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. Katelyn hi, ladies, welcome in. Lady customer return. Tasha yeah. Lemonis lady fuller got the idea for a barthemed jeans store while still in school and then made it a reality. Lady we are obviously a bar of jeans. You walk up and kind of order a jean like youd order a cocktail or coffee. Lemonis the concept was a hit, prompting her to open up 12 more stores in just a few short years. But the denim game is incredibly competitive, and ladys aggressive expansion plus her retail inexperience created some serious problems. Lady these are superdirty. Thats disgusting. How the. Did it get like this . Lemonis blue jeans are part of almost everybodys wardrobe. Man is this all girls . Lady no, we do have mens jeans. Lemonis and i believe in ladys concept a specialty boutique for blue jeans. With tweaks and some refinement, i believe we can raise the bar and turn this into a national brand. Im in San Francisco to visit the flagship store. Its on a great block with tons of cars and foot traffic, and im liking the Energy Around here. Hi, there. Lady hi, how are you . Im lady. Lemonis im marcus. How are you . Lady its nice to meet you. Lemonis how are you . Amy hi, im amy. Lemonis amy. How are you . Lady im so glad youre wearing jeans. Lemonis you didnt think i would come to a jean bar with jeans . Lady belly up. Lemonis so, whats belly up mean . Lady our slogan is, you belly up to the bar, and well cover your ass. When someone walks in, we always say, belly up to the bar, and well help you. So you basically tell the jean tenders, these lovely folks, how you like your jeans to fit. Amy so you tell me straight cut, bootcut, relaxed, darker or lighter, and then what size you think you are, and i can help guide you to, like, the bestfitting jean. Lady the basic premise of the store is that you cant, you know, touch the jeans without us. Lemonis do they actually say to the people, you cant touch the jeans without us . Lady yeah. Amy mmhmm. Lady they cant walk behind the bar. Lemonis okay. Amy hi, ladies. Welcome in. Lemonis have you guys shopped here before . Woman i pop in every once in a while. You know, i just live down the street. Lemonis have you done this whole, like, belly up to the bar concept . Woman no. Lemonis you can belly up to the bar, but you cant touch the jeans without us. Woman i actually like to be able to kind of touch it myself. Yeah. Amy [ laughs ] lemonis i agree. We dont want you touching the jeans. Well, then, i dont want to buy them. So, lets see how the process works. Lady okay, so, can you back up a little bit . Lemonis [ laughing ] sure. Lady can you turn around . I think youre probably, like, a size 36. This is a slim straight cut. Lemonis i mean, you typically have to be slim to wear slim. So im gonna give it a shot. Lady youre pretty slim. Lemonis i have a big ass. Lady you have an athletic ass. Lemonis well go with athletic. Lady [ laughs ] marcus, how you doing . Lemonis these feel so, the problem with these they feel big on me. Lady i like the leg shape on you. Lemonis no, i cant fit in 34s. Lady do we have the size 36 . Amy we dont have them anymore. Lemonis these have too much stretch in them. I feel like im in, like, grandma pants or something with leg stretch. Lady yoga pants. Lemonis same issue. So these actually got even wider. Lady yeah, those are actually way too wide. You got to take those off. [ laughs ] lemonis you want me to take them off right here . Just like lady well lemonis they didnt have my size in most instances, and they didnt have much inventory for me to choose from. I felt like i was being given the leftovers. Why is it called blujean bar as opposed to blue jean bar . Lady im from new orleans, and so i came up with this idea that it was gonna be, like, a blues bar, like a new orleans blues bar. Lemonis does it feel like a blues bar in here . Lady it does not feel like a blues bar. Lemonis and so whats the model that you use for pricing . Lady so, basically, we have about a 50 margin, which is a huge improvement for us, just by trying lemonis so youre proven, but youre not gonna get there. Lady no. Lemonis today, blues jean bar is operating at about a 50 margin. The retail minimum for a Clothing Store should be north of 60 . If they want to make more money, they need to compliment the jeans with more products that have higher margin. For example, if jeans had a 50 margin and a tshirt has a 70 margin and a sweater has a 68 margin, youll add those all together and come up with a blended average somewhere around 62 . Why is the inventory so anemic . Lady well, i think weve been cashpoor. I have been trying to pay old debt and buy new inventory. Lemonis at the same time. Lady at the same time. Am our stacks used to be, you know every single one was to the top, and i had two back rooms full of these. Lemonis like, theres a whole shelf thats empty. Amy that used to be an entire wall full of denim. Lemonis so you used to have inventory just stacked. Amy yeah. Lemonis and what changed . Lady well, the business changed in the past couple of years, mainly cause i opened too many stores too fast. Lemonis how many did you open . Lady at the height of it, i believe we had 13 stores. Lemonis and how many stores left today . Lady we have three stores now. Lemonis what happened . Lady well, new orleans i dont think i understood the market. And i never could figure denver out. Lemonis but they wear jeans in denver, right . Lady they do wear jeans in denver. Lemonis so, denver. The next one . Lady boston. I did not understand the boston customer. The next one was san jose. Lemonis okay. Lady i never understood that market. We had mill valley, california. Lemonis [ laughing ] and why didnt it work . Please, dont say because you didnt know the market. Lady that is what happened there. Lemonis jeans isnt barbecue. Its not that complicated. Whether this is cleveland or the most fascinating city in america, its jeans. Really. So three stores left today. Lady yes San Francisco, chicago, then dallas. Lemonis what was the worst year . Lady i believe 2013. And we did like 8 million on the top line, but we had losses. Lemonis how much was that . Lady 396,000. Lemonis and that was with 13 stores . Lady that was with the whole engine running. Lemonis ah. In 2013, lady did 8 million in sales across 13 stores but lost close to 400,000. Thats because only three of the stores were actually making money. And the big problem was they werent making enough money to keep the other 10 open. And so the only solution was to keep those three and say goodbye to the rest. Lady every day, i sit there at the computer, and its, you know, how do i manage the lean amount of cash that i have . Because my numberone priority is to keep the lights on in three locations, pay old debt, keep everybody working. And that spins a tightrope ive been walking. And it kind of feels like breathing with a noose around your neck. Lemonis which is not very easy. Lady no. Lemonis and when you had 13 stores, where was the office for merchandising, inventory management, accounting, i. T. . Where was all that . Lady i live just right outside of aspen, colorado, and so its there. Lemonis why do you live there . Lady my husband got a job there. I have two kids now 3 and 5. Lemonis and is there a store there . Lady there is not a store there. Lemonis lady was literally like a horse out of the barn, Opening Stores all over the country with no research, and she doesnt even live where one of the stores exist so that she can see the product, talk to the consumers, listen to the customers, see whats selling and not selling. No wonder this place is in total chaos. When you source inventory, who buys all the inventory . Lady currently, i do. Lemonis and then, who does the merchandising . Lady the store managers. Amys been with us since 2010. Lemonis youre the manager here, amy . Amy yeah. Lady tashas been with me since 2007. Lemonis tasha, what do you do . Tasha im the director of sales. Lemonis who does the ordering . Lady i do. Lemonis so let me understand that tasha, what do you do again . Im sorry. Tasha i manage the managers within the stores. Lemonis three stores. All store managers, they report to you. Tasha mmhmm. Lemonis and you report to her. Tasha correct. Lemonis and so what are you working on . Lady so i work on the debtmanagement. Lemonis i subscribe to the theory of very flat management. In this case, there should be three store managers, and they should all report to the owner. But im not really sure why lady put this other layer in between her and the stores. Tashas not merchandising. Shes not buying. Shes not hiring the people in the stores. What is she actually doing . Is your name really lady . Lady so, yes, and actually my mother was named lady. So. You know, my mother passed away when i was 9. And she took her own life. She left me money, and i wanted to do something with her money that paid homage to her and i think, on some much deeper level, prove to myself that my life was gonna be different than hers. [ voice breaking ] and now im gonna cry, but, you know, im turning 40 next year, and she killed herself when she was 43. And i think i always felt like, um. That this business would be so successful by the time i reached her age. [ sniffles ] im not a quitter. [ chuckles ] and i cant let go of being able to. Figure it out, you know . Lemonis this is a very strong woman who took a lot of risk in opening up her own business. But its obvious to me that her mothers passing is affecting her ability to make decisions that arent overwhelmed with pressure. Im sorry to hear about your mother. Lady yeah, no, thank you. Im sorry to cry about it. Its just its personal. Lemonis no, i can relate. Listen, my mother died recently, and so i kind of get all that. And the fact that you feel the pressure to not fail it makes sense. Lady yeah. Lemonis i still dont have enough information. I really need to look at the financials. Hello. Lady hi. Lemonis how are you . Lady good. Good to see you. Lemonis there are a number of really big issues here. Theres anemic inventory. Theres layers of management. The margins are horrible. I mean, the list could go on and on. You couldnt have picked a better setting. Lady i know. [ chuckles ] i feel like hes about to give me a rose. [ both laugh ] lemonis right . It feels like that. Lady while were sitting in this romantic spot. [ both laugh ] youre blushing. See . Lemonis um. What i wanted to do is actually just go through the numbers with you. Lady okay. Lemonis you went from 13 stores to 3 . So lets look at the p l. 3,145,000 in sales. Business lost 10 grand. Lady yeah. Lemonis and thats because you lifted all the bad stores out. Theres three stores left. They generate over 3 million of business, which is a heck of a job. Lady right. Lemonis especially considering that the inventory is anemic. So, a negative balance in all the checking accounts . Lady yeah. Lemonis okay. So the total assets with inventory that you own 166,898. 1,603,000 of liabilities. Lady mmhmm. Which is made up of 865,000 in payables to vendors. Lady all payables to vendors. Lemonis 50,000 in credit cards. And 688,000 in line of credit. And that line of credit you said you personally signed for it . Lady yes, and i pledged my assets towards it. Lemonis and what are those assets again . Lady its portfolio old, like, bluechip stocks. Lemonis and thats what your mother left . That was your inheritance . Lady yes. Lemonis if everything goes bad. Lady [ voice breaking ] my creative spirit is invested in this business, and, for three years, ive been not being the best mom or the best wife because im consumed by fixing this problem. I would like to take this business to the next level. Its very hard to have a business where people feel it. Its the juju. And we have it. Lemonis that juju that you talk about thats actually you, to be honest with you. You basically started a business by rubbing two sticks together. Lady [ laughs ] lemonis right . Lady yes. Lemonis and so, i want to make an offer. Lady okay. Lemonis and so, my offers 800,000 for 50 of the business. That 800,000 will be used to clean up the situation with the vendors, pay down the bank significantly, and put money in the bank for working capital so that we can have inventory for everybody. Lady you know, im thinking that, to me, the equity piece is really important mainly just because i spent so much time, blood, sweat, and tears in this company. Lemonis okay. Lady i think my counter would be. But raise you to 1 million. Cate i assumed the storemanager role. Lemonis whens the last time you saw lady . Cate i havent seen lady in six years. politely wait, wait, wait you. You have to rinse it first. Whats that, alfredo . No, that can go in. No it cant what are you, nuts . Thats bakedon alfredo. Bakedon . Its never gonna work. Dish issues . Trust your dishwasher with cascade platinum. It powers. Through. Your toughest stuckon food. Better than finish. to the hostess see, told you it would work. turns to girl 2 you heard me say that, right . Cascade. The tougher toughfood cleaner. Working on my feet all day gave min my knees. But now, i step on this machine and get my number which matches my dr. Scholls custom fit orthotic inserts. Now i get immediate relief from my foot pain. My knee pain. Find a machine at drscholls. Com father, why cant we have directv like the macgregors do . Were settlers, son. We settle for things. Like having cable instead of directv. Hey, jebediah, hows it going . Working the land. Hoping for a fertile spring. All right. So we have to live with lower Customer Satisfaction . Im afraid so. Now go churn us some butter, boy, and then make your own clothes. Yes, sir. vo dont be a settler. Get rid of cable and upgrade to directv. Call 1800directv. Lemonis and so my offer is 800,000 for 50 of the business. Lady i think my counter would be if you could take 40 of the company but raise you to 1 million to satisfy the vendor debt specifically. Lemonis the vendor debt could be worked out with a much lower amount. Lady it can be worked t. I hear you. Lemonis so your 865,000 could be for maybe 10 or 20 cents on the dollar. Well, thats 160,000. Lady yeah, so, i could come back down to 800,000, but i think i really need to do 60 40. Lemonis why is the 50 hanging you up so much . Or is it you still want to have more than me . From a creativity standpoint, you trump me by 100. From a control and process standpoint i feel like thats my strong suit. I bring value. You bring value. I want us to be the same or nothing. So, my offers 800,000 for 50 . Lady no 900,000, 50 50 . Lemonis whos determining what happens with the 900,000 . Lady you are. Lemonis ill put the extra 100,000 in because i know that i own 50 of it, and im controlling how the money gets spent. Lady im really happy to be your partner. Lemonis thank you. Lady and i feel like its right. Lemonis so we have a deal . Lady we have a deal. [ laughs ] lemonis congratulations. Lady congratulations to you both of us. Lemonis and dont forget im 100 in charge. Lady [ laughs ] i know you are. Im excited. Lemonis good morning. Lady and i had dinner last night, and we made a deal for me to invest 900,000 into the business. Amy [ chuckles ] nice. Lemonis and im 100 in charge. So the 900,000 that im putting into the business is gonna be used to solve three primary things bring inventory in, take care of the vendors that supply us, and were going to pretty significantly change the look of the store. And as we kind of remerchandise the store, were going to pick products that we think are easy boltons, easy upsells. We want to make sure that everybodys in the appropriate role. And i think, tasha, the question that i have if youre in dallas. Tasha correct. Lemonis . Why is there a store manager and you . Why all these layers . Tasha well, i think, one, i do some of the training. Its a whole mix of things that i do. Lemonis i want to really dig into that. Tasha yeah. Lemonis the problem with this business is that when this company shrunk from 13 stores to 3 stores, the Management Structure didnt shrink with it. So, theres lady, whos the owner. Theres tashas position, whos the director of sales, who oversees the managers. Then theres the managers who have assistant managers and floor managers and salespeople. We got to flatten that out. That is too many layers of management. What do you guys think the biggest challenge for lady is gonna be . Amy getting used to you. Tasha yeah. [ laughter ] lemonis i have a feeling you and i are gonna. [ laughter ] lady giddyup. Lemonis all right, lets go to work. I live in chicago, and so while i was home, i decided to visit the blues jean bar on halsted street unannounced. The employees think the cameras are there only for basic footage. They dontnow im coming. And right away, i notice a dirty storefront and a dirty awning. It wasnt good. Hi, guys. Welcome. Let us know if you need help with denim. Man these in a. Katelyn 33. We do not. We only have a 34 and a 38. I know. Lemonis just like in San Francisco, they didnt have enough inventory. Customers are asking for things, and they dont even have their sizes. Katelyn unfortunately not right now. Our shorts are kind of limited. Lemonis i noticed this shoebar area, and it was just boxes piled up, merchandise all over the place. From a presentation standpoint, theyd get an f. What is your name . Cate im cate. Nice to meet you. Lemonis marcus. Cate marcus. Hello. Hello. Lemonis nice to meet you. Cate welcome to our store. Lemonis thank you. Did you know lady and i made a deal for 50 . Cate yeah. Lemonis how long have you been here . Cate six years. And i assumed the storemanager role four weeks ago. Lemonis and so who do you report to now . Cate i answer to tasha. Lemonis how often does she come . Cate i have not seen tasha for over four years. Lemonis and how about lady . Cate i havent seen lady in six years. I know she has been to the store in the last 12 months, but i have not seen her. Lemonis happened to be a day you were off. Cate yeah. Katelyn ive never met lady. And the roles of everyone is very confusing. Lemonis im definitely frustrated with the fact that tasha hasnt been in these stores managing these people. But if i was gonna hold one person accountable, it would be lady, the woman who owns this business. She should be setting the direction. Nice meeting you. Katelyn you, too. Lemonis it was really nice meeting you. Morning, guys. Cate hello. Lemonis how are you . After seeing what i saw in chicago, i called lady, and i told her that her and tasha need to come and bring amy cause what ive seen, i dont like. I want to know what the hells going on around here. I know you havent been here in a while. Lady i havent. Lemonis and why is that, by the way . Lady you know, i have been working on cash and keeping, sort of, the lights on. Lemonis i came to this store yesterday, and, you know, it raised a lot of questions for me. Seeing the dirty windows and the dirty awning and i would bet that the reason it looks this way is because it feels unsupervised, underresourced, underloved. And its a reflection of you, and its a reflection of you. And so, while i really like cate, the store doesnt look great. So who came here to train her for that job . Tasha well, i mean, i talked to cate extensively on the phone. Lemonis cate, how often do you get the Financial Performance of your stores, like whether it makes money or doesnt make money or the margins or how much inventory you have . Cate i do that on my own. Lady all of our managers have a lot of ownership in their stores, which i dont think is necessarily a bad thing. Lemonis im starting to understand the dynamic here. Now, clearly, tasha is failing her store managers, but, in my opinion, lady is failing tasha. These employees have been given the freedom to do whatever they want, and in the absence of leadership, particularly from lady, people are gonna do whatever they have to to make it work. And its obvious to me that, just like San Francisco, this place doesnt have enough inventory. Is there inventory downstairs . Cate sure. Lemonis lets go downstairs. And so i ask them to take me down to the basement, hoping that theres actually more inventory. Lady a lot of this stuff just all needs to be liquidated. More backstock. Lemonis this basement is a disaster. And my bet is that there was tens of thousands of dollars worth of inventory here. And whether it was oddball shoes or shirts or blouses, it feels like a warehouse of odd clothes that dont belong upstairs. This is the most irresponsible use of cash that ive ever seen. This is a good example of a reason you couldnt visit stores. Lady you are correct. Lemonis whats in the next room . Lady a zillion more of those. Lemonis mmhmm. What down here actually sells, tasha . Tasha i dont know. Katelyn i dont know how were gonna sell this. That was my first instinct. Like, chicago people arent gonna buy this. Lady what are you thinking . Lemonis im not sure who to be pissed at myself for doing the deal. Or you guys for letting the stuff just sit there. But at this point, we need to figure it out. I need more floor space. Guillermo this is going to go. Lady no. If we take the bar out, then were just gap on steroids. Ever since i had a pretty bad accident three years ago. The medical bills the Credit Card Debt all piled up. I knew i had to get serious my credit. So i signed up for experian. They have real, live credit experts i can talk to. They helped educate me on how debt affected my fico score. So i could finally start managing my credit. Now my credit and i are both healing nicely. Get serious about your credit. Get experian. Go to experian. Com and start your credit tracker trial membership today. 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Lemonis im not sure who to be pissed at, but at this point, we need to figure it out. So were gonna start to define some roles. Are you ready . Youre responsible to get rid of everything we determine today. Is never gonna last. Tasha okay. Lemonis by the way, thats the stuff down here. Were gonna go downstairs and pick some other stuff. Tasha okay. Lemonis this mountain of inventory doesnt just tell me that theyre irresponsible with cash, but it tells me that they dont know who their customers are and who theyre buying for. And were gonna solve that right now. Were gonna define our profile right now. What is our profile . When you built this company, who did you want the shopper to be . Lady me. A woman between the age of 35 to 55, a woman that has disposable time and income, like a soccer mom. Katelyn that just isnt i dont think who we should target in this neighborhood. Amy id say a little younger. Lemonis Young Professionals . Cate lincoln park is primarily Young Professionals. Lemonis so 25 to 40 . Katelyn yeah, 25 through probably 40. Lemonis this is a good example of what got you in trouble when you opened stores. Lady yeah. Lemonis if youre picking what you described, you picked the wrong location. This is not the neighborhood for the demographic youre looking for. I want to go through the store and figure out what wont sell here. 25 to 40 years old. Lets be aggressive about it. Right now, were getting rid of everything that doesnt work for our demographic in the chicago market. After we get a handle on chicago, were gonna do the same for dallas and San Francisco. Amy what do you think about this . Lady no, hate it. Amy hate it . Lemonis 25 to 40 . Yes or no . Cate i think theyre too oldlooking. Lemonis yes or no . Tasha yes. But i think we should be choosier on the colors. [ shoes clatter ] lemonis this is basically a room full of mistakes and desperate buying without a plan. There is so much wasted inventory and so much bad product in here. This is why data and research are important. Amy i like the rainbows. Lemonis amy, are you reordering this . Amy hell, no. Lemonis after going through the store, i realized that over 70 of the merchandise wasnt gonna sell. And i wasnt gonna sit around for it, so i made an immediate decision to liquidate it right then and there. Come on in. Liquidation sale. 5 jeans. Jeans are 5 and 10 bucks. Stores closing. We were able to clear 15,000 worth of merchandise. Im going to reinvest the 15,000 into brandnew inventory, and im gonna look for a 70 margin. In order to do that, im gonna have to sell the product for 50,000, yielding me a 35,000 gross profit. I know that ill be able to do that four times a year, so on an annual basis well have 200,000 worth of revenue and 140,000 worth of gross profit. From doing what . Clearing out the basement . Its not that hard. How are you . Lady great, how are you . Lemonis good morning. Lady hi. Good morning. Lemonis looks a little different in here. Lady yeah, it looks better, doesnt it . Lemonis ive decided to make the chicago store the model for the other locations. Good seeing you. Guillermo nice to see you. Lemonis i brought in guillermo, a designer who understands how to lay out interior spaces. My goal is to maximize every square inch of this place and add more fixtures and more product, allowing for more revenue to be generated. What im looking to do is change the entire store. I feel like i need more floor space a lot more floor space. Guillermo this is gonna go. I mean, were. Lady no. Thats really a place to display the jeans. Guillermo i think its a little too big for the store. Lady i mean, i just think show the jeans to the customer and, like, show them the fabrics. I want the bar to be a main feature. Lemonis youve taken up a lot of space with a dead shoe bar that could have been a cashmere corner. Lady well, what if you had the bar, but you could have, you know, more access . I dont want someone to walk in and think, im in a cashmere store. Lemonis youve taken up a lot of nice display spaces down the middle of the aisle because i have this big piece of wood. Her ability to upsell is minimized because shes back there. What is she gonna do . Keep coming in and out . Lady can we step back for a second, and can i ask you if we take the bar out, then were just gap on steroids. Were just a white box. I feel like the reason why this store is so cool is because we have the bar. Lemonis but it didnt work for this business. You opened up 13 of them, and they didnt work. Whats the one thing that you would say youre not willing to compromise on . Lady i think the soul of the store. Lemonis the soul of the store is the most important thing . Lady i think so. I mean, the specialness. Lemonis its obvious to me that lady is struggling to let go of the bar because thats how she started the business. But we cant be managing this business from the rearview mirror. We have to be looking forward. The store is shutting down for remodel and a rebrand. Lady okay. Lemonis and we will reopen, and it will be big and bad. Its gonna take about 30 days to renovate the chicago store, and so im sending all of the good inventory to dallas and San Francisco. But the bad inventory thats still in the basement well, i asked tasha to get rid of that days ago. And its still here. Why isnt it gone . Tasha i think ive just been engulfed in doing a lot of different things. I could have done better, but i also thought if i had better tools and more direction. Lemonis you know, in the position that youre in right now, dont you think you should be coming up with the solutions on a daily basis . Tasha well, right. Lemonis tasha seems very confused about her role, like she doesnt know what to do. And ladys just standing there with nothing to say. If youre responsible for the three stores, if thats your job, tell me why San Francisco is a mess, chicago is a mess, dallas i dont know. Im assuming its the same. Tasha i failed at my job, you know . [ sniffles ] i failed. [ sniffles ] lemonis i think i have a video of what the chicago store looks like right now. Lady oh. Oh, my god. Wheres the bar . Wopen up a lot of dawn. Tough on grease. Yet gentle. Dawn helps open. Something even bigger. Go to facebook. Com, dawn saves wildlife. This bale of hay cannot be controlled. When a wildfire raged through elkhorn ranch, the sudden loss of pasture became a serious problem for a family business. Faced with horses that needed feeding and a texas drought that sent hay prices soaring, the owners had to act fast. Thankfully, mary miller banks with chase for business. And with greater financial clarity and a relationship built for the unexpected, she could control her cash flow, and keep the ranch running. Chase for business. So you can own it. 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Ask your doctor about cialis for daily use. Insurance coverage has expanded nationally and you may now be covered. Contact your health plan for the latest information. You cant breathed. Through your nose. Suddenly, youre a mouthbreather. Well, just put on a breathe right strip which instantly opens your nose up to 38 more than Cold Medicine alone. Shut your mouth and say goodnight mouthbreathers. Breathe right we broabout this new car. To get your honest opinion to keep things unbiased, we removed all the logos. Feels like a bmw. Reminds me a little bit of like an audi. So, this car supports apple carplay. Siri, open maps. She gets me. Wow. It also has teen driver technology. It even mutes the radio until the seat belts are buckled. Im very curious what it is. This is the 2016 chevy malibu. And it sells for . It starts at twentytwo five. What . Oh wow. I mean with all this technology. Thats a game changer. Lemonis hey, tasha . Tasha [ sniffles ] sorry. Lemonis no, no, its okay. I think, at the end of the day, you know, i think that there definitely has been a failure. Tasha yeah. Lemonis if youre in that position of authority, you have to come up with solutions on your own. Tasha right. Lemonis and just because the house is burning down, you cant wait for her to figure out how to put the fire out. Tasha yeah. Lemonis and these girls in the stores, i think, have a lack of respect because they feel like you abandoned them. Tasha because i cant do everything. Ive done everything for a really long time, and it obviously doesnt work. Lemonis or you could be just, you know, getting back to basics. Tasha yeah. Lemonis i know that tasha thinks that shes working hard, but i need her to work smarter, not harder. So we just have to figure out whats the right strategy going forward, and whats the right position for everybody . With the chicago store closed and ready for remodeling, i want to get a head start on new inventory. So, im taking lady and amy to aviator nation in los angeles to set up a wholesale account. My goal is to buy a small collection of products that go well with jeans for 25 to 40yearolds things thatll be a great bolton to the jean purchase. Paige the cool thing about aviator nation product is its all made here in l. A. Amy i was saying to lady a while back that we need to carry more hoodies and whatnot, especially in San Francisco. Lemonis if jeans are the primary product and they come with a 50 margin, im looking to have the balance of the inventory be products that can go with jeans but at a much higher margin. So thats 164. 99. Paige yes. Lemonis so if we had a price of 165 and we wanted to make a 65 margin, that would come in at around just under 60. Paige right. Lemonis but the larger commitment we make, obviously thats gonna help the relationship and the price. Paige yeah, absolutely. Lemonis does that work in your mind . Lady yeah. Lemonis while were in l. A. Looking for new products and new ways to grow our business, back in chicago, theres an entire demolition crew basically gutting the place. Hello. I heard from lady that she had a few important things that she wanted to discuss, so were gonna meet for some lunch. Lady its been hard for me to vocalize my whole feeling about the bar and why its special. The bar makes us very different as a retailer. I dont want us to turn out to just be a common retailer with a lot of clothes in a store. I want the personal connection there, and i want a format in a store that aids that. Lemonis i think i have a video of what the chicago store looks like right now. Let me see if i have this. Lady oh. Oh, my god. Oh, my god. Wheres the bar . Lemonis the bar is gone. Lady this makes my heart hurt to watch it. 10 years of, like, that store being the way it was, and, um. Its just hard. Lemonis im intentionally changing things to the extreme so that it feels like a new day. Im doing it on purpose. Lady yeah. Lemonis the bars taking up valuable display space for tables and racks that will allow us to sell more merchandise. Lady its a process, like Everything Else the lettinggo piece. Lemonis today, im meeting lady and tasha back at the San Francisco store. I wanted to find out how they did with all that extra inventory we set up. So, the stuff that came from chicago whats happened to sales . Amy they went up. Its like a 16,000 difference. Lemonis the wall looks a little better. Amy it does look better. Tasha okay, so, one, i wanted to let you know who did the org chart for the whole company. So, uh. Od job, tasha. Lemonis no, i just want to study it for a minute. Tasha okay, yeah, go ahead. Lemonis sorry. I had urged tasha to get back to basics when thinking about her role. Instead, she shows me an organizational chart making herself the chief operating officer. It felt like i was running some fortune 500 company. We have a president and a founder. This nonsense stops right now. Hey, lady, come on over. So were going through this. Lady uhhuh. I just had some questions. And so every store has a store manager and a floor manager. Lady we dont have a floor manager in dallas, and we havent mainly because tashas been so involved there. I think, because were so small right now, tashas role can be the dallas manager for now. Lemonis hows that sound to you . Tasha it sounds okay. Lemonis just okay . Tasha im not, like, superexcited about it. I think it still can be up for discussion. Lemonis if your business is in trouble and you need my help, log on to theprofitcasting. Com. That reminds me. Anyone have occasional constipation, diarrhea. Gas, bloating . Yes one Phillips Colon Health probiotic cap each day helps defend against occasional digestive issues. With three types of good bacteria. Live the regular life. Phillips. cell phone rings where are you . Well the squirrels are back in the attic. Mom . Your dad wont call an exterminator. Can i call you back, mom . 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Imagine life with a lower a1c. Are you loving your numbers . Theres only one invokana®. Ask your doctor about it by name. I think, because were so small right now, tashas role can be the dallas manager for now. Lemonis hows that sound to you . Tasha it sounds okay. Lemonis just okay . Tasha im not, like, superexcited about it. I think it still can be up for discussion. Lemonis what turned me off was her giving me the impression that she was above being a store manager. How could you be a leader if youre not willing to do the job with the people . Like, who do you think you are . The store managers, to me, are the most important position in our company because they control our assets, they manage our brand, they take care of our customers. I really want you to have that mentality. Tasha im not saying i dont like to be on the floor anymore. Its just i havent been on the floor in a really long time. I actually feel like it would kind of be a demotion for me. And im just being 100 honest. Lemonis heres the problem that im having. This c. O. O. Role overseeing the three stores is no longer going to exist in our company. With three stores, they need an owneroperator and the store managers, and thats it. Tashas role is a question mark for me. I just dont know what it is. I dont know, tasha. I really dont. Im being honest. Lady were not gonna get rid of tasha. Were getting rid of this position. Lady that position but not her as a person. If it hadnt been for tasha, i wouldnt be here today. And so i think thats superimportant to acknowledge that. In my opinion, we need to put you somewhere that makes sense in the org chart, but we also need to make sense of the entire org chart without all the existing layers. And the obvious place is for you to be the dallas manager for now. You know, this is not a demotion. This is not a reflection of your character. So were gonna have you be the dallas manager and take the c. O. O. Role completely out of the equation. Lemonis im wondering where the hell youve been up until this point. For the first time, lady finally took a stand. Shes actually putting tasha in the right role. Its about time. Lady so, i think two options of having you outside of the organization and not staying with us or staying with us as the dallas manager. I think its a position of just getting back to basics. Tasha i mean, thats fine. Lets take the demotion, this or that, if thats what i need to do. And we will kick ass. I will sell the. Out of everything like i normally do, like i did before when i got promoted. Im still gonna give 150 to make that store the best it can possibly be. Lemonis i think your attitude about respecting the importance of this storemanager position and all of those things and proving yourself is exactly what i wanted to hear an hour ago. When you see it, i really want you to think about moving forward. Its time for me to show lady the new look of the store. Not only has it been completely renovated, but ive also changed the name. Im gonna take you this way. For me, it represents a fresh start with lady not looking back anymore. Ready . One, two, three, four, five. Lady holy [bleep] [ gasps ] oh, my. I dont even have words. Look at the name. Lemonis the reason i came up with the name denim soul is because, several times throughout my time with lady, she talked about not taking the soul out of the business and that we were gonna put in things that had personality and flavor but that would also give us good margin. To me, soul equals margin. Lady well, you didnt take the soul out of the business. [ chuckles ] oh, my god, wait, thats new orleans the backdrop. Lemonis yeah. Lemonis thats new orleans. And thats chicago. Lady chicago. Lemonis and so the goal in every market is to pay homage to the local market but to never forget where you came from, without it being, like, so inyourface. Lady can we go inside . Lemonis yeah, we can go inside. Lady oh, my god. Oh, my god. One. Is all it takes. To turn the tables. Crest 3d white toothpaste. Removes 5 times more stains. Than the red box. For a smile like that, crest 3d white. Is the way to whiten. I have a massive heart attack oright in my driveway. D the doctor put me on a bayer aspirin regimen. Be sure to talk to your doctor before you begin an aspirin regimen. Go talk to your doctor. Youre not indestructible anymore. Now mother, we are settlers. O directv . Ive settled for cable all my life. But directv has been number one in Customer Satisfaction over cable for 15 years. We find our satisfaction elsewhere. The boy has his stick and hoop. The girl her faceless doll. And you have your cabbages. And you. Have your foot stomping. I sure do. vo dont be a settler. Get rid of cable and upgrade to directv. Call 1800directv. So strap yourselves in for action flo Small Business edition. Oh, no im up to my neck in operating costs ill save the day for plumbers and bakers and scapers of lawn, shes got insurance savvy you can count on. You chipped my birdbath now youre gonna pay not so fast i cover more than just cars and trucks. Action flo did somebody say insurance . Children flo action flo cut can i get a smoothie, please . Ooh they got smoothies . For me. Lady can we go inside . Lemonis yeah, we can go inside. Lady oh, my god. Oh, my god. It doesnt even look like the same store. Lemonis when lady saw the interior of the store, she was blown away. This was literally changing the floor plan, putting a lot of thought into how customers circulate through the store, bringing in all new fixtures, something hip and fun, changing the lighting that will brighten up and lighten up the store, changing the floors to give it a fresh, new look, bringing in products that complimented the jeans, like a onestopshop casual environment. Lady theres a jean bar. [ chuckles ] lemonis its not a jean bar. Lady [ laughs ] lemonis its a table that you can walk around. Lady its a bar. Come on, marcus. This is a bar. Lemonis its a table. And the purpose of this table ill call it a bar if it makes you feel better is to be able to take a pair of jeans, like these, and lay them out. Our inventory has close to tripled. We used to carry around 30,000 of denim on one wall, but its now closer to 75,000 with more sizes and more cuts. I have something really special to show you. Come over here. I told you that i dont want you to forget things. And so. Lady [ crying ] i think that, you know, this whole process has just let me be, instead of embarrassed about my past, feeling, like, literally honoring her through this process. So thank you so much. [ laughs ] lemonis the good news is that, with the debt being paid down and the stores now having the right merchandise, the ability for lady to pay off all of the debt is significantly greater, allowing her inheritance to finally be released from the bank. Now, i want to show you things. That and all this stuff and all this stuff, from the bikes theyre all skus. And so the goal over time is half of the place is denim, and the rest of it is soul. And so, from a business standpoint. Lady love that name. Lemonis right . Its so cool. Lemonis you do like the name . Lady love the name, yeah. And i could not have created a store that was this modern with a personality, and you all did it. For me, learning to trust the process was probably the biggest challenge of all of them. Lemonis you kind of sucked at it. Lady [ laughs ] lemonis . In the middle. You got better, but in the middle, you were lady but for me, this process will be, without a doubt, the biggest, most lifechanging event ever. Lemonis thank you. Lady thank you. [ chuckles ] thank you. Lemonis can you do me a favor and start organizing [bleep] so we can invite some people in and sell some stuff . Tonight is the grand opening of denim soul. Lady welcome to denim soul. And doesnt it look amazing . Lemonis five weeks ago, i made a deal with lady. There was debt and disorganization. Today, the first of the three stores has been renovated. And weve created a model and template to use going forward. Katelyn so we have all sizes, which is awesome. Well have all sizes constantly. Lemonis what do you think . Woman its awesome. I was here a while back, but they didnt always have my size, and ive found multiple pants already in my size. Lemonis you did . Woman yeah, the selections incredible. Lemonis very cool. Lady you used to not be able to come behind the bar, but now you can, so come. Im so happy. Lemonis the new layout really allows the customer to circulate around the whole store. Before, the jeantender was the only one that can control the whole process. Tasha so, a, you can kind of, like, feel the product now. And then im gonna pull you a couple things that i think that youll like. Lemonis it is so great to see tasha on the floor. Shes engaged. Shes working with customers. Shes helping the staff. Im feeling like we made the right decision. Man okay. Tasha do you like it . Man i do. I do. Tasha yeah, lets try that. Lemonis historically, the blues jean bar had 50 overall store margins because it was primarily made up of blue jeans. Usually, 70 of the store had denim in it. With the new layout and the new merchandising plan, over 50 of the merchandise will be bolton items like tshirts and blouses. These are items that will come with a much higher margin, raising the overall profitability of the store by about 10 . Man thank you so much. You have a good afternoon. Woman thanks. Lady so, can i get everyones attention . Welcome to denim soul, which is a new name for us. Yay. [ cheers and applause ] and thank you guys so, so, so much for being here. For me, personally, this has been a dream come true. If you havent met marcus, which many of you have major thank you to him because without him, you know, [ voice breaking ] a lot of peoples dreams not just mine wouldnt come true. And so thank you so much. Lemonis when i first met lady, i was very concerned about her ability to move on from the past. And i understand that the tragedy of her mothers death really weighed on her. But over the process, i really saw her evolve as not only a person but a businessperson. [ glasses clink ] and so because of that, im very excited about the future with her. Lady good night. Narrator this is the shark tank, where hopeful entrepreneurs get a onceinalifetime chance to pitch the sharks in hopes of getting an investment to start, grow, or save their businesses. Weve done 5. 8 million worth of sales. Babam narrator the entrepreneurs must convince a shark to invest the full amount theyre asking for, or theyll walk away with nothing. Bam whats the answer . I will do anything it takes. Thats not the right answer. You are going to die a horrible death. Narrator if the sharks hear a great idea. I love the product. Its genius. Whoo . Theyre ready to invest using their own money. Ill do the dance, but at 25 . Whoa. Narrator and theyre willing to fight each other for a piece of the action. Its a teensy, weensy, cockroachbaseball league. Its a 6billionayear industry. Thats poopoo. You are not an entrepreneur