Were closing the store. Were done. Im not talking about it anymore. I back them up, spending my own money. Its not always pretty. Man perfect flavor. Lemonis . But this is business. You got to trust the process. I do it to save jobs, and i do it to make money. Thanks for your business. This is the profit. Coopersburg, pennsylvania is about an hour north of philadelphia, in the heart of Amish Country. And its home to coopersburg sports, a noveltyandsports business. Scott pino started the business in 1991. Scott i cant find the yankee order out here. Lemonis . Shortly after he secured the coveted license from Major League Baseball. He eventually was able to place his mini bat, his top seller, in every Major League Baseball park. Business was great, and they were pulling in over 4 million a year and making a hefty buck. But in 2008, a major sportinggood company entered the novelty game, and almost immediately, coopersburgs business was cut in half. Today the Company Operates in a facility thats outdated, using a process thats pure chaos. Scott were supposed to have 3,000, which is what the orders for. Ben whoever pulled it didnt put it on the Inventory System. Lemonis while scott recently brought his kids, jackie. Jackie dad lemonis . And ben to help run the company and bring in a fresh perspective. Jackie can we talk about sales goals . Scott [ sighs ] i got to get this done today. I mean, i dont have time. Jackie whatever. Lemonis . Scott is reluctant to let them make changes. Ben theres batteries that have been sitting there for five years. Lemonis . And sales continue to slide. Ben what are we doing with those . Jackie we need to get our. Together. Lemonis if i can get coopersburg sports on the right path, we will definitely knock it out of the park. I wouldnt call coopersburg sports one of the more organized facilities ive ever seen. There are boxes stacked everywhere. Theres a fair amount of manufacturing going on, but theres no flow, no process. Quite frankly, theres no rhyme or reason to any of it. Its obvious to me there is no ventilation. How are you . Scott whats happening, buddy . How are you . Scott. Nice to meet you. Lemonis im marcus. Nice to meet you. So, tell me a little bit about what you do here. Scott we produce all kinds of licensed products for Major League Baseball. Baseballs probably the bulk of what we do. Lemonis how much total revenue were you doing . Scott our best year was about 4. 38 million, and were way down. Its like 2. 2 million. Lemonis okay. Scott and thats been part of the problem a number of Different Things the economy, a major competitor whos really stolen a lot of our business. Lemonis whos the major competitor . Scott Louisville Slugger. Itd be like you selling rc cola going up against cocacola. Lemonis right. Show me the product that youre making. Scott this is an 18inch miniature bat with a fullcolor, heattransfer logo going to the mariners. Lemonis and who makes the bat . Scott the amish and the mennonites. This is the basic item thats in every majorleague stadium. Its in los angeles dodgers, its in new york yankees in all 30 parks. Lemonis the reason im here is because scott has a relationship with Major League Baseball, and hes got his product in all the parks. Quite frankly, i dont even know if Louisville Slugger is in all the parks. Its kind of a big deal. For me, im trying to understand the economics of everything, and so, a bat like this, for example what does this cost you . Scott including the royalties, about 1. 15. Lemonis okay, and then what does it cost to add the logo onto it . Scott 20¢ at the highest level. Lemonis so, thats 95¢. And then how much are you paying mlb on a bat like this . Scott 12 , so 18¢. Lemonis and so 95¢ and 18 1. 13 . Scott 1. 13. Lemonis and what do you sell this thing for . Scott for around 1. 50. Lemonis so youre making 37¢ on this bat. Thats not great. Scott its not. Its a terrible margin. Lemonis why do you paint these in house . Scott in case we run out of a certain color. Lemonis and what about the waste . Scott the waste is minimal probably 12,000. Lemonis waste in manufacturing is when you create products that have mistakes on them, but the costs associated with those mistakes are sometimes hidden. And so, while scott tells me that the loss is 12,000, hes only counting the materials themselves. Hes not factoring in labor, the lost time to buy the product a lot more than 12,000. If youre telling me that its a 1. 13, if i source this bat, logo already on, whats it cost . Scott 85¢. Lemonis including the royalty . Scott no. Lemonis so its only 10¢ . Scott maybe 10¢. Lemonis thats the difference . And how many bats a year . Scott 300,000. Lemonis there are two specific reasons that i want to bring in the bats already painted. One, i can save 10¢ per bat if we do it. Across 300,000 bats, thats 30,000. In addition, the 12,000 in waste that its costing the company per year. Thats 42,000 reasons to not paint the bats in house. But this building has its challenges. Scott i inherited the building. My dad bought the building and the property and the business. Lemonis so, your dad started this company . Scott he bought the company. Lemonis what kind of business was this when he bought it . Scott it was a handleturning company tool handle and that was a very big business until power tools kind of put us out of the business. After owning the company for three or four years, we discovered the bat business as a result of the handle business because Major League Baseball players came here in the 50s to buy bats. At that point, we contacted Major League Baseball and told them the story. Lemonis so, you turned a toolandhandle business into coopersburg sports. Scott coopersburg sports a baseballbat manufacturer. Lemonis kind of a cool story. Scott its a very cool story. Lemonis in order for a Small Business to be successful, its gonna have to evolve and transform. And years ago, scott was able to do that when he turned a handle company into a baseballbat company. But if hes not able to go through that same transformation again and come up with some new products, i dont know if he can make it. Im fascinated by this because it doesnt look like a sticker heatpressed. Scott we have an exclusive deal for the life of the patent to produce it on miniature baseball bats. Lemonis lets go see the rest of the place. Scott all these printers are hewlettpackard printers that have been converted to print baseball bats. The printer thinks its printing paper its printing a bat. Lemonis you basically rigged this machine. Scott its amazing. Lemonis how you doing . Im marcus. Dylan good. How are you . Dylan. Lemonis nice to meet you. Dylan nice to meet you. Lemonis is this done . Dylan yeah, that ones done. Lemonis is this the only product that you print this way . Dylan i mean, weve never printed really anything else on printers other than bats. Lemonis people like to buy products that are personal to them, whether its their Favorite Sports Team or family reunions or their favorite personality. And so anytime you can take a basic product and customize it, youre going to get a lot higher margin. And thats whats gonna make this Company Money in the long run. Wendy you have 300 boxes for 1,500 pennants. Were probably gonna lose about 10,000. Jackie this is the fifth time this has happened this week. Scott this is my daughter, jackie. Jackie ill call them back. Hi. Nice to meet you. Lemonis hi, jackie. Im marcus. Nice to meet you. Jackie thank you so much for coming. Lemonis so, what do you do here . Jackie i was hired to mainly handle the collegiate market and sales, which i am doing on top of, like, [laughing] 30,000 different other things so. Lemonis and so why did you get spread so thin . Jackie i really wanted to take a lot of his plate cause i think that was the problem. Lemonis he has too many hands in everything . Jackie yeah. Lemonis shes nicely just telling you that youve jacked things up around here, and shes putting law and order in place. Jackie it needed to happen, though. Scott shes helping me a lot. Lemonis what would be your biggest complaint . Jackie i hate having to chase my order all the time and wonder where it is. Lemonis from the inbound call to taking the order to the process, theres nothing that tracks that whole process . Jackie nope. Scott program we need is very expensive, and we cant afford to buy it. Its 30,000. Lemonis its expensive, but you also cant afford to not have it because if youre not delivering on expectations, then you lose that customer. Next question how do you track all this inventory . Jackie thats something i need to talk to you about. We have a problem. How did we not realize that we wouldnt have enough boxes to fulfill the order . Lemonis how many are you short . Jackie about 1,200. Lemonis if you dont have an ordertracking mechanism, customers either arent gonna get their order filled, or theyre gonna cancel it halfway through. Its a lost opportunity, and lost opportunity is lost money. Scott and this is how the bats come in from the mennonites, from the amish. Some of the equipment, we gave them, some they bought themselves. We actually taught them how to turn bats. Lemonis how much do you owe them . Scott about 25,000. Lemonis how much debt is on the company today . Scott right now, including our line of credit and our new term loan, we have about 700,000, and im out 800,000 my life savings, gone. Lemonis how much revenue will the business do this year . Scott hopefully a little over 2 million. Lemonis and how much will you cash flow positive . Scott probably about 40,000 to 50,000 at that level. Lemonis so how are you servicing the debt . 40,000 . Scott just told me that he has 700,000 of debt. That doesnt include his payables. And he does 2 million a year in revenue. Problem is no profits. He only has 40,000 in working capital. And you cant service 700,000 of debt with 40,000 in working capital. At some point, youre gonna have a default, and things are gonna come crashing down. You know what . I have to tell you, im impressed by the fact that you have an mlb relationship. But im concerned about the fact that youre relying solely on that. Scott were only an mlb company. Lemonis so, right now, youre a seasonal business. Have you had to lay people off . Scott we do it every year this time of year because we dont have that fourthquarter item. Lemonis why havent you fixed that seasonality . I mean, ill tell you, the biggest challenge that you and i are gonna have is figuring out how to vary up this business model, or your lights are off. [ chuckles ] is this what you were talking about . This is your tracking system. It looks crazy. Jackie its unfortunate. Lemonis hows working with your dad . Jackie me and my dad argue all the time. He can definitely be stuck in his ways. So many of our skus are bat items. I want us to be not so seasonal. I want definitely some new, more innovative products. Hes been doing this for so long, that all these products, i feel like, are just sacred to him, and its so hard to let go of that. And i get that. I mean, i know theres, like, an emotional tie to the products that have put us through college. And you know what i mean . Its business, and you cant take it personally. You have to just move on. Scott thats my wife, wendy. Lemonis nice to meet you. Im told you have a son that also is in the business . Scott thats benjamin back there. Lemonis ben . Ben hi, marcus. Lemonis how you doing . Im marcus. Ben nice to meet you. Lemonis nice to meet you. And so, whats your role here . Ben i mainly help manage these guys in here, keep things moving. Do a little bit of everything right now. Lemonis and wheres your Raw Materials . Ben Raw Materials are in the warehouse. We run out to the warehouse, grab the Raw Materials, bring them in here, and we allow that to dry. And then they return to that room again. Lemonis that sounds kind of. Ben yeah, its all over the place. Thats what i want to change. Lemonis you know what i feel like when im in this building . Like a mouse looking for his cheese. You start in one room, and you have to visit at least eight of those rooms to finish the product. This place is wildly inefficient. Ben theres not a flow. Lemonis why doesnt your dad want to get it fixed . Do you ever talk to him about it . Ben hes kind of just like, you know, stuck in his old ways. Its just how weve been doing it for 20plus years. Lemonis right. How frustrating is that . Ben its pretty frustrating. Without having space to store things, youre just gonna be stepping over stuff. Lemonis theres stuff piled everywhere. These ceilings are so low, they couldnt even add the right inventory racks to maximize space. They dont even have a loading dock, so big orders, they have to be walked out of trucks. This facilitys a mess, and in my opinion, its also a fire hazard. Why do you stay here . Scott i just dont think we can afford to move. Lemonis how much is it a month . Scott 1,300. Lemonis which is cheap. Id rather you paid. 8,000, but the process was perfect and you didnt lose orders, and you didnt have materials go bad, and you kind of trip over dollars to pick up nickels. Scott thats what i need. Cashflow savings is what im looking for. Hello. Lemonis i thought maybe we could all chat a little bit about what do you guys have invested in this business . Wendy pretty much everything. Scott these kids lost their inheritance money that went in to cover payroll in times where we couldve laid people off, and we kept them on. Lemonis do you financials . Scott i do. This is what my accountant and i had done based on this years sales, okay . Lemonis how much money will the business lose this year . Scott well probably break even or lose a little bit if we dont do more than 2 million this year. Lemonis 285,000 is your total payables. Scott i mean, a third of it is seriously past due. Lemonis so, the bank loans are somewhere around 630,000. Scott mmhmm. Lemonis and so, if i take the accounts payable and the bank loans, im pretty close to a Million Dollars. Scott 900,000something, yeah. Lemonis were drowning in debt right now. Wendy my kids and i, we all agree as a family he needs help. This might be it. Lemonis are the kids here now . Wendy jackie . Lemonis business like this has to constantly evolve. And so, what were talking about is kind of the number of issues that exist inside the business. Jackie i mean, just based off of our conversations at every dinner table, were wearing too many hats, and were involved in so many things. And i think that thats gonna, like, run us ragged after a while. Lemonis does he give you the opportunity to do your job fully . Jackie no. Ben thats the thing that bothers me the most. Lemonis 25 years ago, scott came in, and he saved this company. Now scott needs to let his kids do for him what he did for his father. If its okay with you guys, id like to spend a minute with your parents just alone if thats all right. Jackie mmhmm. Lemonis thank you. Scott [ sighs ] lemonis lot of stress. Scott im tired of it. Lemonis you okay, wendy . Scott [ sighs ] wendy [ voice breaking ] well, its just highly unusual for him to talk this way. So, it really hurts. You know, it just its scary to me because it really makes me realize somethings really, really wrong. Lemonis i know that you put on a good face for your kids. Scott we need help. Thats it was their idea to call you. Lemonis the kids idea . Scott yeah. [ sighs ] lemonis ready to get down to business . Scott believe me, ive been through so much i can handle anything. Lemonis the issues that i see right now is your process is totally broken. Its maybe one of the worst ive ever seen ever. Product innovation we need new things because you can only sell so many bats in the world. Scott a mini bat will be around forever. Lemonis thats the base that pays the light bill. Scott well, we do have other things from minor league. We do the hands. Lemonis if you werent selling your product in all the stadiums, i wouldnt be here. But in the long run, you cant make it just on mlb. Its too seasonal. So, my offer is the following. 630,000 to build out a new warehouse, put the Inventory Systems in place, and then pay off all of the payables. For that, i would want to be 50 50 partners with you. Scott i mean, youre asking for 50 of my business. Thats 30 years of my blood and sweat. You have to have more skin in the game. Cowboy up. Lemonis whats gonna be my return on my investment in the first couple years . Zero. Thats too much risk for me. Scott if we put a half a million to a Million Dollars of sales on this business in the next year, we can turn this thing around. Lemonis but you need the 600,000 to do that. Scott i think heres the way i look at this. When a doctor wants to break into a practice, he buys his way in correct . To become a partner. Lemonis youre not interviewing me, im interviewing you. Im not a bank, im not a consultant, and im not the fairy godmother. I dont just sprinkle money around. Scott i think thats a lot, marcus, for that amount. Lemonis if your business is in trouble and you need my help, log on to. Rowithout the Commission Fees and account minimums. So, you can start investing wherever you are even on the bus. Download now and get your first stock on us. Robinhood. Lemonis so, my offer is the following. 630,000. For that, i would want to be 50 50 partners with you. Scott i think thats a lot, marcus, for that amount. That kind of an offer lends itself to 30 , not 50 . Lemonis im willing to lower my percentage. Im not willing to put any more money in, and so 630,000 for 30 of the equity and financial control. Im gonna want a 3 royalty on every product we sell. Scott forever, or until your debt is repaid . Lemonis forever. If the sales only go up to 2. 5 million, my 3 royalty will be about 75,000 a year. With my investment being 630,000, thats a pretty nice annual return. But what they also have to realize is that im now motivated to drive those sales. The more we sell, the more we both make. I know how important this business is to you and your family. I also know how i want to get a return on my money. We got a deal . Scott we got a deal. Thank you very much. I appreciate it. Lemonis so, i plan to take 150,000 to pay down debt, 180,000 for pastdue payables, 150,000 to build out a new facility, and 150,000 for working capital and product development. Lemonis got a lot of work to do. Scott lets do it. Lemonis well see you soon. Scott thanks. Appreciate it. Lemonis i wanted to let everybody know that the family