And create a few products. Juli it reduces anxiety and depression. Lemonis i kind of like it. I spent countless days working on these companies. How much money did you burn through . Parker 650,000. Lemonis but we cant always fit everything im thinking into the show. So tonight, were gonna take an inside look at episode from season 2, athans motors. Pete this is my money. Thats the problem. If thats micromanaging, youre damn right. Im gonna micromanage everybody. Lemonis we may have actually understated what a micromanager this guy was. Pete thats ridiculous. Lemonis over the next hour, im gonna take you behind the scenes to share with you what i was actually thinking during filming. There literally were no cars in that parking lot. Oh, my gosh. Is this guy already out of business . Share some secrets. My offer 3. 5 million. People were upset with me on social media. How could you give this guy such a great deal . I knew that with a couple million bucks, this thing could be up and running. And give you an honest assessment of my decisions. Whatd you pay for the building . Pete 1. 875 million. Lemonis how much debt do you have on the business . Pete about 6. 9 million. Amber why didnt you run . Lemonis if the shop had been empty, i would have been out of there. My name is marcus lemonis, and this is an inside look at the profit. Tonight, im gonna give you an inside look at our First Episode from season 2, athans motors in chicago, and it happens to be the car business, which is something that im familiar with. Amber will you tell us a little bit about your history with the car business . Lemonis i grew up in the car business. My family had been in the car business for a number of years. You remember when you went to summer vacation, to camp . Amber yep. Lemonis yeah, no, that wasnt me. My summer camp was mopping asphalt. I was a car jockey. I was a parts runner. I was a car salesman. I did all of it, and i loved it. Actually the best thing i ever did. Ive just arrived at athans motors, and i cant figure out if this place is even open. Where are all the cars . But what they do have is all super highend. In a good usedcar dealership, you have to have affordable cars. That shot of the parking lot was not anybody being clever trying to exaggerate that there were no cars. There literally were no cars in that parking lot. I remember walking in and thought, oh, my gosh. Is this guy already out of business . Wow, look at this place. I go in the showroom. Theres two or three cars, and theyre oddballs, and first thing i do is, i look up, and i see this giant mural. He was like michelangelo painting on the ceilings. What goes through my brain is, whatever it cost to paint that could have been one more car on the showroom floor. How you doing . Im marcus. Larry larry. Nice to meet you. Lemonis nice to meet you, larry. Is this car for sale . Larry yes, it is. Lemonis how many total cars on the lot . Larry probably 20. Lemonis total . Larry total. Lemonis twenty cars . Twenty cars is more like a private collection than a usedcar dealership. If you want to drive volume in the usedcar business, you really have to have a wide selection with different brands, some sport utilities, some convertibles. And a little tip for anybody in the usedcar business what sells new sells used. Lets start with matching your used inventory to what sold in the last 24 months from the new manufacturers. Pete. Pete marcus. Lemonis how you doing, buddy . Thank you for taking the time. Lemonis absolutely. Pete whatd you think of the place when you first walked in . Lemonis its. Yeah. Its built out. Thats for sure. Pete this is my soul. I design. I architect. Lemonis have you been in the car business a long time . Pete no. I was only 5 years in the car business before i opened. Ive put everything i have in here and my soul and my bank account. Can i give you a tour of the place . Lemonis all right. Lets do it. Pete im the one who did everything, so im ready to be one of the best independent stores in the united states. Lemonis youve got to get some cars first. Whatd you spend on these walls . Pete close to 100,000, 80,000. Lemonis okay. Pete i try to do something right once, so i dont have to touch it ever again. Lemonis you put in how much in renovating the place, a Million Dollars . Pete over 2 million. Lemonis wow. Pete the ceiling alone probably was about 15,000. Lemonis so one used car . Pete correct. Lemonis okay. Pete i created a stateoftheart customer lounge. Lemonis where are the customers . What did it cost to build out this whole room . Pete close to half a million. Lemonis come on. So, like, that granite, how much does that cost . Pete they were about 25,000, the four. Lemonis and all this movie stuff, how much is that . Pete tvs are about 15,000. The seats are 25,000, 30,000. Lemonis pete, why . How does any of this help you sell cars . Pete i made this store to be the place where you want to hang out. Lemonis i dont want to hang out. I just want to buy a car. Pete . To have the best Customer Experience anywhere in the united states. Lemonis pause. In all the years that ive been making the show, i dont know that ive ever seen anybody be as reckless and as irresponsible with money as pete athans was, and rather than continuing to belabor the point of what a mistake it was, the money was spent already. Now the question is, how does the business actually take this overly done facility and get some inventory . Whatd you pay for the building . Pete 1. 875 million. Lemonis so you have a little under 4 million in the facility . Pete yes. Lemonis how much debt do you have on the business . Pete about 6. 9 million. Lemonis what . Im sorry, how much . Pete 6. 9 million. Lemonis wheres the money . Pete holding the losses to keep this place going. Im losing over 100,000 a month for almost 2 1 2 years. Lemonis this is a bad scenario. Amber why didnt you run . Lemonis i love the market. I know the business. I didnt think the facility was bad, and i knew that with a couple million bucks specifically for inventory that this thing could be up and running. Hi. Erika hi. Lemonis im marcus. Erika im erika. Lemonis how are you . Erika good. Nice to meet you. Lemonis are you accounting . Erika well, im the Operations Manager here, so i do all the accounting, all the finance. Lemonis do you have a Financial Statement for last month . Erika the books are in your office. Pete sure, ill get it. Erika i can print you one, i think. Lemonis you do the books, but youre not allowed to keep them . Erika everything stays in petes office. Pete but not because she cant get it. It just stays in my office. Lemonis the idea that the accounting person doesnt have control of financials is a bit ludicrous to me. An accountants job, in my mind, its to be an advisor, to tell you what the numbers are, where the breakeven analysis is, whats working, whats not. Theyre there to be a copilot. If you actually take the Steering Wheel away from your copilot, then theyre just a passenger in the car thats going nowhere. Right now, youre losing 150,000 a month. Youre selling 10 cars. Youre 50 cars short from breaking even. In order to make up for the 150,000 of monthly losses, athans would have to sell 60 cars, 2,500 profit per car. In order to sell 60 cars, you need at least 120 on the ground. Today, you have 20. Youre 100 cars short. I mean, its a real challenge. How much money do you have in the account today . 27 dollars. Pete between 20,000 and 30,000. Lemonis thanks, erika. Erika youre welcome. Amber how does this business stay afloat after losing 1. 8 million . Lemonis he either brings in a partner, or it closes. No money, no cars no business. Petes cousin tony has been the general manager of athans since they opened, and i want to get his perspective on the business. Are you tony . Tony yes, i am. Lemonis how you doing . Im marcus. Tony its a pleasure. Lemonis nice to meet you. So youre the manager . Tony i wear all the hats. Lemonis you wear all the hats. Okay. Tony i have been in the car business about 18 years. Excuse me. Lemonis yeah. Hi. Man hi, how are you . Tony what can we do for you today . Man i am actually in the market for an suv. Tony you like a bmw, mercedes, porsche . What you looking for . Man im kind of looking for something a little bit more modest. Tony okay. Man . A ford, chevy maybe. Lemonis the first potential buyer ive seen since ive been here walks in, and hes looking to buy an suv. He seems motivated, excited, ready to buy. The problem is, we dont have what he wants. Tony i wish we could help you. Man no, its all right. Tony you know, maybe next time. Tony take care. Lemonis he wants to be in an affordable car like everybody else in america. And every suv we have on the lot is priced over 40,000. How many customers a day do you get that you cant sell stuff to . Tony its not just the walkin customers. Its the phone calls. Lemonis yeah. Tony its the internet. Lemonis seems busy, the service seems busy. Tony yes, service does, like, 100,000 per month. Sometimes, we do a little bit more. Lemonis most important part of any dealership is what happens in the service department. Highest margin, its the thing that is most important to the customer, and its nothing more than parts and labor. Both of them have extreme markup. Its an amazing business, so the thing that gave me confidence to stay was seeing that there was business going on in the service department, and it was 100,000 a month. If the shop had been empty, no technicians, no work, nothing on the lift, no work happening, i would have been out of there. So in your role as general manager, how much time do you spend out here . Tony im back here quite often. Lemonis those guys are reporting to you . Tony yes and no. Okay. I talk to them about daily operations, but technically, i dont really have authority over any department. Pete wants his finger on very single thing in the store. He micromanages, and the relationship is very strained. Lemonis now, over the course of all the seasons that weve done, weve laughed about micromanagers, but in this particular business, of all the businesses weve ever done, we may have actually understated what a micromanager this guy was. Micromanagement creates a morale problem because employees want to feel like theyre contributing, theyre earning their keep. You take that away from your team, youre essentially telling them that their effort doesnt matter, and when theyre driving home at night, are they feeling proud about the work they did that day, or are they feeling like theyre just collecting a paycheck . Because at some point, people want to contribute. They want to be rewarded. They want to feel like they have growth and not feel like theyre minimized. Youre almost 7 million in debt, and you have almost no cash. What do you stand to lose if this business closes . Pete i would lose my house, my dream. It would be catastrophic. Lemonis yeah. Well, the stakes are big for me, too. I take money very seriously. My offer is very simple. Its 3. 5 million to help clear the debt, bring in new cars for inventory, and essentially change athans motors into a brandnew business that makes money, and you share in the economics. It will be fiftyfifty partners, but im 100 percent in charge because i know this business better than you do. I think this actually may be one of the biggest deals that we did on the show, and i know that everybody was stunned by the number. People were upset with me on social media. How could you give this guy such a great deal . Let me explain how the numbers were made up. So, of that 3. 5 million, a portion of it was to pay off the debt on the building because i wanted to own the building, and the balance was to put inventory on the ground to make this business work, and i knew if i owned 100 percent of the building, and i owned 50 percent of the business, i was like, okay, im safe with the building. Im gonna own the cars, and him and i are gonna split the profits fiftyfifty. Okay. It wasnt a bad deal for him, and it wasnt a bad deal for me, but i was not gonna just give this guy money. Pete im a little concerned when you say 100 percent, you run the business because i believe i have Something Special here. Lemonis whats special about it . You have a usedcar lot with no inventory. Pete thats your opinion. Lemonis no, no, its not a [bleep] opinion amber [ laughing ] lemonis i mean, how is it an opinion . Hes like, no, man, theres Something Special here. Im running a circus. No cars. Sorry, i got fired up. In the 4 years youve been open, youve lost 4 million. Theres 20 employees that work here. Theyre gonna be out of jobs. Pete but what i have set up is infrastructure. Lemonis theres no process in place. Pete i dont care how much money you have, you cant have the right resources to actually run the business the right way overnight. Lemonis i dont agree with you. Pete i lemonis theres nothing magical about this business, sorry. Pete youre look. Lemonis you have no inventory. Its gone. Pete and will i be able to keep the name . Lemonis is the name important to you . Pete yes. Lemonis i thought keeping the place open was important to you. Youve got to put your pride away for a minute. Pete youre looking at it only on your end as an investor, as a partner. Lemonis yeah, im looking at it from my end because id like to not lose 3. 5 million. Im sorry. The only way this business works is if somebody that knows the business better than you is driving the process. It doesnt work any other way. Pete i think im unstoppable. Lemonis pete, if youre not gonna put your pride away, well, then im not gonna do the deal. Pete you dont need to raise your voice with me. Lemonis well, im raising my voice because you keep repeating the same thing, and you dont seem to understand what im telling you. Erika are you okay . Pete end it. Tony i have decided that i dont want to do this anymore. Pete play this through. Tony my decision is made. Lemonis this is the first time weve ever had somebody actually quit while we were filming the show. Amber youre right, yeah. And i like to question your im yoevery move. N law. Like this left turn. Its the next one. You always drive this slow . How did you make someone i love . That must be why youre always so late. I do not speed. And thats saving me cash with drivewise. [mayhem] you always drive like an old lady . [tina] youre an old lady. Goodbgoodbye fred. [ toilet flushing ] what if he gets hungry . Kohler revolution 360 with continuousclean. Stays clean five times longer. Its okay, dad. Only from kohler. Yeah. This moving thing never gets any easier. Well, xfinity makes moving super easy. I can transfer my internet and tv service in about a minute. Wow, that is easy. Almost as easy as having those guys help you move. We are those guys. Thats you . The truck adds 10 pounds. In the arms. Okay. Transfer your Service Online in a few easy steps. Now thats simple, easy, awesome. Transfer your service in minutes, making moving with xfinity a breeze. Visit xfinity. Com moving today. Lemonis i came here to help you. You asked me to come help you. I gave you a very fair offer. Its a yes or a no. Because im ready to bounce. Pete yes. Lemonis im writing a check for 3. 5 million. Pete maybe for the first time ever, good nights sleep. Lemonis this check, you know that im 100 percent in charge . Pete correct. Lemonis we have a deal . Pete we have a deal. Pleasure. Lemonis okay . Pete thank you for the opportunity. Everybody meet in the showroom, please. Everybody meet in the showroom. Lemonis good morning. Can we count the number of people in this meeting . Because theres more people than there are cars. If everybody sells a car today, theyll be out of business. Amber [ laughs ] so the reason were here today is that pete and i have made a deal. Pete and i are gonna be fiftyfifty partners, but things are gonna change dramatically. Were not gonna be buying fancy things. Video games and movie screens dont sell cars. Im gonna liquidate that stuff and transform this place so that every square inch generates revenue. Next, were gonna dramatically change the marketing plan because once we have cars to sell, we need to get the word out. Were gonna show this community that were no longer a highend dealership with no inventory. We will cater to everybody. Were gonna put on a grandreopening event, invite the whole city, have them come down, check us out, and hopefully theyll but some cars. The last thing and, i think, the hardest for pete, is that going forward, tony, pete is finally going to let you do your job. Right . Pete absolutely. Lemonis and were gonna do that. You know, its funny how much the industry has changed in the last 5 years, since even we shot this episode. The internet has revolutionized the way people buy cars both on the dealership side and the consumer side because the Technology Available today allows you to take the vin number and explode it and see the history, understand what the market is, see how many times its been sold. Its radically changed, and today, if i was giving that same meeting to the employees, while some of the basic principles would be the same, wed be having a lot more discussion around how technology will drive this business. I cant even imagine what the next 5 years are gonna be. Amber thats crazy. Lemonis crazy how much its changed. I will do everything that i can to make you successful and to help you make more money. Thats my job. Lets get to work. [ applause ] lets get to work. Hey, pete, can we go walk the inventory . Pete sure. Lemonis so lets grab erika and tony, as well. What do you think the thing that bothered me the most about pete was . You know what it was . It was the fact that he was always in his office. Amber sitting at his desk. Lemonis yeah, was never out on the floor, never in his inventory, never in the shop, never talking to customers. Automobile general managers i better never find them in their office. Im gonna liquidate inventory of cars that arent selling, and im gonna reinvest that cash into cars that i know will sell. One of the things i like to do in a business like this is walk the inventory every morning at the start of the day, so the average price of a used car sold around here is 15,000 to 30,000. How much is this porsche . Pete 76,000. Lemonis how much is this car . Pete 30,000. Lemonis how much is that car . Pete 46,000. Lemonis wheres all your cars under 30,000 . If you have a limited amount of capital, you have to prioritize where your first dollar is gonna go, and your first dollar of inventory has to go into products that you know are gonna sell, and as you build that inventory and you start satisfying the market, if you want to try nichey cars or expensive cars as the cherry on top after everything is done, fine. Whos responsible for buying cars . Tony i am responsible to an extent. Lemonis so did you buy all these cars . Tony no. Lemonis what the. . Pete i was buying. Lemonis what do you know . Pete is so committed to proving that his way is the right way that hes ignoring people that know the business far better than he does, and he continues to bury himself in debt and bad decisions. If we dont understand where the market really is, and we dont price properly based on the age of the car, then ev