. Rob i saw smithtech, which i liked, because its telling people that this is not only a technical, but an innovative company. Lemonis well come back to you with the catalog, hoping that you guys can rep us in that part of the world. Well, guys, thank you so much. Ralph thank you, marc. Lemonis thanks, ralph. Thank you, sir. Luckily, we were able to get everybodys head right about it. But what i dont like is surprises like that, especially in front of a potential distributor. So, the part that i didnt think went well, was your comment about, were waiting to figure out the branding. Jules okay. Lemonis okay. When i left last time, i thought, hey, were all in lockstep, but it sounds like the three of us are not in lockstep about it. Jules weve already made the name as smithfly, so people know us for all of these things. Lemonis the business that brought you to the dance, smithfly, is not going away. Its just inviting other people to the party. Ethan its not necessarily a terrible idea. Its good. Lemonis its good that its not terrible. I set up a meeting for the end of this month. And were going to go the headquarters for realtree. We want to create a licensing relationship with them, where we have the rights to use their very popular prints and fabrics across the boats, the tents, the apparel, and were going to let jules take the lead. So, lets get prepared for that. Jules okay. Ethan sounds good. Lemonis all right. Talk to you later. Ethan yep. Lemonis thanks, guys. Realtree is the company that specializes in camo prints for the outdoor lifestyle. Its almost like getting the Good Housekeeping seal of approval on one of your products. Lets go jules oh, look what hes got on lemonis were ready ethan hey, look at that jules hey, nice. Lemonis were here on a pitch. Weve got to be dressed with our stuff, right . If the camo print is part of or connected to that product and it has realtree on it, retailers almost see that as a big check to put it in their stores. So, what do you guys have set up here . Jules yeah, so we brought a little bit of of everything. Lemonis so, what is this print . Jules that is a realtree knockoff. Ethan no, its thats the real deal. Yeah. Jules oh, it is. Lemonis this is recent, just made. Ethan mmhmm. Pretty recently. Lemonis it looks good. Ethan yeah, so thats all the new features. Lemonis what size is this . Jules your size. Ethan i believe thats a large. Jules it looks good. Lemonis hold on a second. Can you see me now . So, how are you going to explain your appetite for realtree . What is your pitch . Well, more importantly, what is yopitch . Jules no, its not my pitch, its his pitch. He did it. Lemonis well, i thought you were doing it. Jules well, ethan did it. Ethan were a team. She, you know, was talking to the customers and doing other stuff. I didnt want to burden her with that or take her away. So we got to divide and conquer a little bit. Thats the way i look at it. Lemonis i have zero doubt in your ability to be creative, but in order to move forward, right, if this business isnt going to be a oneman band, you do have to lean on people a little bit more. So, lets divide and communicate, not divide and conquer. Ethan sure. Lemonis do you want to head up . Ethan sure. Absolutely. Lemonis oh, my gosh. Jules wow. Lemonis this place is awesome. Bill bill jordan. Jules hi. Hi, bill. Im jules. Very nice to meet you. Lemonis im annoyed at the fact that ethan put this entire presentation together without involving jules. Shes the one that is going to lead the sales organization. I dont know why he would do that. And candidly, if we dont secure the licensing deal, im going to question whether my investment makes sense or not. Ethan so, we started pretty small, and we started in that niche market of fly fishing because it was something i could wrap my brain around. So we basically took that military concept and designed a set of pouches for fly fishermen so they could configure their own gear. Brian do you have any kind of design patent on that . Ethan patents in apparel are very difficult, cause they change one thing and its different. So, thats kind of where we started in 2011, and then we expanded. Instead of picking up the normal inflatables that were out there, i designed my own, cause there just wasnt what i was happy with, out there. So, i found a good inflatable manufacturer. A friend of mine approached me about making a raft cause my inflatable supplier made rafts. So, he said, could we make a raft . And i said, sure, well do that. Brian what is the target market there . You know, from a first glance, you think, what is a tent on water . Bill you almost need to break down each market. You know, fishing, hunting, and see how it fits. Ethan no, thats more like a party cove, kind of beer drinking platform. Lemonis any feedback that people gave, ethan was somewhat dismissive about it. Im standing here watching the realtree folks, and you could tell that they almost cant wait for the meeting to be over. Ethan wed love to bring Something Back to you guys and not just be a licensee, if possible. Lemonis before we jump into that, can we take a twosecond timeout . Can you guys just give us a minute . Lets huddle over here for a second. burke weve seen almost everything, so we know how to cover almost anything. Even a gold medal grizzly. sports announcer what an unlikely field in this final heat. burke not exactly a skinny dipper, but we covered it. At farmers, we know a thing or two because weve seen a thing or two. So call 1800 farmers to get a quote. We are farmers. Bumpadum, bumbumbumbum woman no matter what business you are in, Digital Transformation never stops. Verizon keeps business ready for whats next. man we weave security into their business. second man virtualize their operations. third man and could even build ai into their customer experiences. We also keep them ready for the next big opportunity. Like 5g. woman where machines could talk to each other and expertise could go anywhere. woman when it comes to Digital Transformation, verizon keeps business ready. [ fastpaced drumming ] lemonis heres the numberone tip when you go into a presentation. Know your audience, and go in there excited to talk about them, get them engaged and get their feedback. Jules were really excited to be here, cause i know a little bit of your story. When you were going to that first show. Bill mmhmm. Jules and that you only had what you had in the booth that day and how walmart and bass pro came in and really, uh, partnered and helped you and developed relationships and that type of thing. Those are the things that were looking at, working with marcus, and then also working with you, so were excited to be here today. Bill we are, too. Glad to have you guys down. Lemonis i love the fact that jules did her research and that she opened up with the founder of realtree, creating this relatability about realtrees history. I could watch his engagement elevate instantly. Man oh, dang. Jules you can even stand up inside. Bill its stable. Man yeah, yeah. Jules yeah, its a dropstitch floor, so its got that taut when its inflated all the way. Brian when you show this on a presentation, were all sitting there thinking, what is the use of that . Bill right. Brian when you actually physically see it, feel it, touch it, it changes your perspective. Lemonis and with jules taking over, you can tell that she set the tempo perfectly. Jules this is our wader jacket. Brian tell you, its some goodlooking stuff. Man yeah, i love this. Lemonis shes engaging with them, shes having them try the products. Shes not overtalking them, and shes listening. Brian thats a highend jacket. Its got welded seams. You know, the zippers are sealed zippers. I mean, its very wellmade. Its a good product. Jules so, bill, what do you think . Bill of course, thats a natural. Jules right . Bill i think that right there has just, uh, got a lot of possibilities. Jules yeah, i think so, too. So, uh so, like, we can do some business . Bill yes. For you. Jules [ laughs ] lemonis glad were going to do some business together. Bill i am, too. Lemonis thank you very much. Bill im glad you come down. Im really glad you came down. Lemonis thank you so much. Bill pleasure to meet you. Bill thank you for coming down. Jules yes. Lemonis i thought you guys did good today. And you were really good at warming them up. The two of you were talking, he was getting more comfortable. And i like the fact that she went in for the ask. And you went into the right person because he fell in love with the product. Jules yes. Lemonis so, they love this. Jules yeah. Ethan its fun. Jules well, who doesnt love it . Yeah, once youre in lemonis so, lets say that you only sell 1,000 of these next year. Okay, so how much is two a day . Ethan its 1. 9 million if we do lemonis and then if you do 1,000 of those, how much is that . Ethan yeah, thats 3. 4 million. Lemonis so, how much is that in total revenue . Ethan its like 5. 5 million. Lemonis selling two products, being very focused and having really good partners. Jules amazing. Ethan yeah, its tremendous. Lemonis okay. In order for this company to be successful, it doesnt have to hit a grand slam. It can hit singles and doubles. And ultimately selling 1,000 rafts a year, its not a stretch. This company could easily do 5 million in the next year. And the margins are good enough that this could be a very profitable business. Lets just take it slow and make good money. Anything for me . Jules anything for you . This is what i have for you. Lemonis i think ethan learned that hes got to be a better listener, he has to incorporate jules. If he can match up his skills with other peoples feedback, hes unstoppable. Okay . Jules yeah. Lemonis all right, lets get cleaned up. Jules awesome. Lemonis get out of here. Man where is it . Man 2 go grab it. Go. Amber here i am speaker were rolling. Man rolling. Speed. Lemonis tonight, were gonna give you an inside look at an episode from season 3 . Amber yeah. Lemonis season 3. Its grafton furniture, in my hometown of miami. Now its in miami. Amber your hometown of hialeah. Lemonis its on the border of hialeah and miami. But part of the reason why i wanted to come back to miami is that i wanted to really invest in a Small Business here, in south florida, because of what this community had done for me and what i felt like i could give back to it. And, when the grafton family applied as a multigenerational business, and we know that, more often than not, these multigenerational businesses fail. Melissa okay, yes. There are always arguments