Transcripts For CNBC The Profit 20240713

There are always little fireball moments. Stevie boom, boom, boom. Lets set the stage, baby. Lemonis in the last seven years of doing the profit, ive visited nearly 100 businesses. Lets go make some money. [ horn honking ] ive traveled the country trying to fix the people. And you do 1 million a year. You should be proud of it. Man but we dont know how to keep any of it. Lemonis . Fix the process. See . It is flimsy. Dont ever make these again. You dont sell them. And create a few products. Woman it reduces anxiety and depression. Lemonis i kinda like it. I spend countless days working on these companies. Man [laughs] lemonis how much money did you burn through . Man 650,000. Lemonis but we cant always fit everything im thinking into the show. [ musical powerdown ] so, tonight, were gonna give you an inside look at a business from season 3 grafton furniture. Over the next hour, im gonna take you behind the scenes to find out how a struggling Custom Furniture company. And what is it worth with this nick . Stevie nothing. Lemonis what else do you wanna show me . cause im really excited to buy furniture here. Amber what was marcus thinking when he walked in . Stevie what is all this garbage here . Amber not garbage lemonis . Run by headstrong business owners. Stevie which really should be his job. Lemonis have you assigned him that job . Stevie no. Lemonis then how is he supposed to know that . [ laughter ]. Completely transform their business. Effective today, steven is 100 in charge of the quality and im gonna get him yellow stickers and, if it doesnt have the dot, it doesnt go out. And their family. Stevie congratulations. Esteban you did it. You did it. Lemonis . And left a lasting impression on me. One of the most honest guys ive ever worked with stevie yeah. Lemonis and the most creative person that i know. Stevie wow. Amber wow. Lemonis those two things. My name is marcus lemonis, and this is an inside look at the profit. [ bell ringing ] woman okay, guys. Were rolling. Amber so the whole family is gonna work in the business . Stevie yes. Amber do you guys all do Something Different . Lemonis why dont you guys describe what you do for amber because i know what you do. Melissa im melissa and im in sales. Ryan im ryan. Im the operations manager. Matthew i am matthew. Im the youngest son, working logistics. Amber okay, so, and youre stevie. Stevie im stevie, yes. Amber . In case people forgot. Lemonis who can forget that face . Man aww. Amber i cant. But stevie was the only one of the kids in the original episode, right . Steve yeah, he was the only one on the episode. Ryan was working here at that time. Ryan i was parttime here, looking, actually, to leave the business and, with this show, i was brought back. Lemonis not because of the show. Thats not why you were brought back. You were brought back cause youre the only one that knows math. Amber so marcus wouldnt feel comfortable without you. Ryan yeah. Stevie hes really good at it. [ laughter ] hes good at it. Melissa hes the smart one. Lemonis why dont we watch the episode. [ latin music plays ] miami is my hometown and its oh, yeah. Also home to over a million cuban americans. They bring their culture while embracing the american dream. Grafton furniture is a shining example. [ camera shutter clicking ] started in 1964 by esteban grafton. His son steve now runs the business and designs most of the furniture. Amber steve, that shirt. [laughing] mary he threw it away. Its gone. Lemonis . And is 50 50 partners with his wife, mary. Their son, also steve, is there to learn the business and keep it going for another generation. But, without some dramatic changes, [ suspenseful music plays ] the future of this business is in serious doubt. [ clang ] [ whimsical tune plays ] my First Impression of grafton furniture is that i like what i see. I like the look and feel of the place. Amber you look so different. Lemonis how are you doing . Steve marcus. Lemonis how are you . Steve im great. Lemonis are you steven . Steve im Steve Grafton. Lemonis nice to meet you. I was just trying out some of your furniture. Steve nice. Lemonis who do you primarily make your furniture for . Steve interior designers. Lemonis and so, a customer cannot come here and buy this stuff . Steve this is stuff that ive had from years ago, and i just put this showroom together over the last 6 to 9 months. And what i need is to merchandise this with current inventory that we sell today. Lemonis why do you laugh, stevie . Stevie now i know exactly what you were thinking. Its funny. Amber what was marcus thinking when he walked in . Stevie why all this . What is all this garbage here . Amber not garbage. Stevie no, but, like, older things that are clearly not things were trying to sell. Theyre just over the years still have. Amber but this was also 5 years in all fairness, this was five years ago, so styles have changed. Were you thinking. Lemonis what did it have to do with collecting a bunch of crap in a room . Mary and add stains and chips on it. Steve it was a beautiful showroom. I wish i had most of that stuff today. Lemonis so, this is essentially a showroom that has furniture that you cant buy. Theyre a custom manufacturer, so this warehouse is not a showroom. Its just a bunch of unclaimed furniture. Can you buy it . Could you buy it . Steve yeah. Mary yeah. Stevie unless its screwed to the ground, Steve Grafton would sell. Steve absolutely. Mary he sold stuff right out of our house. Lemonis out of your house . Steve yeah. Mary everything is for sale. Lemonis that doesnt include your kids, does it . Steve well. No. Lemonis hit play. How long have you been in this building . Steve since 1964. Lemonis well, i mean. Steve 50 years. Steve my dad. Lemonis oh, your dad. Okay. Steve hes here actually. Lemonis i would love to meet him. Steve i would love for you to meet him. Papa. Esteban hey. Lemonis how are you doing, sir . Esteban so far, so good. Lemonis your name . Esteban esteban grafton. Lemonis nice to meet you, sir. Esteban nice to meet you. Lemonis wow. Esteban well, ive been here since 1953, and im an american. Lemonis pause. Do you miss your dad . Steve yes. I do. Lemonis he had a presence, for sure. Steve oh, yeah. Amber for people that didnt watch our recap, we should say that your father passed away. Steve actually, the day after the show aired. Mary he watched it in the hospital. Steve yeah, he watched it in the hospital. Lemonis he was happy with it, though. Steve oh, yes. He felt great where we were, and where we were going. Lemonis and so, youre the true american success story. Steve they call him maestro around here. Lemonis maestro. You come to work every day . Esteban most of the time. Lemonis you in your sixties . Esteban im 82. Lemonis 82. Steve this is steven. Lemonis how are you . Im marcus. Stevie nice to meet you, marcus. Lemonis youre steven also . Stevie yeah, its a terrible story really. Steve im steve. Hes steven. Hes esteban. Lemonis okay. So, three generations right here. Generational businesses often struggle. We know that second generational business fail at about a 60 rate, and we know that its even worse for third generational businesses that fail at almost 90 . How is it working for your dad . Stevie its great and stressful. Amber so, multigenerational businesses dont ever last . Lemonis usually, what happens is, when the founder starts a business, they have a reason for starting the business, and its more than just financial. They are trying to solve a problem. Theres some interest that they have in it. And i think that theres this misnomer that multigenerational businesses fail because the kids or the grandkids are bad, or theyre not smart, but the reality of it is that, they dont necessarily do well because theyre just not interested in it. Amber are you guys interested in it, or do you feel like you have to do it . Stevie yeah, definitely interested. Melissa very interested. I think because we grew up here, who the graftons are is grafton furniture. Amber thats nice to see. Lemonis grafton has a crew of 28 employees. They do everything from design, build, paint, and upholster. Louis what you need to do is do it multiple times, cause you can see the difference, how this is smoother, and this is still rough. Lemonis so, why doesnt that machine do it all in one . Louis cause its not, like, one of the best planers. Lemonis do they make one that would do it all in one shot . Louis yes. Lemonis what does it cost to get a brandnew one that does it the right way . Louis a really good one, about, say, 3,000. Lemonis if it costs 3,000 to get a new one, how much time extra did he have to take to do it three times, multiplied times the number of furniture that we make in a year . How long does it take me to get my money back . Steve is looking at me like, what . Steve how the [bleep] am i gonna figure that out . This is the house in the hamptons, and here are the sales orders, here. Lemonis what kind of margin do we have on this, decent margin . Steve i think so. Lemonis you think so . Steve yes. Because you dont know until you make it. Lemonis you dont know what your margins are on them. You kind of go into production with just a guess. Steve correct. An educated guess. [ laughter ] amber pause. Now, you watched every show. A lot of shows. Steve yes. Amber so you had to have known that he was gonna call you out on numbers and margins. Steve listen, in manufacturing, labor could have a bad day. Yeah, i know how long it takes to make a dining chair, but sometimes, the guy might. Amber okay, you dont have to get so angry. Louis this is what we call a master list. This is everything that we have inhouse. Lemonis why are all the wips zero . Steve cause they havent they dont put the wips into here. Lemonis why wouldnt you update this . This is nothing, then. Steve correct. Lemonis why wouldnt i know the status of a job . Steve this is our bible. Lemonis well, you need to go to a different church. In any manufacturing business, the most important document is the workinprocess report. It tells you where jobs are in their life cycle. So, if you had 10 jobs happening at one time, you would know if a job was 7 done, 87 done, or 100 done. At grafton, i dont have anything filled out. Theyre all zeros, so i dont know what the hell is happening. It could be me, but tell me what you see when you look down the barrel. Do you see a swell . Steve a swell right here. Lemonis you see a swell on one side . If this came to my house, id send it back. Steve is like, [bleep]. What did we sign up for . Amber yeah, i know. Lemonis how are you doing . Jorge how are you doing, sir . Lemonis im marcus. Jorge im jorge castellanos. Lemonis what is your job here . Jorge i do delivery and. Steve ah, here we go, payroll guy. Lemonis you do payroll, too . Jorge yeah. Lemonis which is very common, that the same person that does payroll does deliveries and installation. Right . Stevie its just too easy for you. Lemonis its very common. Steve he doesnt do payroll. Stevie yeah, he does. Lemonis you say no. He says yes. He says yes. You said he doesnt help with payroll . Steve no, he helps her. He prints out all the time sheets, and he goes to them, what job were you working on . Which really should be his job. Amber yes. Stevie he made him so happy by saying that. Lemonis have you assigned him that job . Steve no. Lemonis so, then, why do you say it should be his job . Steve because thats one thing that he should be doing to help this. Lemonis but how is he supposed to know that . Is he supposed to read your mind . Stevie yeah. Here, yeah. Steve all of these products, these are orders to be done. Lemonis its not very clear what the process is. Its not easy to follow. Louis it is for me cause ive been doing it for so long. And thats why i have stevie to help me. Stevie im not comfortable because im not sure that this is the actual order, because something changes, and its all these two when they talk to clients, and then it stays in their heads. It could have been changed. It could have been something they talked about. And they know. Lemonis theres not a change order process. Steve yes, there is. Louis theres no official. Steve there is. Esteban sometime, it doesnt happen. Steve right, because hes being jumped over all the time. Lemonis well, cause he doesnt have a clear role, and youre making changes, and youre not bringing him into the loop. Would his role exist if he wasnt your son . Steve yes. Assistant production manager. Lemonis if hes out, is he in charge . Steve hes in charge if hes out. Lemonis Everybody Knows that . Steve i would hope so. Lemonis louis, is that true . Louis it will be stevie to a point, but theyre gonna go to steve. Lemonis and so, its the worst position you could put him in is when you give somebody a title, but you dont actually give him the stick. Whos in charge of quality here . Stevie i would be more in charge of quality. Lemonis cause what i think what happens is, when you know that you need to collect the money, you start cutting corners to get it done faster. Steve right. Stevie i dont want to do that. And i think if were not gonna get it checked cause were late, you know, i understand the business. You got to get the money, but i know what a good product looks like. Lemonis well, at the end of the day, here is how you should think about this. This is your grandfather was here. Now your father is here. And if you dont get the quality right, this business wont be here for you. Stevie exactly. Thats my lemonis its got your name on it. Stevie exactly. Lemonis whos in charge of quality today . You are . And so, have you now been given the yellow dot tshirt . Amber you cant just randomly put dots on people. You have to explain what the dots are. We all have a dot, and youre. Lemonis tell everybody what it is. Steve the yellow dot is when the final stage of production gives it the thumbsup, and its ready to ship. Lemonis do you still use them today . Be honest. Steve no. Lemonis thats good to know. Amber oh, so we dont have to wear this . Steve no. Amber forget it. No yellow dots. Stevie the spirit of the yellow dot lives on, so theres a different vehicle now. Now, theres approval stamps, and things like that. But everybody. Lemonis you mean its legit now . Melissa yeah. Lemonis theres 1 million in debt, not enough working capital. Fixing up machinery in the building, thats 1. 3 million. Steve correct. Amber you heard 1 million in debt. Why didnt you run . Lemonis did you guys bring the application tape . I wanted to show them the casting. Amber we did bring the tape. And im gonna embarrass them a little bit because as producers, we tell them that when we shoot their skype, we tell them that no one is ever gonna see it. Mary thats exactly what i remember hearing. Lemonis were violating that rule tonight. Amber we are, because when i said that, we didnt have this show. So, it wasnt really a lie back then. Steve oh, my god. This is esteban grafton. Esteban esteban grafton. How do i look . Old . Lemonis you look great, buddy. Steve my dad started it, and my son is, hopefully, gonna be the third generation. Im always catching things that are being done wrong, and so, ill say, no, no, no, this is what i want. And then, hell come in and say, well, if you freaking write it on the order the right way, maybe we would know what were doing, and dad, see. It gets spicy here. Dont you worry. Mary thats the problem. Stevie sometimes, well just be out there, and well look at one piece of information that we have, not knowing something that he might have kept in the back of his mind during a conversation Little Things like that. Matthew i just want to make sure this company can be all it. Oh, my god. That sounds so cheesy, but i want it to be all it can be. You know, i think we could be a lot better than we are. Lemonis when you see that, what do you think to yourself . Matthew i love my family. Lemonis what do you love about them . Matthew i love how real everybody is, and that we enjoy this life that we have together. Amber thats such a good answer. Lemonis hes the heart. Amber thats why we picked your family, too, by the way, because we loved your family. Its a real family, real stakes, real business. Which one of you actually applied to the profit . Mary i did. Lemonis i didnt know that. Amber oh, i didnt know that. Mary well, he always watched it. And i would see him in the living room watching it, and id say, oh, not this again. Lemonis thanks, mary. [ laughter ] mary sorry. And i said, im just going to apply. Nothing is gonna happen from it. And i told them all. Steve i knew it was gonna happen. Lemonis why . Steve i dont know. I just felt it. And when i researched that you were from miami, i knew that you wanted to come back to miami. Lemonis the miami thing helped. Steve mary is like, oh, nothing is gonna happen. And by her doubting it, i knew even more it was happening. Lemonis total revenue last year 2,448,000. Gross profit at 1,000,000, so less than 50 . Steve yeah. And thats lemonis you said the margins were amazing. Amazing at under 50 . Is that considered amazing . Steve no. Lemonis the Industry Standard on Custom Furniture margins is around 70 . Grafton furniture is operating at about 50 . We have a lot of work to do to figure out where the 20 is leaking out. The total liabilities that should be on my mind are 369,000 in thirdparty debt, 600,000 on the mortgage for the building, and 50,000 in a liability to the other shareholder of the property, which happens to be your brother. Steve correct. Lemonis and so, its about 1,000,000. Steve correct. Lemonis its a summary of all of it. Lemonis that would clean up every piece of debt. Steve every single one. Lemonis okay. So, i think about this business in three distinct categories quick ship, mass market, fast production, turn it over and go, semicustom, where theres a couple of styles, and you could pick your wood finish and your fabrics and then custom. Mary thats what we are. I just feel like were custom and high end, and i kind of want to stay that. Lemonis alright. Im gonna take some time to just kind of look at this. Steve okay. Lemonis ill see you in a little bit. Steve okay. Lemonis thank you. Steve thanks, marcus. Lemonis steve is like, what did i get myself into . Steve [bleep] amber look at you, marcus. Lemonis whats up with the beige suit . Amber all miamied out. Lemonis today, im meeting the graftons at one of my favorite restaurants in miami. It was a big deal for us to shoot there. Remember, you and i were pretty jacked out. Steve i know. Lemonis do you feel like your business is run right today . Esteban no. Lemonis your dad said no pretty quick, didnt he . Steve well, no. Theres always room for improvement. Lemonis i get the sense, based on a few things yesterday, that you feel like youre the only one with good ideas. Steve you have to convince me of what youre asking, or doing, or saying. And if i think its totally wrong, ill tell you my opinion. Lemonis what happens if steven gives you his opinion . Do you process that, or do you dismiss it early . Steve no, i process it. I do dismiss it often. Lemonis look how cute he is there. Melissa i know. Adorable. Amber he looks like a baby. Lemonis are you confused, sometimes, when you come in, what your role is . Stevie yes. Yeah. Lemonis so, when i think about your financials, theres 1 million in debt, not enough working capital to sustain any sort of downturn. Fixing up machinery in the buildings, thats 1. 3 million. Steve correct. Lemonis so. Im willing to put up 1. 5 million. Thats a lot of money. Mary you didnt even blink. Lemonis right . Stevie absolutely. Lemonis and so for the 1. 5 million, i would want 45 of the business. Stevie is like, what . Full financial control. And i want to be able to have 100 say on his path without any question from you. Amber you heard 1 million in debt. Why didnt you run . Lemonis well, because i knew there were assets here that supported it. And if the business does 2. 5 million a year, even if the margins are 40 , they werent that far away from being able to solve it. Amber okay. Lemonis i knew this building was here, and i knew it was somewhere in the equation. And i didnt want to bring it up initially, but that was really the asset, here. Right . I mean, we just cut to the chase about it. There is one more twist to it. You have to be able to retail it for under 500, and make a 50 margin. Mary never. Lemonis if youre looking to take your business to the next level, log on to theprofitcasting. Com. Amber you guys even have, i heard, dealing with our finances really haunted me. Ttle cranky. Thankfully, i got quickbooks, and a live bookkeepers helping customize it for our business. live bookkeeper youre all set up janine great vo get set up right with a live bookkeeper with intuit quickbooks. Family meetings, now, right . Ryan actually, we do. Amber tell me about that. Ryan steve will talk about the balance sheet, and about profit and loss, and well talk about margins, and, you know, we all learn, and get a better sense of business in general. Amber thats great. Ryan yeah. Matthew i like to make sure that everybody is communicating. I like to facilitate communication a smiling face somebody will listen to. I just try and learn everything as i can. Stevie his answers are just. Perfect. Amber whats the age difference between you two . Stevie 10 years. Amber that makes sense. Stevie but i guess my maturity level is on, you know, 21 yearold level. I dont know. Lemonis and so, for the 1. 5 million, i would want 45 of the business and 100 say on his path without any question from you. Mary i think im gonna cry. Lemonis does that help, mary . Mary yeah. Absolutely. When banks turn you down, and when people turn their heads on you, to know that somebody with your knowledge and experience believe in us, and my son. Youre taking him under your wing. Im ecstatic. Lemonis we have a deal . Mary are we supposed to do a round of applause now . Lemonis thank you. Steve thank you. Lemonis im looking forward to it. Steve god bless you. Lemonis you alright . You got pit stains cause youre so nervous. Stevie yeah, a little a warm in here. Lemonis its not that warm in here. I think youre just [bleep] your pants. Stevie yeah, i am. Amber how are you feeling right now when you see this, when you see this again . Mary it was horrible not being able to pay your bills, and having your cars repossessed, and, like, all that. Its awful and it was like a dream, though. It was like, you know, somebody coming in, and believing in us, and willing to, you know, help us out. Lemonis i told you that i wanted to figure out a way to build the line, and so, what id like to do is id like to start with creating a quickship product designed solely by you. My goal in driving graftons revenue is to create a quickship line. These are readytobuy lines with multiple designs, and theyre offered up with a few wood choices and few fabric selections. And unlike Custom Furniture, these pieces can be in your home within 10 to 14 days. Id like to start with four accent chairs. I want you to design all four chairs with a different look in mind. There is one more twist to it. You have to be able to retail it for under 500 and make a 50 margin. Steve thats doable. Mary never. Lemonis and i knew that. Pause. I knew that it wasnt possible, but i needed you get you guys to stop thinking that every chair had to be 1,000, 2,000. What i was trying to prove in that model is where the efficiency breakdown was that exploited the fact that you couldnt get your cost there and whether you had gotten it to 500 cost, and retailed it for 995, that wasnt as important to me as you understanding the labor and the materials that it took to make something, and the steps that it took to do it, and have you almost think about it like making a pot of soup. I need the base, i need the different ingredients, and what does it all cost . And there really was no process to know a chair has a specific amount of time with a specific amount of materials with a specific amount of labor. It didnt exist in this business at that point. Steve mmhmm. Thats true. Lemonis does it exist today . Steve it does. We have processes now. We have, you know, people looking at numbers. Theyre logging their hours. Were measuring all the labor and the materials that go into jobs. Lemonis steven so, going forward, we want to be able to understand better how we represent our quality. And so stevie yeah, i know. Back when i started doing deliveries and i would see unhappy clients and see mistakes maybe they wouldnt notice, butwould notice. Lemonis so is this an example of something that would get delivered . Steve mmhmm. Lemonis what would this chair retail for, brandnew . Steve brandnew, thats a 1,700 chair. Mary oh [ fabric ripping ] lemonis what do you see thats interesting about that cushion . Steve this shouldnt be seamed here. Lemonis why is it seamed there . Stevie it was seamed cause sometimes we make things work. Lemonis so this customer that paid 1,700 just happened to get, hey, sorry. We wanted to make it work, so were gonna give you a half literally, a halfass cushion. It covers half your ass. Steve right. This is not our best foot forward. Lemonis find a piece that you think is good. Steve this one we reupholstered recently. Lemonis how much would this chair retail for . Steve 1,000, or even a little bit more. Lemonis and what is it worth with this nick . Steve nothing. I had a customer tell me about this the other day. Lemonis what, he cut your chair . Steve no, they said, are you guys you making quality . It was like, we saw on the show you had a problem with quality. You were pissed. Lemonis i was annoyed. I was. I was actually annoyed. Amber why were you annoyed . Lemonis in my opinion, he let his ego drive the necessity of the show. And there was a little more to the story here. He had had a showroom in fort lauderdale, by the airport, and he was bruised when that showroom went away, and he tried to repair that by taking this warehouse and spending whatever amount of money it was to make it look prettier so he could make himself feel better. Steve its true. No, there is truth to that. Of course there is. Lemonis thats legitimately why i was a little fired up there, because i was thinking to myself, this is a guy who i think is wildly talented. I mean, what an amazing opportunity. And you were, by the way, equally as frustrated in that room, as well. Steve absolutely. Lemonis from what im understanding from him, youre not changing. Steve i think its getting better. Lemonis you can break my balls, but thats what i saw. Think you need to buy expensive skinCare Products lemonis what else do you wa[ ]to show me . To see dramatic results . Try olay skin care. Just one jar of microsculpting cream has the hydrating power of 5 jars of a prestige cream, which helps plump skin cells and visibly smooth wrinkles. While new olay retinol24. Provides visibly smoother, brighter skin. For dramatic skincare results, try olay. And now receive 25 off your purchase at olay. Com brand power. Helping you buy better. Did yocould be signs that syour digestive systemwn isnt working at its best . Taking metamucil every day can help. Metamucil supports your daily Digestive Health using a special plantbased fiber called psyllium. Psyllium works by forming a gel in your digestive system to trap and remove the waste that weighs you down. Metamucils gelling action also helps to lower cholesterol and slows sugar absorption to promote healthy blood sugar levels. So, start feeling lighter and more energetic. By taking metamucil every day. cause im really excited to buy furniture here in the showroom. Steve this one might pass muster. Lemonis oh, you have one that may pass muster . Thats good. That arm is on straight. Steve right. Lemonis this arm is on crooked. Steve right. Lemonis youre rushing it. Steven, is there anything in this showroom that you would deliver to a customer . Stevie no, theres nothing in here that i would give 100 . Lemonis who is really pushing the furniture out before its ready . Steve its a good customer, and they call, and they say, can you have it in less time . Stevie youll say yes, but then we have to do a rush. It messes up production. Lemonis does that frustrate you . Stevie everyone gets frustrated because theyre expected to do perfect in less than, you know, a perfect amount of time. Lemonis the problem with the furniture and the quality isnt the people that are making it. Its the process that theyre given to make it, or tlack of process. Going forward, effective today, steven is 100 in charge of the quality. And im gonna get him yellow stickers, like a little dot, and if it doesnt have the dot, it doesnt go out. Well just. You are now the yellow dot man. Amber pause. [ laughing ] are we giving out yellow dots again . Lemonis no, he is the yellow dot man. Also known as the marlboro man. [ laughter ] how much stuff in here is just not needed, dust all over it, and not efficient . The other major problem at grafton, well, its production. There is no flow. Ive got a great way to expand the Production Capacity without acquiring more land or more buildings. You can break my balls, but thats what i saw. Steve mmhmm. Lemonis we have this space that makes no money. And so were gonna clear it all out. Steve theyre gonna take my showroom away from me. Mary i told you when you were doing it. Steve killing me. Mary i told you. I did tell you. Lemonis were gonna improve the process by putting a flow in place, improving the number of mistakes that are made and making sure that when it goes out, it goes out right. Amber pause. You had a reaction, i feel like, just now like you were cleaning out again. [ laughs ] steve cause i saw a lot of things that i still like that were in there. Lemonis that was your reaction . Amber thats your reaction . Lemonis it wasnt to all the crap and how the warehouse looked . Steve yeah, it looked terrible. Amber what did you miss that he made you get rid of . Steve just. Lemonis everything . Steve yeah. Lemonis where did that end up going . Charity, right . Steve habitat . Yeah, charity. Stevie yeah. Lemonis so we did good for good people . Okay. Mary yeah. Amber any behindthescenes stories you could tell us of stuff that went away . Steve yeah, mary grabbed the desk that we had in the front. She grabbed me and said, you grab a couple things, and you put it in your car right now. And i was like, are you kidding me . Mary it was the desk. All i wanted was the desk. Amber whered the desk go . Mary im not even gonna tell you where the desk is. Stevie it wouldnt be production space, so its not important. Lemonis oh, okay. That was all you needed to say. Amber someonell need a desk. Lemonis play. If we want our product to be the best, we have to upgrade our equipment. We bought over 50,000 of new equipment, including a new sander, a new wood planer, two new table saws, and a dust collection system. Efficiency is labor. Labor is money. Money is margin. Thats whats gonna take this companys margins from 50 to 70 . Steve what happened with that silverleaf mirror . Stevie the paint came off. Steve well, this is the second time that mirror comes back. Stevie and itll come back again if we give them another quick date. We need to spend time on it. We cant give them quick turnaround days, because these things will just keep happening. Lemonis pause. Do they argue still today . Steve well argue sometimes, but very rarely. Im really happy now that theyre all here working harder than ever. We havent made it, but we are fulfilling a dream, which my dad had, as well. Lemonis are you frustrated a little . Stevie yeah, yeah. At times, im still like, come on, guys. Come on. Were still were doing the oldfashioned way, and i feel like sometimes they may think im just complaining to complain. Lemonis well, lets go talk to them. Steve continues to promise unrealistic delivery dates, and its affecting the business. So, we were just having this discussion about some issues that are bubbling up. From what im understanding from him, youre not changing. Steve i think its getting better. Its not going to get perfect right away. We have improved. Lemonis do you agree that thats happening . Stevie no. Lemonis the reason that i was pushing so hard was to force them to fix the process in the warehouse. This isnt this. Steve you dont like that . Lemonis i wouldve liked this, cause this is what i thought you were making. A lot of folks ask me why their dishwasher doesnt get everything clean. I tell them, it may be your detergent. Thats why more dishwasher brands recommend cascade platinum. With the soaking, scrubbing and rinsing built right in. For sparklingclean dishes, the first time. Cascade platinum. sensei a live bookkeeper quickbooks for me. Tomize live bookkeeper okay, youre all set up. sensei thanks that was my business gi, this ones casual. vo get set up right with a live bookkeeper with intuit quickbooks. Steve i think its getting better. Its not going to get perfect right away. We have improved. Lemonis do you agree that thats happening . Stevie no. Lemonis this is my favorite episode, i think. Amber this is mine. Lemonis maybe top three. And weve done over 100. Steve wow. I am starting to change. Yes, i am. Thats crazy. Its not gonna happen over night. Lemonis the biggest goal that i had was creating a succession plan. And having him feel like he doesnt have your support its not gonna help. Steve right. I promise ill try. Lemonis pause. Steve, what were you anxious about there . Stevie that day, i dont know. I think it was just tension, of, you know, the show, wanting to be right. I was still kind of unsure of things, so. Lemonis mmhmm. People get very frustrated in the first three or four days that im there because theyre like, why isnt stuff happening . Why isnt, like, the whole place totally redone by now . Not literally, but figuratively. Steve mmhmm. Amber and, to further that, they get frustrated when you leave and we dont know when youre coming back. Lemonis months. Sometimes there was a month where we didnt see you, i didnt see you. Steve right. Lemonis okay. Steve this is the prototype. Its getting ready to go into paint for tomorrow. Lemonis steves been working on the quickship furniture line, and hes ready to show me the first of four chairs. Steve this is what i didnt like about it. The arm is too low. Lemonis yeah. Feels like im struggling. Steve struggling to get down. Lemonis it also doesnt have the same pitch. This isnt this. Steve you dont like that . Lemonis i wouldve liked this, cause this is what i thought you were making. Its not exactly the way i want it. The numberone message that i want steve to understand is once we lock and load this design, i dont want him going back into the warehouse in the middle of the process and changing it. This seems offcenter to me now. Louis yeah, well have to change the pitch of this. Lemonis so, can we print this on a blueprint . Louis absolutely. Lemonis okay, and then well take it out in the shop and start the process. Amber so, this is a quickship line . Thats what thats supposed to be . Steve yes. Amber west elm does these models, and restoration hardware. Every furniture business seems to have quickship. Thats important, right . Lemonis yes, i mean, the quickship business that exists today is really a small line of chairs that you can get pretty easily. The reason that i was pushing quickship so hard was to force them to buy new machinery, fix the process in the warehouse, put an Inventory System in place. So, a lot of times, ill lead people down a path largely so that they fix their process in anticipation of Something Else. And if the Something Else happens or doesnt happen, its not as important as what you see here today, which is what i could consider a welloiled machine. Amber yeah. It looks awesome. Lemonis i want to see some stuff get cut. Well start the process by creating a template chair. The wood will get planed, then measured and cut to to size. So, we build a whole template for the whole chair . Steve correct. Lemonis okay. One time . Steve yes. Lemonis next, the parts and pieces will be assembled. Once i give my final stamp of approval, this will be the master template for all great lakes chairs. Well have a full line and be ready to sell them. Target price point . Steve 495. Lemonis cost . Steve 250. Well, i dont see yellow stickers. I see them on this, but i dont see them on these pieces. Stevie when its done, it has a sticker. Yikes. This doesnt have a sticker. Is it done . Steve no, its not done. Stevie okay, so let me do my thing. Lemonis how are you . Stevie im good. How you doing . Lemonis whats going on . Steve i was just making sure he had, you know, his eye on the ball and everything that needs to go out is checked. Lemonis i think he knows that, though, right . Stevie yeah. Lemonis is this. Are you now the yellow dot guy, as well . Steve no. [ laughter ] lemonis okay. Look how stressed he looks. You alright . Stevie yeah. Lemonis okay. Im sorry. Stevie no, its alright. Lemonis okay. Steve im sorry, too. Lemonis yeah, im sorry. Amber yeah, im sorry, too. I know. Lemonis i think you got to remember to stick to your thing. And youre bumping into other people, and hes your son, too. Steve oh, i know. I know. Lemonis and if we say were gonna give him authority and we say were gonna let him do his job. Steve mmhmm. Lemonis no . Steve yeah, no, youre right. Lemonis was it that way when you were growing up . Was it the same . Is your dad here . Steve yeah, my dads over there. Lemonis lets go talk to him about it, cause im trying to understand where your habit comes from. How you doing, my man . Esteban im in my office. Lemonis youre in your office . Esteban yes. [ chuckles ] how are you . Lemonis you know, im watching how him and stevie interact, and it seems like steven is always. On stevie. Esteban yes. Lemonis were you the same way with him . Esteban no. When he was that age, i step aside, and i let him to learn the business. Thats why he got to let steven learn to take charge for the next generation. Lemonis you just got to. Fresh start. Steve yes. Esteban thats progress. He can put. Lemonis its progress. Esteban yes, its progress. Lemonis okay, my man. Steve stevie. Stevie huh . Steve i know that theres a lot of pressure, and i know that ive been hard on you and ive been, you know, always riding you. And i want you to know that i am proud of you. Stevie no, no, i know. I know. Its cool. Nah, its. Steve you beat me here every morning, and youre hustling. Stevie yeah. Yeah. Steve okay . Stevie im glad you see it. [ steve smooches ] steve okay . Lemonis go ahead and turn around and take a look. Man oh, ohh lemonis you guys have helped me open up a lot of of stores all over the country, and i feel like its time to go big or go home. Embarrassed by hair loss or suffering from thinning hair . I didnt want to be judged because i was losin my hair. [announcer] welcome to hair club. Just really one of the best decisions ive ever made. I feel like me again. I have my dream hair back. Im glad i chose hair club. 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It will tell you what you need to know about your hair loss problem, what your options are, and its free when you call now. I just showed everybody what my hair looked like, and i got nothing but positive feedback and that i was an inspiration for other people. It just made it okay to do something about it. [announcer] call now to schedule your no obligation complimentary consultation. At your appointment, youll get a free comprehensive hair and scalp analysis. And as our gift to you, when you come in for your consultation, youll even receive a set of free hair Care Products especially formulated for women with thinning hair. Call or go online now. Dont wait another moment for that beautiful hair youve always wanted. My life is so much better since hair club. [announcer] call now. upbeat music lemonis hey, buddy. How are you . This total renovation cost me about 700,000. I spent 150,000 putting on a new roof that will last us for 15 years. I spent 75,000 putting air conditioning. I built out the employee lunch room, and i spent 110,000 building out a design center. The buildout will allow us to entirely change the process. The warehouse is gonna run like clockwork. Grafton had leakage of 20 of their profit margin because of inefficiencies. With the new equipment, thatll eliminate mistakes and doovers, and that will save 10 . The new efficient work flow will cut down on manpower hours, and that will save another 10 . Put those savings against a Million Dollars of revenue, and weve just added 200,000 in gross profit. Amber 700,000 . Thats a lot of money. Lemonis maybe more, right . Steve yeah, i think theres 800,000 in building improvement and machineries. Amber wow. Is this the most youve spent on a renovation, 800,000 . Lemonis at that point in time, yeah. And steve and i had a bone of contention between the two of us because he wanted more of the money, and i think mary did too, to go into the business as opposed to into the facility, and i felt like the foundation of the business needed to be right and the systems needed to be right, and the layout needed to be right. Amber and so at this point, have you made that money back that youve put into the building . Or how does that work . Steve well, the buildings have appreciated. At the time we did the deal there, i think they were worth 1. 5 million, Something Like that. Lemonis let me give you the exact numbers, cause i had them appraised just so i knew i was good. Steve oh, okay. Lemonis 1,370,000 is what it appraised when we met, and the last appraisal was 2,820,000. Amber wow. Lemonis just to be specific. Amber wow. Steve okay. Lemonis were also in the final stages of looking for space for a new showroom in the miami design district. Pause. Okay, here is the deal. This is for real. Amber yes. Lemonis you know that you guys have helped me open up a lot of stores all over the country, and i feel like its time to go big or go home. We have talked about having a showroom in south florida. You find a place, well do it. Lets roll. Lets go. Melissa, youre on it. Melissa im ready. Amber season eight another episode. Find the location. Lemonis this, to me, is your business, your town, your family, because it started with you and its gonna go long after you. So go ahead and turn around and take a look. Steve oh, my god. Oh, my god. Lemonis theres your design center. Steve ohh look at that. Mary oh, wow. Look at that eagle. Oh, my god ryan look at these three guys. [ laughter ] stevie they gave you a little more hair, huh . Steve oh, my god. Nice. [ sniffles ] steve papa. Esteban yes . Steve congratulations. Esteban you did it. You did it. Lemonis i really feel like the moment in front of the mural was kind of a culmination of years and years of joy and frustration and sadness and fear. And in that moment, i think the grafton family realized that they were finally heading in the right direction. Test you have the mural on your arm, dont you . Stevie the american dream. The eagle. Lemonis ive never seen it. Ryan oh, do it. Stevie there you go. Mary flex. Stevie which ways the beach, you know . Ryan ill say, with all sincerity, when i saw mural for the first time, i actually felt like i had a future at the business. It made me want to be a part of it. Lemonis thats really awesome. Amber that is nice. Ryan thank you. Lemonis i really think that having all six of them of them involved in the business in their own area and being responsible for it and them learning and being open to learning things, steve specifically, i think made a big difference. One of the most honest guys ive ever worked with, even when its bad news, and the most creative person that i know. Amber wow. Lemonis those two things. Amber guess someone really believes in you guys. Mary and thats absolutely true. Melissa its absolutely true. Amber steve, has marcus brought you, like, future business . Has he brought stuff to you . Steve yeah, definitely. In 2017, we manufactured all the furniture for his house in montecito. Lemonis when i saw all this furniture in my house, it was one of the proudest moments ive had in the history of the show. It was like i had a baby. Steve yeah. Amber yeah . Lemonis i felt like my business had a baby. And in all fairness, it wasnt that expensive for how much furniture i got. Steve right. Lemonis i still would have wanted a better deal. [ laughter ] the tuesday turnaround to a wednesday whiplash the white house is preparing for what could be the largest stimulus package ever. Promising 1,000 checks to those affected and banking on a bail out. For the airline industry, they are almost ground to a halt how washington is getting ready to back dlstop