Lemonis okay, okay. Nina youre not dizzy, are you . Finia nina, you see how aggravating this is . Lemonis im marcus lemonis, and i risk my own money to help businesses. I love investing in american businesses. Woman these people are here because they care. Lemonis its not always easy, but i do it to create jobs, and i do it to make money. Do we have a deal . Lets rock and roll. Man yeah lemonis this is the profit. Im in atlanta, georgia, and im on my way to perimeter mall, and im here to see Macaron Queen, which is a very small startup in the dessert space. Its clear to me that Macaron Queen has a Good Business model on a small scale, but this particular product possesses all the qualities needed to actually become a directtoconsumer product and a big wholesale product. They want to grow, but they want to grow profitably. Woman 2 a princess cake, two of those creme brulees. Lemonis i love french macarons. I would almost call myself a macaron snob. Nina hi lemonis im marcus. Nina hi, im nina. Lemonis nina . Nina yes. Finia pleasure to meet you. Finia. Lemonis are you mom . Finia yes lemonis okay this is a really beautiful display nina thank you. Lemonis look how colorful it is. Nina we wanted to make a place where macarons were in the forefront. Lemonis where did the idea come from . Nina well, its a french cookie, and the origin is over 300 years old. Lemonis are you guys french . Nina no. My real father is part european, but mom is iranian. Lemonis okay, cool. Finia i took two classes in paris. Lemonis you went to macaron making . Finia yes. Now im the Macaron Queen. Lemonis okay. I thought you were the Macaron Queen. Nina no, im the princess. Im the daughter. Lemonis is this one of the hardest pastries in the world to make . Nina i would think yes. Finia yes, it is, very. Nina its called the impossible cookie. People always say, i tried it at home. It didnt come out right. So mom knew, from reading these books, why its not coming out right. She condensed and slowly filtered her recipe. Lemonis and whats a busy day here, dollarwise . Nina 1,700. Lemonis whats a slow day . Nina 400. Finia now, these days, everybody sell macaron for 3, but we sell them for 2 apiece. Lemonis im gonna try a box of 25. Im gonna do tastetesting. Red velvet . Nina yes. Champagne. Key lime. French raspberry. Lemonis so im gonna give you my honest opinion of these. Finia okay, please. Lemonis i actually think this is the best macaron ive ever had, by a lot. These had a cakey feel to it without collapsing. The flavors were very pronounced, and then i thought the fillings had their own personality to them. Nina thank you. Lemonis so as a potential investor, i need to get feedback, so im gonna start bringing people in to come try them. Do yall have a tray . Nina yes. Lemonis who would like to try a free macaron . Youve got to give me feedback. Come on down. How are you . Man 2 im wonderful. How are you . Lemonis pick any flavor. Man 2 im gonna get the chocolate. Lemonis have you ever had a macaron before . Man 2 oh, yes. This is out of this world. Lemonis is it too hard, too soft . Man 2 oh, no. Its a winner. Man 3 its not too sweet. Man 4 i might be a tough critic because i dont usually eat sweets. Man, thats good. Woman 3 its yummy, soft, rich. Lemonis too soft . Woman 3 no, no, no. Medium soft and good. Woman 4 i think every macaron is different, depending on who bakes them. Lemonis how much do you think that one would be . Woman 4 3 to 5. Lemonis separate from me loving desserts, i like the idea of entering into a space that isnt widely distributed, and theres Something Different about these desserts because theyre small. Theyre really tasty, and you dont see them everywhere. Nina it does look elegant. Lemonis why doesnt your color scheme here match the. Finia actually, this color, they made a mistake because its supposed to be tiffany blue, and it came out this way. Nina well, what i wanted to mention is part. Lemonis you just grabbed your moms hand, telling her to be quiet. Nina yes, i did. No, i wanted to insert a fact. Lemonis okay, and tell her to be quiet. Is this your only child . Finia yes you can tell . Lemonis yeah. Sure, right. Finia i really like you nina i knew this would happen. Im screwed. Bye lemonis i would almost describe nina and her moms relationship as almost two sisters. They really do respect each other, and you can tell by spending time with them that they both bring something very different to the table. Do you do everything she tells you to do . Nina no, no, no, no, no, no. Finia no, no. Not when it comes to my business, no. Lemonis is it your business . Finia our business. Nina ive taken over since her heart surgery. Finia i had a heart surgery two years ago. I had been sick with heart problem since i was 7. One day in the bakery i fall, and i call her, and she call ambulance, and i go to the hospital. So she was. Lemonis how scary was that . Nina very scary. Weve shifted roles. I, essentially, not in the food industry, opened our commissary kitchen. Im not a chef. Im not a baker. Lemonis but you did it to do your mom the right thing. Nina i did. Lemonis inside of every business, theres a story of why they got in the business, how they got there and the troubles that theyve had, and the fact that finia has had real Health Scares puts a lot of pressure on the business. Finia nina designed the kiosk. Lemonis beautiful. Finia she was in fashion when she was younger. Nina i started as a designer. Lemonis in paris . Nina i was designing for a manufacturer, so he had, like, 12 labels, and thats what i did. Lemonis International Distribution or just. Nina yes, international. Lemonis you should be very proud. Youve done a great job. Finia those are good days. Lemonis every day is a good day. Nina these were good days, too. Finia shes so kind, and she tell me, mom, dont worry about it. Your passion is my passion, but sometime i think this took her life away from what she was doing before. Lemonis i respect nina because shes loyal to her mother, and she truly has put her own dreams and her own wants aside to support her familys business, but i wonder if over time resentment builds up, and then, all of a sudden, shes gonna be gone. So ill meet you guys at the commissary. Nina okay. Lemonis . And well learn more. Nina okay. See you soon. Lemonis see you in a little bit. Nina thats the office. This is the delivery entrance. Lemonis this whole thing is yours . Nina yes. Lemonis i want to see exactly what the process is. If this is the miracle cookie, or the hardest cookie in the world to make, i want to understand exactly how theyre doing it. Finia thats my husband lemonis hi, sir im marcus nice to meet you habib nice meeting you. Lemonis so can you give me a tour . Habib sure. Lemonis so these are the shells. Nina mmhmm. Lemonis youre the shellmaker. Nina so dad knows the recipe for the shell. The shell, no one knows the recipe. Mom has had offers to write books, have classes, but she felt like someone might steal her recipe and go do their own business, so she kept it very close to her heart. Lemonis how are you, maam . Im marcus. Zion im zion. Pleasure to meet you. Lemonis nice to meet you. So you do not know the recipe . Zion no. Nina weve had a hard time, honestly, keeping employees. Lemonis no, but somebody. The business wont go anywhere. This isnt like a macaron incubator. If this business truly is going to grow, with me or without me, its going to need to be able to scale production, and if the recipe isnt available to anybody, then i guess this thing isnt gonna make more than the two of them could make. Nina part of knowing the recipe is the experience in looking at the batter, and with your eye knowing when its right. Lemonis its a science. Nina would you like to go in the fridge . Lemonis yeah, lets do it. Nina lets go. So this room, i can put macaron shells here without a cover, and it ages faster. This is presold. This isnt dated, but for example. Lemonis presold to who . Nina our wholesale clients. Lemonis okay. Who do you wholesale to . Nina bubble tea clients, coffee shops. Lemonis is there more demand in the marketplace for wholesale . Nina yes, but beyond what we do here, we couldnt handle. Mom wants us to focus on the mall. Lemonis a lot of Business Owners struggle with being able to determine the difference in profitability between retail and wholesale because on the surface, they look at just the actual cost of making the product, and they forget about all the other factors, and so i just needed to lay it out for them. Here is what i want you to think about you know you have strong demand. You know you have capacity room. You know youre underutilizing your facility. Why arent you producing more . Nina can you hold on one second . Are you sweating . Are you okay . Finia yes, its. Im going to. Just want to make sure my heartbeat is okay. Nina well, this is more than usual when youre sweating beads. Lemonis lets check it. Finia 92. Lemonis is that high . Finia is high. Nina her pills put her heartbeat at 50something. Finia thats what macaron does to you lemonis finias heart problem presents an issue to her health, but it also presents a huge issue to the business. My ultimate goal here is to create a Business Model that allows finia to be a member of the team, not the only member of the team. Im not interested in making things worse for her. Were gonna wrap it up. The next time we meet, well sit down and well go over the financials, and well talk about the business. Nice meeting you. Nina nice to meet you lemonis well see you soon. Finia thank you nina bye, thank you finia byebye nina let me move the dessert out of the way. Ive never seen him go to anyones house. [ knock on door ] finia [ gasps ] lemonis hi nina hi lemonis wow this is the first time ive actually ever gone to someones house to look at their financials. Thank you for doing this, by the way. Finia oh, youre welcome. My pleasure. Lemonis that was so nice of you. Finia made me a middle eastern meal like my mother would, so i have to remember as i go in there not to get sucked in by this motherly love and that this is still a business deal. I have a feeling its gonna be hard. The food is wonderful. Finia im glad you like it. Lemonis i love it. So do you have financials that we can look at . Nina mmhmm. Finia yes, sure. Lemonis in 2017, you did 390,000 of revenue, a net profit 77,000. For 2018, last year, 369,000 was the revenue. After all the expenses, 73,000 profit. The business does less than a half a million dollars, but it makes money. What were gonna want to understand is what the true net yield is in wholesale and in retail. Which one is actually more lucrative. Nina yes. Lemonis the cost to fulfill in retail, 1. 39. What is the cost to fulfill the wholesale . Finia probably 10 cents. Nina yeah. Lemonis so 10 cents. Finia mmhmm. Lemonis the cost to manufacture a single macaron is 39 cents. With retail, an additional cost of 1. 39 is added to the product because of the kiosk rental, the delivery, the employees and the insurance. Wholesale, the additional cost of the product is about 10 cents, between easy packaging and the delivery. The retail macaron sells for 2. 08, and the wholesale macaron sells for 1. 15. Gross profit for retail, 30 cents. Gross profit for wholesale is 66 cents. The real profitability is in wholesale. Lemonis alright. Heres sort of where im at. I want to make an offer. What i would like to do is invest in 100,000 increments. The 100,000 increments would be based on achieving certain production levels without compromising any quality, and the total amount of money that would be out there would be a half a million dollars. For each 100,000, i would want 10 of the business. No less than 10 . Finia so you want. At the end, you want 50 partnership . Finia thats not macaron. I get insulted. I go, and they say french macaron. No. That should be illegal. Nina it makes her want to change the name. Lights, ornaments, chand lil choo choo trains. Cmon. The best trees, they kinda only need two things. Peanut butter and chocolate. Not sorry. Reeses. Its the ikea winter sale. Akatheupto50 off already lowpricessale. Akathelookwecantouchevery thingbeforewebuyitsale. Akathebtwicymi. Akatheifinevergetoutof hereitwasniceknowing allofyousale. Akatheallthesesavings canreducestress look it up its science. Fomoirlftwsale. What . Its been reported that theres a cyberattack on business every 39 seconds. Ouch. I dont even want to think about it. Comcast business has a solution. We go beyond fast with a cloudbased Security System that automatically updates, so you always have the latest protection. Phishing. Malware. 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The way that im setting this up is that, for every 100,000, i would want 10 . You dont have to take the 100,000. You have the right to take the 100,000. Essentially, what i want them to do is to prove out their thesis stepbystep along the way, and actually earn the investment, and prove to me that, number one, they know what theyre gonna do with the money and, number two, they dont end up taking more money than they need. I dont believe the Business Needs 500,000, but if goes from making 1 million macarons a year to 10, ill be glad to invest the balance of the money. If the business can make its own money. Nina it might not need money. Lemonis . It wont need my money. That is my offer, and when it comes to the finances, im in charge of them. So what do you want to do . Finia i take your offer. Lemonis you do . Finia yes. Lemonis okay. Nina yes lemonis the Macaron Queen. Okay. Nina thank you. Yay finia i make this the best 100,000 you have ever invested. Lemonis good morning nina good morning lemonis hey finia good morning. Lemonis how are you . Finia good nina hi, partner. Lemonis high five. I just want to recap what were doing, where were going. You know, as all of you know, we all agreed to do a deal together. Finia yay nina yes lemonis but ultimately, at the end of the day, the company has to define who it wants to be when it grows up. If it wants to be a small city of atlanta kiosk. Finia thats not what we are shooting for. Lemonis what are we shooting for . Why dont you tell me . Finia we are shooting for the moon lemonis okay. This business could be super profitable, but in order for that to happen, changes have to happen. First of all, we need to pivot away from retail and focus more on wholesale and directtoconsumer, where the margins are way higher, and in order to grow the revenue, were gonna have to find a copacker someone that can actually accomplish the larger production runs. And lastly, were gonna have to figure out ways for finia to monetize her expertise and her knowledge, either through a book or selling her recipes. But the most important thing that will come out of this it will allow finia to find the balance between work and preserving her health. How much is your rent at the mall . Finia 5,408 per month. Lemonis and how much time is left on it . Finia end of november next year. Lemonis ultimately, i think the mall is a deadweight. Theyre spending a lot of time thinking about how to deliver to the kiosk, and who is going to staff the kiosk, and if they took all that time and energy and just allocated it all to wholesale with double the gross profit, then it was obvious to me, the kiosk is a giant waste of time. If youre gonna be directtoconsumer and wholesale, then be that. Dont also be running a mall stand. Its a distraction right now. Finia yes, it is. Nina okay. Lemonis hi, guys finia hi finia good to see you. Nina how are you . Lemonis im taking nina and finia to silverland bakery in chicago. Its a commercial copacker that specializes in stateoftheart equipment with stateoftheart production. In order for this business to grow to the wholesale level that im expecting it to, i need to find somebody that can help me with volume. Finia hello athena hello lemonis nice to see you. Athena nice to see you, too. Lemonis so am i gonna be in trouble with three persian women . Finia yes athena come on in. Very hot. So say you want a truckload shipped to california. A truckload is 22 pallets, up to 24 pallets. Lemonis so the way to think about this is, she produces. She stores it, and then we have to provide the logistics and the storage on the other side. So it just becomes a logistics game. Why dont you guys take her through the process . Finia okay. Athena so are these french or italian . Nina well, actually its a mix. Finia its a secret recipe. I had to work on it and adjust it so many times to get the right texture and all that. It has to process. Athena so by processing, you mean you mix the almond flour with the powdered sugar and mix that together, and. Finia you have to run them first and then add to each other. You know, get it to the point that we want. Athena well, thats something well have to Work Together because i dont believe in doing anything extra because that adds labor cost. Finia with macaron, the batter is very, very sensitive. Nina processing our flour and sugar is one day. Lemonis are you doing some sort of magic voodoo to the flour . Finia no, no. We run it to our eye and perfection. Lemonis she doesnt like to tell anybody about the recipe. I need her to understand that the reason to share the recipe with more than one person is that she does have a health issue. God forbid something happened to her, without the documentation of the process and knowing the exact ingredients, what are we left with . A name and a kiosk . Athena you know what . In manufacturing, that stuff has got to go out the door. Lemonis this is an important thing, though. Athena does millions and millions of products a year. All shes suggesting is, youre doing all these things over in the corner so nobody sees it, but there is a written process that could be installed that would accomplish the same thing that doesnt have to be like columbo is trying to figure it out. Athena cos