Transcripts For CNBC The Profit 20240712

Lemonis and yet she still doesnt want to take the risk to adapt to the latest trends. Maggie i dont think i would call myself a rebel. Lemonis what would you call yourself . Maggie safe. Lemonis . Even if thats what the customers want. Woman 2 you need to be more aggressive with the style of the leggings. Maggie no. Lemonis if i cant get this owner to think creatively. Maggie i like the shape. I like how it fits the waistline. Susana its really mediocre. Maggie thank you. Lemonis . Her beloved fashion brand may go out of style forever. Honestly, i wouldnt take any of that. None of it. My name is marcus lemonis, and i risk my own money to save struggling businesses. Were not going to wake up every morning wondering if we have a job. Were going to wake up every morning wondering how many jobs we have to do. Its not always pretty. Everything is going to change everything. But i do it to save jobs, and i do it to make money. This. Lets go to work. Is the profit. The athleisure industry has exploded in the last several years, and what appeals to me about montiel is that it broke through the clutter and quickly gained a following. Its only been around since 2013, so im heading over to the companys warehouse in downtown l. A. To learn more. Hello . Hi. Maggie hi. Lemonis how are you . Maggie im good. How are you . Lemonis good. Im marcus. Maggie maggie. Nice to meet you. Lemonis maggie, nice to meet you. Kiara kiara. Yes. Lemonis kiara . Lemonis thats a cool name. Kiara thank you. Cambria cambria. Lemonis how are you . Another cool name. Everybody has got nice names. Are guys all wearing the product . Kiara yes. Maggie we are. We are. Kiara we live in it, so. Cambria i wear it, like, every single day, like, to work out in. Its just its perfect. Lemonis yeah. Athleisure is really the new denim. Maggie well, you know, once you go leggings, you dont really go back in your jeans. Lemonis are you trying to hurt my jean business . Maggie no, no, no. I wear them on the weekends. On the weekends, on the weekends, on the weekends. Lemonis do not mess up my jean business. So what exactly do you guys do . Maggie so we make womens activewear bras, panties, leggings, stuff like that. We do all the manufacturing and everything in san diego, so its all made in the usa. I use a contractor. Lemonis oh, you do . Maggie . But i order all the materials to make it, and they cut and sew it. Lemonis can i see some pieces . Maggie yeah, of course. Lemonis i want to see what the top sellers are. Cambria definitely our teardrop bra. This is our numberone seller. Lemonis this is the numberone seller in the company . Maggie yeah. Thats the one that i started with. Lemonis wow, this feels really nice. Kiara right now, i have on the reagan. Lemonis which one is that, that one . Kiara this one, in black. Lemonis what do you like about that . Kiara i think the straps. Lemonis okay. Cambria these are the lea leggings. Lemonis how much stretch is in here . Cambria theres about 5 spandex. Lemonis yeah, it does feel nice. As i look at the products that maggie makes, i would say that, from a quality standpoint, theyre superior. You put a nice grain in it. Maggie yeah, thats our special blend. Lemonis . But they seem very plain. How many different colors overall in your whole collection . Maggie 9, 10. Lemonis and what if you wanted to come up with a printed fabric or a different color . Maggie i would never do printed. I think its a little cheesy. When i think of prints and stuff like that, theyre more fad. Lemonis so who created this . Maggie me. I kind of got a little bullied with that one because everybody was doing color blocking. I dont think i would want to be seen in that. Cambria my sister loves them. Lemonis i get the sense, and im totally reaching here, that if you dont like it, it just doesnt sell. Maggie its kind of easy when its your line. You can kind of control that. Lemonis and so, how do you innovate . Maggie i do what i want, you know, kind of like what i would want to wear. Lemonis its obvious to me that maggie makes products that she likes and that fit her personality. Oh, is this your look book . Maggie yeah. Lemonis the only thing it doesnt show me is how i could use the product. And whats puzzling to me is the presentation of it. I dont see any diversity in terms of activity, not even riding a bike or jogging. The usage of the product feels a little onedimensional. If you like to do a particular activity or wear a particular color and maggie doesnt have it, its almost like shes telling you, go shop somewhere else. Who actually designs . Maggie so i do the design. What i do is, i come here in the morning. I usually arrive before them, and i get so much done before they come. Lemonis like. Maggie see, im so weird because i cant have noise. I cant work with noise at all, and i go, and i do the rest of my work from home in silence. Cambria its really weird. No, we just sit here and talk to each other all day. Lemonis let me just see if i can understand this again. You come here early in the morning when nobody is here. You work, and then as soon as humans come around. Maggie im out. Lemonis . You leave, and you go work at home where theres nobody. Maggie exactly. Lemonis maggie actually reminds me of a girl that used to sit next to me in grade school who used to always shush me. I would describe maggies personality as introverted, and theres nothing wrong with that, but if youre going to lead a business, youre going to have to somehow get out of your shell. Its directtoconsumer only. Maggie yes. Lemonis . And trunk shows . Maggie no trunk shows. And we dont do wholesale. Lemonis thats it, online, no other way to buy it . Maggie as of now, yeah. Lemonis buy it from you, or dont buy it at all. Maggie right. Well, and we did that because i wanted to offer a better price. So i wanted to charge 38 bucks for this and not 58. Lemonis right. It seems problematic to me that maggie only sees value in selling online, and while im in favor of the bulk of her revenue coming from that channel, its helpful for a business to just think differently and not think so onedimensional. What prompted you to open this . Maggie it kind of fell in my lap. My dad has been in the industry. Lemonis your dad was in this business or just in the fashion business . Maggie yeah, in the apparel business. Yeah, for 40plus years. Lemonis really . What did he do . Maggie he did ashworth golf apparel. Lemonis okay, cool. Maggie yeah. So my dad was liquidating one of his lines, and it was a ladies activewear line, but it was more towards an older demographic, so i helped him liquidate the company, and i was doing trunk shows, and i went to my dad. Im like, how can i make this bra in a ton of different colors . And thats where it started. Lemonis when did you start this . Maggie november 2013, and that was in my twobedroom apartment. Lemonis so how many team members, just the three of you . Maggie so for the office, its the three of us. Lemonis and your dad is still involved in the business . Maggie yeah. Hes our ceo. He helps. Lemonis why arent you the ceo . Maggie because i think that having somebody whos been in the business and knows what hes doing and has taken other Companies Public is really important because, at that time, i wasnt qualified to be a ceo. I wasnt qualified to be a president at the time. Lemonis on first blush, it seems like a good idea that maggie has really acquiesced the ceo title to her father, who has years of experience in this industry, but to use him as the ceo feels a little like a copout to me. And so social, who drives social . Maggie me. Lemonis you do . You do it all yourself . Maggie mmhmm. I did all of my advertising through facebook, and i got in at a really sweet spot. I had sales right away, and i had people following us, like, really fast. Lemonis i think its very smart that you did that. Maggie thank you. Lemonis it seems like a great instagram product, as well. Maggie yes, it is. Lemonis how much inventory in total . Maggie theres about 24,000 units in here. Lemonis and what does that equate to in dollars . Maggie its about 250,000. Lemonis what were you doing in cost of goods for the year . Maggie like 44 . Lemonis so how much revenue will you do . Maggie sales, we did 1. 8 million. The year before, we did 2. 1 million, so we dipped. Customers, theyre just not coming back. Lemonis do you ever change your mindset and come up with new things . Maggie i have no interest in that. Lemonis uhhuh. Maggie i feel like i have a lot of pressure on me, and lemonis where is the pressure coming from . Maggie myself. I want to be successful for my parents. I dont sleep. It was worse when i was younger. Ive kind of gotten control of the anxiety part. Well, to get it started lemonis are you happy now . Maggie no. Lemonis why not . Maggie because now im worried. Now im worried. Lemonis would you have fun, please . Maggie okay. Well, all right. Im trying. Lemonis any time i go into a business, i have to really, early on, determine what my process is going to be like with the business owner. Am i going to have to be very tough . Am i going to have to be aggressive . Am i going to have to be persuasive . In the case of maggie, giving her opportunities to try things without fear or failure or without any consequences to that failure may be a better path. Maggie told me that her father is actually the ceo, and so i thought itd be a good idea for us to meet before we sat down and had any more discussions, so were going to meet at the cutandsew factory in san diego. How are you . Im marcus. Gerry im gerry, marcus. Lemonis gerry, how are you, sir . Gerry im good. Nice to meet you. My pleasure. She wanted to get in when she was about 10 years old, and she wanted to make clothes when she grew up. Lemonis because her dad made them . Maggie yes. I was running around in ashworth as a kid, up and down, as they were sewing. It was like yeah. Lemonis can we get a tour of this place . Maggie absolutely. Gerry sure. Lemonis this place is cranking, isnt it . Gerry this is a great shop. Lemonis i mean, wow. Gerry these people have just been fabulous for us. Lemonis theyre amazing. And so once it leaves here, its bagged and tagged, right . Maggie and it comes to l. A. Lemonis im impressed with the type of capacity that is available to her at her cutandsew operation. What it tells me is that if the business explodes, were not going to have a problem on the manufacturing side. Sally hi. Maggie this is sally. Sally, marcus. She does all the patterns. So this is where we do all of our cutting. I buy my fabric. It gets shipped here, so hes holding our fabric, as well. Lemonis do you think her personality and the product are similar . Sally yes. She tones it down a little bit. Lemonis she pulls you back . Sally yes. Maggie we have different styles. We do. Lemonis i would love to see something thats, like, different. Sally well, she wants to play it safe starting out because we dont quite know our audience yet, and you want to make products that are for sure going to make it out the door. Black and white is a sure thing. Lemonis now, its clear to me that maggie and sally have put a lot of thought into the pattern, providing the right support, but remember that consumers buy with their eyes, and so if its not visually appealing, you may never get a chance to tell that story that it fits great. So it goes to the customer like this, so no branding on here at all. And this really gorgeous bar tag is on there, or do you take it off . Maggie unhunh. Lemonis they see it, and they get a warning label, nothing about montiel. Maggie not in that polybag, no. Gerry thats a good idea that youre making, though, that maybe we should print some bags. Lemonis i would almost advocate spending the money on doing a twotone bag, where theres maybe clear and then a smoky window where you can actually print on it. Itll stand out. I think the thing that people have to remember is, a good chunk of what happens online is gifting, and if i wanted to buy that gift for somebody, i would have a high expectation that it would arrive with a level of presentation that would make me feel like you put in attention to detail around everything. All right. Well get out of your hair. Thank you so much. Maggie thank you again. Lemonis how are you . Maggie good to see you. Lemonis how are you, sir . Gerry how are you doing, bud . Lemonis its good to see you. Thanks for coming out. Gerry oh, my pleasure. Maggie so im going to give you the 2017 financials. I also brought this. Lemonis you know, maggie, im old. I cant read this. Maggie i know. Gerry i didnt bring my glasses, either. Lemonis so 2016 was a little bit over 2 million in revenue. Gerry right. Lemonis it looks like it made 96,000. Gerry yes. Lemonis okay. In 2017, shows 1. 8 million of revenue, so was it a loss in 17 . Gerry no, we actually made about a quarter of a Million Dollars last year. Lemonis revenue went down pretty significantly, right . Maggie yes. Lemonis how much inventory do you have in your warehouse . Maggie about 250,000. Lemonis and how much cash in the bank . Gerry 300 grand. Lemonis remind me was there any debt in the company . Maggie nothing. No debt. Lemonis no debt. Essentially 500,000 in assets. Gerry yes. Lemonis . With a nice profitable business. So why did you guys call me . Where do you think i can help you . Maggie i want to continue to grow, and i know i cant do it alone. Theres not as many orders this month, you know, compared to what it was last year. Lemonis business is slowing down . Maggie yes. Gerry what do we need to do to increase our marketing to gain sales . Lemonis i think when you really want to take the thing from 2 million to 20 million, youre going to have to try things that, 50 of them may you have to have a stomach to be able to swallow a failure. I didnt get the sense, in our first day, that youre necessarily a risktaker. Maggie okay. Lemonis i feel like the line is a little flat. It feels very safe to me. Maggie mm. I still dont look at it as safe. I let the customers kind of lead me. Its worked. Gerry i think maybe, in the business, its a little bit of a handicap for her. Lemonis why . Gerry she doesnt want to disappoint me. Shes a little conservative in a lot of things that she does. Lemonis shed rather go straight and slow than make a left or a right turn and have it be wrong out of fear that it may disappoint you. Gerry lot of truth. Maggie theres a lot of truth to it. Lemonis i love the business because i feel like you live the business and you are the business and that your work and your social lifestyle is the product. So i want to invest 1 million in the business. Maggie a Million Dollars . Lemonis yeah. I know womens apparel pretty well. Im willing to take chances, and how i see it is, you will be the ceo of this business, not your father and not me, and in order to be the ceo, you have to be bold and a risktaker. Safe doesnt work for me because i like to throw stuff against the wall and see what sticks. Gerry right. Lemonis . Spending money on custom colors and spending money going out and doing research. I think the packaging is terrible. It doesnt feel special. Maggie it could be so much better. Lemonis theres some level of embellishment that can be done to some of the products to give it a novelty piece. I dont think that this product should be singularly focused on a yoga lifestyle. Maggie yeah. Lemonis i think its more of an active lifestyle. I would then look at contract manufacturing, really building collections for other people. Gerry perfect. Lemonis so my offer is 1 million for 60 of the business. Maggie um. So i didnt think we would have to give up as much equity, but i so value you. I would like to do something that would be under 50 equity. Lemonis um. If your business is in trouble and you need my help, log on to theprofitcasting. Com. Maggie i would like to do something so youre a small bor a big one. You were thriving, but then. Oh. Ah. Okay. Plan, pivot. How do you bounce back . You dont, you bounce forward, with serious and reliable internet. Powered by the largest gig Speed Network in america. But is it secure . Sure its secure. And even if the power goes down, your connection doesnt. So how do i do this . You dont do this. We do this, together. Bounce forward, with comcast business. That would be under 50 equity. Lemonis what percentage were you hoping that i was at . Maggie 40 . Lemonis um. You bring years of experience. She brings the knowledge of the industry. I want to be respectful of that, so my revised offer is 45 of the business for 700,000. Gerry what do you think, mags . Maggie absolutely. Gerry lets do it. Maggie i could not lemonis you want to do it . Maggie yeah, absolutely. Lemonis okay. Maggie that is so cool. Lemonis you ready . Maggie im so ready. Lemonis okay, congratulations. Maggie thank you so much. Thats awesome. Im so excited. Lemonis congratulations. Gerry thank you so much. Lemonis its going to be fun, man. Whats up, my man . Kenny how are you . Good to see you. Lemonis did you dress up for me . Kenny i did. Lemonis today were meeting at lua sol. Its a company that can license prints and different designs and lyrics to put on a lot of our garments. This place is pretty much the exact opposite of what maggie does. Im hoping that shes open to this idea. Putting any designs on her garments would be a huge change for her. I wanted to create a couple of capsules inside of montiel, one thats maybe maggie. Kenny yep. Lemonis actually, that would be the name of it. Kiara oh, wow. Thats so cute. Cambria so cute. Maggie its a pretty cute name. Lemonis we want it to be really representative of your personality. Maggie oh, boy. Lemonis . Which i havent seen yet, so at this point, itll be a bowl of vanilla ice cream. Maggie i dont eat ice cream. Lemonis my ultimate goal with montiel is to create three distinct lines of revenue. The first line of revenue is to continue to sell her Core Products and add embellished products using lua sol under the brand of maggie. Tshirts, other products that she has today, but something fun and different. The second line of revenue would be for maggie to collaborate with one of my other designers and companies, susana monaco, to create a whole new line for the wholesale market. The third line of revenue would be maggie creating cobranded products for specific businesses, unique just to them. Kenny this is a list to inspire where you want to land in terms of your messaging. To think about lyrics, its endless. Maggie okay, so, you may say im a dreamer, but not the only one. Eh . No, i dont think so. I found the greatest love of all inside me. No. Im just beautiful me selena gomez. Eh, no. Look at the stars. Look how they shine for you. I will be rising from the ground like a skyscraper. Interesting . Lemonis none of those you like . Maggie no. I didnt love them right off the bat. Lemonis im disappointed with the fact that maggie is not even being openminded to any of these ideas. No usually should be followed with, but what if we tried this . Or, what if we did this . Kenny are there any artists that inspire you . Cambria i think lady gaga is, like, supercool, such a strong woman. Maggie yeah, nope. Cambria nope . [ laughter ] maggie let me skip her. Juli but i think that she has a plethora of songs, i feel like, and lyrics can mean something to everybody, like, a little bit something different. So its youre pulling that emotion out rather that promoting that persons face. Maggie right. I mean, ive loved, whats her name, dua lipa . Her whole album nailed it. Lemonis you should buy montiel why . Maggie why . Because its good quality to live a comfortable, Healthy Lifestyle and for a better price point than the other guy. Lemonis welcome to target. We need to pick 10 or 15 things around here that we can start to get to work on, and i want you to work with juli, collaborate with her, because we need to get some direction and, like, some [bleep] done. Thank you, guys. I love this area. Maggie i know. I always say i want to live over here, and then i never do. Lemonis until now, maggie has marketed her company entirely to the yoga community, and so i want to open up her mind, and im going to take her to flywheel. Its a National Chain of spin studios that are going to have a ton of active, outdoortype customers, and theyre going to give her good feedback on her product. And if she plays her cards right, there may even be an opportunity here. I want to see people actually use the product, i want to get their feedback on the product, and then were going to go to new york and talk to them about taking over their whole Apparel Department across the country. Maggie oh, wow. Okay. Lemonis all right. Lets go inside. Maggie so im going to get you going first. Do this one. Ill pull some extras out. Woman 3 do you have green pants . Maggie i dont have green pants. Lemonis having a full class of customers wear our product and use it during an actual class and give us feedback is a great way to do research to give us the kind of changes that we need to make to be successful with flywheel. [ all cheering ] maggie so lets hear it, guys, anybody. Woman 4 one thing i just noticed right now is, like, you can sort of see the sweat around the crotch area. Maggie i mean, with nylon, its going to happen. It will dry really fast. Woman 2 you need to be more aggressive with the style of the leggings cutouts, metallics. Women really like to get a little bolder. Maggie no. It does really well, and it sells. Woman 5 in the tops, i would love to see, like flowy crops would be really nice. Woman 1 and then this looks a little mommy to be. If you really made a point of being, like, the one that had the fashionable bras, women need that. I dont know what your demographic is. Like, i would never wear that. Lemonis i dont love the font. Its very cartoonish. Maggie look on the inside. Got you, girl. Its an inside pocket. Lemonis i dont think theres anything special about this. Honestly, if thats what were taking to flywheel, we shouldnt go yet. Wthe lack of controlow whenover my business kai, is. Made me a little intense. But now quickbooks helps me get paid, manage cash flow, and run payroll. And now im back on top. With koala kai. Save over 30 hours a month with intuit quickbooks. A livcustomizeper iquickbooks for me. Okay, youre all set up. Thanks that was my business gi, this ones casual. Get set up right with a live bookkeeper with intuit quickbooks. Like, i would never wear that. Maggie i have the proof that it sells. Woman 2 fashionable. Woman 1 like, clearly, fashionable bras, like, thats huge. Woman 6 i have a shirt that says, like, heart and hustle. Like, id kind of like a, heart and hustle. Woman 1 i think that this is this is always hard. Lemonis this what . What is that . Woman 1 the leg. Its always hard to figure it out. Usually i put them under my shoe, but then it gets caught, and then my pants fall down. Lemonis theyre long on almost everybody. Maggie theyre made to shrink about 1 2 an inch, so they will tighten up for the ones that are loose. Lemonis but i dont want to buy something that i have to wash to make fit. Maggie no, but its. Lemonis . As a consumer. I was kind of surprised, even shocked, at how combative maggie was while she was getting feedback from people about her products. Okay, thank you, ladies, very much. You have to be able to listen to all the feedback and take the superpositive stuff and the supernegative stuff and lay it off on the side and find something thats running through the whole thing. Maggie i am getting frustrated because youre challenging me. Lemonis its how you process the feedback. Its like, well, youre going to wash it, its going to shrink, and its going to be fine. Maggie no, i just want them to know that theres hope, like, if it feels too big. Lemonis well, but maybe it just needs to be fixed. Or, your pants are too long. Yeah, but, you know what . Theres different sizes for everybody, but everybodys pants were long. Maggie yeah, everybodys pants were long. Lemonis okay. All right. Maggie im going to throw her in stretching, too. Man 1 yeah, lets do that. Lemonis ive wanted to change the way that maggie was marketing the company specifically just to the yoga community, and so we flew all the way to new york so we can do a photo shoot in central park a different environment, a different attitude, a different mindset. Maggie can you do a couple jump squats . Lemonis in order for this company to be successful, we need to be able to demonstrate that it can be more exciting and can be used for more than stretching. [ camera shutter clicking ] id like to get some fun. Its, like, everything feels so serious right now, and i think you need to loosen up. Maggie no, i love fun. Hold my hand, and, like, we can go in the squat and see how long. Lemonis thats the fun part . Maggie yeah, youre burning calories can you squat pulse . Put your back up, shoulders down. Lemonis no, no, but im talking about, like, fun. Show me somebody jogging, somebody at cycle class. Show the the versatility of it. Maggie got you. Man 1 hurry up. Hurry up. Hurry up. Maggie slide in man 1 and then go again. Maggie that was awesome. Lemonis come on, maggie. Maggie im so embarrassed of you right now. Lemonis what are you embarrassed for . Maggie im embarrassed of you. Lemonis maggie is afraid to do anything outside of her comfort zone. Im trying to put fun in the shot. Hi, there. How are you . Maggie hi, guys. Lemonis look, if this company is going to grow and were going to have any chance for success, maggie is going to have to get over her fear of failure. Well, guess where im going to take her . To the museum of failure. Darren its a collection of failures from large companies, and the point of the museum is to show that success doesnt happen without failure. Lemonis wait a minute. When did oreos become a bad idea . Leila the idea is that theyve innovated a lot, and theyve tried all these different flavors, and theyre still a huge success, so its kind of a motivation. Lemonis to say, try stuff. Leila yeah. Maggie yeah. Lemonis where is it that you try new things . When does that happen . Maggie im going to launch five or six new colors for spring, and i dont know if theyre going to be perceived well. Lemonis what about new products . What about selling in the wholesale market . Maggie i want to. I dont want to say no to wholesale. Lemonis what if i told you that you have to totally change your model . Maggie i think id say, i love you. Stephanie hi. How are you . Maggie im good. Stephanie stephanie menkin. Nice to meet you. Maggie maggie. Nice to meet you. Susana nice to meet you. Welcome. Lemonis so the reason that i wanted to get all three of you together is, stephanie runs the entire fashion business for our company, and one of the businesses is susana monaco, somebody thats been through it, that has experience. Susana has been in the business for 20something years. Susana 22. Lemonis susana monaco was a Small Business that i invested in several years ago, and shes a successful designer that happens to specialize in a very similar material that maggie uses. When i first met susana, she didnt want to change, either, and as she took that leap of faith, she was able to experience success in her business. And so i thought by putting maggie and susana together, susana would pull her along and say, look, this is whats happened to me. The numberone reason people dont make it is . Stephanie trust the process. Susana i mean, nothing is easy when you start. You, you know, adapt, and you learn the processes, and you open up to that, and then it gets easier. Maggie right, right. Stephanie you have to make changes to get to change. Lemonis i think theres a way for you to get to the wholesale market, but do it through susanas platform. Susana has the opposite of what you have very little online business, and she has a ton of wholesale business. And so what i want to task both of you with is, lets pull pieces out. These products that youre picking are going to be marketed as a fusion between the two of you. Your name and your name are both going to be on them. What i wanted to have happen between the collaboration of susana and maggie is for each of them to share their ideas with the other brand, and so that if there was top pieces being sold at susana, that maggie may be able to put her own twist on them. Conversely, ive been longing for susana to be in the athleisure business, and if she could learn from what maggie does best with her topselling skus, she would be able to sell those, as well. Its a sharing of designs, ideas, data to a totally different marketplace. So give me the top sellers in each category, and lets start with that. Maggie this is number one. Susana this, in our world, in tops and dresses, doesnt sell well, as much as that lemonis what are you pointing to . Susana the asymmetric bottom. Lemonis doesnt work . Susana no. Maggie ballet wrap, its a onesizefitsall. Susana i dont think it works if were going straight for the athleisure component of this. Maggie it does really well, and it sells. They want it. Like, theyre asking me for more. Lemonis in order for maggie to grow her business, shes going to have to listen to the things that susana experienced in her own business. Susana will be saying, ive been here, and my line used to be plain, and in order for you to grow your business, i think youre going to have to really jazz it up. How much of this stuff would sell to your current base the way it is today . Susana 10 , maybe. Lemonis not much. Susana i dont think its much because theres too much out there now thats wowing people. Lemonis youre saying this is too flat. Susana i do. I do think it is. Lemonis what do you think needs to be on here to make it work . Susana i would change the fabric and change the color. Maggie what i created, a lot of it was based off of what i wanted, and i like the backs, and the backs sell. Stephanie i feel like youre afraid to change things because you have a certain set of customers. You feel like youve had success enough and that youre afraid to, like, rock the boat. Maggie i honestly have no fear of rocking the boat. Lemonis hearing from me about how maggie should change her designs or change her business is one thing, but hearing from susana, who has 20 years of experience in this same industry, should really change the way maggie is thinking. So this is the start of the collab . Stephanie this is it. Lemonis it needs to get tweaked. You need to go over everything, and then we need to weave in the susana monaco stuff. Susana yeah. Stephanie agree. Maggie mmhmm. Lemonis hello. Maggie hi. Lemonis i wanted to check in on how the designs were working for the flywheel pitch, so i asked maggie to bring some of the garments over to my office in los angeles. So the meeting with flywheel is next monday. Im super nervous about taking product somewhere that i havent even seen. Maggie yeah. No, i know. Ive been working on it, and i want to show you some stuff that i have put on. Lemonis okay. Maggie okay, so flywheel im going to take you through over here. Put the logo on. We got the logo, and then we made lemonis from them . Maggie we made the heat transfer. Thats the only logo we got, so. If it was my choice, i wouldnt have put the logo on anything. I know that, in my friends, we dont wear logos. We just dont. Lemonis okay. I thought it was a little odd that maggie was resisting putting the logo on the garments, and i would understand that if it was her own brand, but were doing a presentation specifically for flywheel. Can i see something fun . Maggie so i kind of just put stuff down, and these are all words that kind of describe me, and then i kind of got a little cheeky. Lemonis okay. Maggie no, thank you. My niece, shes 3, and she says, no, thank you, to everything. Lemonis okay. Maggie and i wanted to use those words and put them in little places on the garment. Kinda classy, kinda hood. Sideboob friendly, because a lot of the bras show it. I wear black. Pinky out. Cutouts for extra ventilation. Lemonis i appreciate that maggie is trying to be innovative, but cutting a hole in something for ventilation isnt what i would exactly call riveting and game changing. Maggie we played with this also a heat transfer. I can make it look much better with digital embroidery. Lemonis i dont love the font. Its very cartoonish. Maggie look on the inside. Got you, girl. Its an inside pocket. Lemonis i dont think theres anything special about this. Maggie had the opportunity to use lyrics and graphics from some of the best artists ever in music, and instead, she puts on something that looks like it came from a gradeschooler. Juli well, and its such a cute phrase for the inside pocket. Like, i got you, girl. Ill hold on to your whatever. Maggie because thats where they put their your credit card. Lemonis honestly, if thats all were taking, then we shouldnt go yet. Maggie i see going to market separately. Susana i thought the whole idea was that we were going to add to the collection, to sell a collection. Lemonis it was, but im just trying to figure out when the [bleep] thats going to happen. We shouldnt go yet. I wouldnt take any of that. None of it. Like, i dont even want to have the meeting monday. Maggie really . Lemonis yeah, because it doesnt feel special to me. Juli we thought to play it safe to not offend them, and then we can lemonis i know, and i dont want you to play it safe ever. And if the other person doesnt care for it, then maybe its not a good fit for montiel. What i would have done a little differently, i probably would have created a line that was specifically for them, not took our Core Products and put their logo on it. Maggie right. Lemonis we need to work on it over the weekend. Maggie yeah, big time. Lemonis cool. Maggie yeah. Lemonis okay. Ill see you in new york. Maggie see you in new york. Juli thank you. Lemonis with the flywheel pitch just around the corner, maggie is working on her presentation and making final little tweaks to her pieces. And while the flywheel prototypes are in production, im taking maggie to century packaging in order to elevate the customer experience. Frank so we do everything from start to finish. We print, die cut, and glue. We actually do the graphics here, as well. Maggie oh, i like that. Lemonis the goal is to ensure that every time a customer buys something online from montiel, theyre getting something special. Maggie i mean, these type of items sell the best. Its loungewear kind of. Lemonis maggie is also working on her collaboration with susana monaco. Maggie i like the shape. I like how it fits the waistline. Susana its really mediocre. Sorry, no offense. Maggie thank you. Lemonis but things arent going as smoothly as i had hoped. Its been 3 weeks since i first put susana and maggie together, and i still havent seen a single piece from the collab line, so im bringing maggie to susanas showroom in new york to get the real story. I thought maybe we could just get a summary since the last time we saw each other, what you guys have gotten done together. Susana well, we sent maggie some samples from ours. We went over prices and margins to see where we can meet in the middle. Lemonis i was thinking she would take your topselling pieces, put her twist of them, make some changes to it. Maggie that is what it was. When she left my office in l. A. , i picked two things from her collection that would work. Susana we have a library filled with stuff that can work. Maggie yeah. Susana i mean, what youve seen is not much. Lemonis what the [bleep] are we doing . Im not going to lie. Im disappointed that maggie admitted to me that she hasnt even looked up any of susanas top sellers. While maggie is softspoken and very nice, she hasnt actually done a thing, and her resistance to change, its more pronounced than ever. What the [bleep] is happening right now . Like, i dont understand whats happening. Stephanie she was like, it doesnt work, and then they gave up. Thats what happened. Say, yes, thats what happened, because that is what happened. Lemonis go through the whole. Maggie i will. Ill just go all the way around. Lemonis all the way this way and all the way and just put here what works. Maggie okay. Nope. Lemonis okay. Maggie let me see that one. Lemonis yes or no . Maggie its too long. Lemonis maggie . Maggie no. Lemonis maggie . Maggie i dont no. Lemonis what about this . Maggie the v. Lemonis you dont like the v . Maggie i dont like the v. Lemonis you guys found nothing else in this whole thing . Maggie nothing. Lemonis what is this . Maggie that would be hard for me to sell because its too too basic. I see going to market separately. Susana i thought the whole idea was that we were going to add to the collection, to sell a collection. Lemonis it was, but im just trying to figure out when the [bleep] thats going to happen. Tara i think we have to capture more of flywheel in the overall design approach. Sarah i do think the product, like, needs work. Susana i thought the whole idea was that we were going to add to the collection, to sell a collection. Lemonis it was, but im just trying to figure out when the [bleep] thats going to happen. I havent asked maggie to do anything revolutionary. I wanted her to collaborate with susana so that we could all make some money, and in my opinion, the lack of even making the effort is a giant fail. Was this idea of having them Work Together a mistake . I think that the two of you need to do what you do best and not try to do something that you dont do. Susana, you have not had the time, the energy, or the resources to dedicate to the website. Susana not full force. Lemonis she knows online. I would argue that she should run the two websites and you should run the wholesale community, and so why not just put everybody in what theyre best . I think the two of you have your own look and your own opinion and your own appeal, and we just want to keep that separated. And so, i would learn how to lean on each other. From here, theyre going to have to look at this partnership differently. Despite the fact that they dont want to design together, they can still help each other generate revenue. Maggie is brilliant in Online Marketing and social media and using those outlets to sell directly to customers. Susana knows the wholesale market and how to sell direct to boutiques across the country. They could still learn a lot from each other, but both of them have to be open to it. Put your worlds together and figure it out. How are you feeling . Maggie a bit nervous. Lemonis today is the big pitch at flywheel. I would really wow her with, like, a real fine knowledge of every square inch is money. Its going to be paramount for maggie to differentiate her products from what flywheel already sells. You have to be prepared for them to Say Something like, well, this stuff sells. I just hope that shes taken her line far enough for them to see that. Sarah hi. Juli hi. Im juli. Sarah im sarah. Juli nice to meet you. Lemonis hello, everybody. Good to see you. So im going to turn it over to maggie. Maggie well, my thoughts for you and what i want to create for you is a totally different line using my pieces, but were going to call it fly girl. Sarah really cute. Maggie youre even flyer than you think. Youre challenging. Youre intensely fun. Youre not like anyone else. These are kind of the words that i think represent myself, and i think they represent a lot of women that i know and, i think, represent you. Well go through some of the product. Here are some hoodies. We have that hoodie that comes longer. Tara my one comment would be, its a touch bouncy. I wish it had a little more not want to use the word substance, but just a touch more. Maggie okay. Tara and the tops are almost like our billboard for fly because thats where we can put a logo to, again, marry the two and to tease a functional product, as well as marketing for the brand and being a part of our family. Maggie this is what i dont want to do. Every time i see Something Like a big logo like that, i just know thats going to sit on the rack longer. Tara but i think we have to use the fly logo because our fly family, whether its employees, instructors, riders, everyone thats coming in wants to feel a part of the brand identity. And no mesh on this one . Maggie no mesh, but look on the inside pocket. We put a little, got you, girl. Tara nice. Maggie . Which will actually go on the inside of that. Tara okay. And more of a high waist on the bike . Maggie yeah. This is a highwaisted one. Tara okay, great. Maggie so, thoughts so far . Michael theres a lot for us to think about. Lemonis for exclusives, extras, and business advice, visit theprofit. Cnbc. Com. So youre a small bor a big one. You were thriving, but then. Oh. Ah. Okay. Plan, pivot. How do you bounce back . You dont, you bounce forward, with serious and reliable internet. Powered by the largest gig Speed Network in america. But is it secure . Sure its secure. And even if the power goes down, your connection doesnt. So how do i do this . You dont do this. We do this, together. Bounce forward, with comcast business. Maggie so, thoughts so far . Tara i think your approach was maybe too soft. Its not really representing the feeling that we are getting that performance result. Lemonis i told her that it looks like the words and the embellishments were too soft. She didnt make enough changes. Tara i think we have to capture more of flywheel in the overall design approach. Maggie mmhmm. Tara i think from where we are, shes a little fiercer. Maggie yeah. Tara shes a little more bold. Sarah i do think the product, like, needs work, like, just to take it up a notch to a level thats just more iconic and memorable. Lemonis thank you so much. Sarah yeah, thayou. Tara thank you. Lemonis thank you so much. Thank you for taking the time. Maggie thank you. I really appreciate it. Lemonis what theyre really looking for are new, innovative things, new products, new graphics, new designs. Yeah, what ive been telling her the whole time. If she would have just listened to me a little bit and thought outside of the box, wed at least be walking away with something. Now were walking away with literalnothing. Maggie. Maggie marcus. Lemonis whats happening . Maggie hi. How are you . Lemonis how are you . Everything good . Maggie yeah. Lemonis im heading in to see maggies final maggie line, her reveal of all the changes and things that shes done, and if i dont see something revolutionary, to be totally candid with you, its going to be three strikes, and youre out. Maggie so i was going to show you on a laptop, but i figured id print all of this out because its easier to see. This was for you. Lemonis that was for me or for you . Maggie for you. I think of the maggie line as an extension of me, and i dont think that that necessarily represents me. Lemonis maggie didnt even have the courtesy to bring actual garments to me or to change anything, not even the poses that the models were in, the Color Palette that was used. It was almost like she sabotaged it on purpose. Maggie i wouldnt wear it, personally, but i know my customers would. Lemonis it is ironic to me that you say, my customers would all buy this, but i just dont like it. Maggie i dont think i would take anything all the way to production if im not going to be happy with it. Lemonis which is why im looking at pictures and not product. I think you have zero interest in changing anything. Its sort of like banging my head against the wall, and even asking you to try things didnt even work. Maggie i couldnt agree more. Seriously, i mean, im trying to think, and im trying to make sense of, like, okay, im giving him, you know, 45 of my company to someone where i dont feel like im going to benefit from. Lemonis im not going to lie to you. I have a little bit of frustration that you wasted my time. I feel like you strung me along, and you didnt see value in the relationship. Maggie what ive seen is, like, with the flywheel, you know, when that didnt go through, its like, okay, that didnt go through. Lemonis it didnt go through because you didnt make anything different. Maggie yeah. Lemonis and it was the same with susana. What i was going to see today was going to tell me if you really wanted to move forward or not, and the fact that you didnt even go try to silk screen something or print something. Maggie i was kind of hoping for something to happen to where i. Lemonis yeah, me, too. Maggie . Felt like, wow, this is going to grow my business. Lemonis maggie, you didnt trust the process, and my process is getting you to try things to open up your mind. Maggie yep. Lemonis i feel like, in your own way, you gave me f yous along the way. Essentially said, yeah, im not going to do any of this stuff, rather than regurgitating all the things that didnt work, like flywheel, like lua sol, like susana, like coming up with new products. Really, none of that happened, and you just didnt buy off on it. And you should have just told me that, like, a month ago. I feel like i kind of wasted a lot of my time. Maggie im sorry. No, because i, you know, i obviously have so much respect for you. Lemonis look, i wish nothing but the best for maggie, but i dont think she ever really wanted a partner. I wish you a lot of luck. Maggie you, too. Lemonis im sorry it didnt work out. We either have revolutionary, innovative designs that are going to be cutting edge against the competition, or youre going to get swallowed and spit out by the competition, and i dont want my money or my reputation being a part of that. Lemonis tell them to know their numbers. Robbie he scares you, too . Lemonis . A husbandandwife team supplies the louisiana families with kids merchandise and maternity clothes. Robbie the colors are baby shower. Ellie its hideous. Sorry. Lemonis but 10 years in, theyve hit a wall. Like, when you post something, dont you know the style and the sku . Robbie no. Pos stands for two things in this store point of sales system and piece of [bleep] lemonis owners robbie and julie allen have managed to open two stores one in new orleans and one in baton rouge. But they still havent mastered the basics. Well, does this store break even . Robbie good question. Lemonis merchandise they carry lacks universal appeal. The clothes are nice, but theyre not