ant anhiytng that went along with it. that's the reality. ♪ ♪ lemonis: i'm trying to get my connection right. hold on. tamika: oh! don't want that to happen. [ laughs ] but listen, bro, look. marcus! [ laughs ] hey! lemonis: your hair is cool. tamika: thank you! i heard blondes have more fun. lemonis: is it true or no? tamika: it's true. lemonis: tamika, i only came here for you. i don't care about your brother. tamika: [ laughs ] i feel special. lemonis: we haven't seen each other in five years. tonnie: years.

lemonis: and i thought every five years, i got to come beat you up a little bit. tonnie: okay, i'm ready for it, i think. lemonis: tonight, we're going to give you an inside look at an episode from season 3, tonnie's minis, one of the most challenging episodes that i've ever been a part of, but i learned a lot from it. and tonight the three of us are going to share the things that worked for us, the things that didn't work for us, and we're going to provide you some tips on how you can get through these new times. lemonis: in the last seven years of doing "the profit," i've visited nearly 100 businesses. let's go make some money! [ horn honking ] and i've traveled the country trying to fix the people... and you do $1 million a year? you should be proud of that. man: but we don't know how to keep any of it. lemonis: ...fix the process... you see? it flimsy. don't ever make these again. you don't sell them. ...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 can't always fit everything

i'm thinking into the show. tonight, we're going to give you an inside look at an episode from season 3, tonnie's minis. it's kind of a tight space. lemonis: oh. oh, thanks for clearing that one up. [ both laugh ] over the next hour, i'm gonna take you behind the scenes to show you what i was actually thinking during filming... tonnie: it doesn't really work that way. lemonis: no, no, no. let me give you a little news flash. does work that way. i sensed the talent, and i sensed the dedication, and if i didn't sense that, i wouldn't have stayed. ...share some secrets... right now, we're losing money every day. we're closing the store. i want to apologize to you for how hard i was on you, to a degree. tamika: [ gasps ] lemonis: ...and give you an honest assessment of my decisions. do you think i'm taking advantage of you? tonnie: yes. lemonis: i don't want to be in a relationship where somebody feels like they're getting taken advantage of. tonnie: i questioned if i wanted to do this again

out of embarrassment for the way i behaved on-camera. lemonis: my name is marcus lemonis, and this is an inside look at "the profit." part of the reason why i wanted to do this episode is back then, the cupcake craze was on fire. and i wanted to find somebody in new york city, the biggest market in america, where there would be an opportunity for me to at least learn the process, understand why people were so crazy, understand the margins, understand where the money-making opportunity was. and anytime i think about investing in a business, it's always good to start small, like minis. ♪ lemonis: inwood is at the northern tip of manhattan. it's an up-and-coming neighborhood with a lot of renovation, and there's a lot of new restaurants and new retail, and it's -- you feel like it's really growing. ♪ but tonnie's minis has the worst retail entrance i've ever seen. this build-your-own cupcake better be great. i remember when i was walking up broadway, and i couldn't find the store,

and all i saw was all this scaffolding. couldn't see the sign. couldn't see anything. and i thought to myself, "well, here's problem number one." tonnie: i agree, 100%. lemonis: how you doing? tonnie: how are you? lemonis: are you tonnie? tonnie: i am. lemonis: i'm marcus. tonnie: pleasure to meet you, sir. pleasure to meet you. lemonis: nice to meet you. this is a small space. tonnie: it's -- yes. it's been challenging. lemonis: i'm expecting to find a bright, fun retail environment and what i end up seeing is no display and a bunch of packaged cupcakes that are made in the back. i mean, who would want to come here? what was your expectation when i walked in the door? tonnie: we were thinking, "okay, here's a shot to kind of gather the team and kind of, for the first time, step out and get it right." lemonis: and, you know, when you used to say things to me like, "i want to get my team together," you know that that was an eye-rolling moment for me, right? tonnie: i didn't know that. no, i didn't know that. what do you mean? lemonis: we had one little shop here, and it almost made me feel like you had a little bit of a delusion of grandeur. tonnie: what the world didn't know, that was one of four stores at the time.

we were doing 20,000 day in cupcakes. i was supplying one of the largest restaurants in new york city. i had a deal with macy's on the table. so i'm thinking i've made all these steps that were leading up to this point right here in preparation for your coming. -tonnie: how are you? -woman: good. tonnie: welcome to tonnie's. what can i do for you today? woman: let me get the cream cheese. tonnie: can i offer you a cupcake, marcus, at the same time? lemonis: you surprise me. so, that's the base? tonnie: so, the beauty of tonnie's minis is you walk in, you pick your cupcake out, you pick your topping. woman: i like it. it means make your own cupcake, essentially. lemonis: you a cupcake eater? woman: yes, actually. thank you so much. -have a wonderful day. -tonnie: take care. lemonis: cupcake's good. tonnie: always happy to hear that. lemonis: the frosting's good. the process seemed a little...nonexistent. i would have thought there would have been a bit of an assembly line, like base, frosting, topping. i don't necessarily see that. tonnie's idea of a build-your-own cupcake, quite frankly, is phenomenal. but the idea i thought i was coming for i just don't see. somebody takes a cake off a rack

and then the toppings are, like, hidden under the counter. i mean, it's terrible. how much business are you doing in this location? tonnie: average is $500 a day. lemonis: and what are your margins on that $500? tonnie: um... cupcake costs me a quarter to make. lemonis: wrapper, frosting, labor, everything? tonnie: so it, uh... lemonis: one cupcake -- what does that cost to make? tonnie: so, the cost of the cupcake would be closer to...33 cents. -lemonis: are you winging it? -tonnie: i'm estimating. lemonis: i wouldn't call it estimating. i'm gonna call it guesstimating. tonnie: touché. lemonis: my biggest mistake in the entire episode, and i'm being very serious right now, was showing up in a bow tie. tamika: mm, maybe. lemonis: the worst wardrobe choice of all time. lemonis: what are you selling them for? tonnie: starting at $2.25. if it costs tonnie 33 cents to make a cupcake and he sells it for $2.25, he's got great margin. the worry here is that he's shaky on his numbers, and at $500 a day in sales, there is no room for error.

kind of a tight space. tonnie: this is the oven. lemonis: this is the only oven you have? tonnie: this is the only oven i have, yeah. lemonis: there is no workflow in this place, and it's cramped and it's hard to maneuver. tonnie: yeah. lemonis: "yeah," what? tonnie: [ laughs ] so, that space was cramped. lemonis: oh. oh, thanks for clearing that one up. [ both laugh ] tamika: hi, marcus. tamika. lemonis: tamika, nice to meet you. tamika: you, too. lemonis: how are you? are you the sister? tamika: yes. lemonis: i'd love to kind of spend a few minutes with you if you don't mind. tamika: okay. lemonis: who's the manager here? tamika: i'm on-again, off-again. lemonis: walk me through that. tamika: i worked for, like, really, really low pay, which was okay with me. lemonis: for how long? -tamika: like a year. -lemonis: wow. -does he listen to you? -tamika: no. -lemonis: no? -tamika: no. lemonis: tonnie, why weren't you listening? tonnie: it's not that i don't listen. it's more of, it's never as simple as someone saying, "let's do --"

there's always more to it than that. so, there's a lot going on with tonnie's minis right now as we speak. i'm doing a project in newark that's close to being finalized. the people who are giving me the space, they're building out the store. lemonis: at their expense? tonnie: at their expense. so what i have to supply is equipment, the first month's deposit, working capital. lemonis: and they're giving you the money to do that? tonnie: they're loaning me the money to do that. lemonis: do you feel like you're ready for more expansion? tonnie: i am now. lemonis: the only time a business should be expanding is when it's totally proven out its model. you have the product right, you have the right people, you have the right process, and it makes money. -hi. -erenisse: hi. how are you? -lemonis: how are you? -erenisse: i'm erenisse. -lemonis: are you tonnie's wife? -erenisse: yes, i am. -lemonis: hi. nice to meet you. -erenisse: nice to meet you. lemonis: what do you think of the store? erenisse: i think it needs an upgrade. that's why i wrote you. lemonis: oh, okay. tonnie, i thought it was you. tonnie: no, it was -- it was -- it was her. erenisse: the business aspect of it has placed a lot of stress on our marriage.

it's to the point that i'm not giving any more money. lemonis: how much money do you have invested in this business? erenisse: like $250,000. tamika: ooh! tonnie: yeah. tamika: that's a serious number. that was where i was thoroughly convinced that she loved my brother. no, i knew that before. erenisse: i think he needs you. i think he needs your expertise. if he hears it from you, maybe he'll take it. lemonis: he doesn't listen to you? erenisse: not all the time. not quite. lemonis: tonnie doesn't listen to his wife, who's invested a ton of money. he doesn't listen to his sister, who works there virtually for free. how do i know he's gonna listen to me? what does it cost you to open up the place every day? tonnie: the rent would be $100 a day. lemonis: all the employees -- how much do they cost a day? tonnie: average day is $180. -lemonis: how about electricity? -tonnie: $75 a day. lemonis: how about insurance? how about maintenance? how about office supplies? how about the phone? you're already well over $350. with $500 a day in revenue, if you factor in all of the operating costs plus baked goods, paper supplies, et cetera,

he's already operating at a loss. we're gonna do a little math. the total revenue that it shows on this p&l is $250,000 for the year, and you lost $76,000. there's the $250,000 that you put in. for this discussion, i consider that equity. because you guys are married. that's your business. it's the fact that you own, today, 100% of the business. erenisse: i agree. lemonis: there's $134,000 that is owed to other people. so what do we owe other people? tonnie: the payroll tax is $11,000. federal state tax, $35,000. there's $15,000 in arrears, of which is february rent and water escrow. -and then late fees. -erenisse: $15,000? tonnie: then there's denise, $12,000. robert is $25,000. my mom for $13,000. michelle for $7,000.

erenisse: wait a minute. is this for her services, or she lent you money? tonnie: no, this is -- this is her... lemonis: this was tough. tonnie: ...loaning me the money. lemonis: this was tense. tonnie: then there's [bleep] $10,000. lemonis: who's [bleep]? tonnie: so [bleep] is the person who i borrowed money from and he picks up a weekly payment from me. lemonis: like a -- like a -- like a loan shark? tonnie: yes. tamika: i was surprised by some of the stuff that came out at that table. lemonis: do you mean like the loan shark? tamika: maybe that one. [ laughter ] lemonis: you're the only person in "profit" history that ever had a deal with a loan shark. we beeped it 'cause i didn't want somebody to come beat your ass. [ both laugh ] tonnie: and i appreciate that, sincerely. tamika: crazy! ♪ lemonis: what's wrong?

erenisse: i'm just upset, 'cause i didn't know about all those people that we owe money to. you know how i feel about that. sorry. tonnie: i mean, mama, you know i would never do anything to have you sitting here crying, but i did whatever i could to keep a door open, to keep from closing, to pay staff, whatever it took. so me hiding these numbers was not intentional. it was a mistake. it was foolish. would it happen again? never again. ♪ lemonis: tonnie, how's your wife? tonnie: she is wonderful. lemonis: she kept you around, huh? tonnie: yeah, she did. very blessed, very fortunate. lemonis: i'm sorry she couldn't be here tonight. well, i remember the fear that you had about disclosing certain information from your wife. i don't think you ever hid anything from her. i think you tried to insulate her.

tonnie: right, that is -- that is probably the best way to place it. thank you. lemonis: but it did come off a little shady. tonnie: after watching it, it did, yeah. lemonis: the reason that i came to this business was because i liked your idea. so my offer is $100,000 for 20% of the business. tonnie: i'm having a really hard time with that. the number i had in my mind was $600,000. lemonis: $600,000 for how much? tonnie: i'd say 33%. lemonis: you thought i was gonna write you a check for $600,000, everybody was gonna get paid, and i was gonna have a third of the business, and i wasn't gonna tell you what you could or couldn't do? -tonnie: no, no. and, again -- -lemonis: wrong show. do you think i'm taking advantage of you? tonnie: yes. it's been awesome knowing you, nice meeting you. but i don't want to be in a relationship where somebody feels like they're getting taken advantage of.

tonnie: watching the video, i questioned if i wanted to do this again out of embarrassment for the way i behaved on-camera. ♪ it's the simple joy of washing your hands,. without ever touching a faucet. it's the little things that matter. that's why we create moments to feel kohler clean, every day. ♪

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lemonis: you thought i was gonna write you a check for $600,000, everybody was gonna get paid, and i was gonna have a third of the business, and i wasn't gonna tell you what you could or couldn't do? tonnie: no, no. and, again -- lemonis: wrong show.

so, what are you thinking right now? ♪ erenisse: i'm uncomfortable with [bleep] lemonis: you mean the loan shark? erenisse: yeah. i don't know what these people are about. i'm uncomfortable with that scenario altogether. lemonis: so it would make you happy if that got paid. erenisse: yes. tonnie: i love my wife to the moon and back and then back again. we've always had a very open and honest relationship. never had an argument. we've never yelled and screamed after being together i think 11 or 12 years -- i was kind of at a loss because i couldn't take back what was said. i couldn't take back what was done. i didn't think she was going to leave me, but my concern was, how do i fix this? and i couldn't. lemonis: so, then i'll up my offer to $125,000, and instead of 20%, we'll go to 25%. ♪ and i'm giving you about, like, maybe 10 seconds.

tamika: you know what you having full control ends up being. so now see what sharing control ends up being. ♪ lemonis: we got a deal? tonnie: we got a deal, marcus. lemonis: you know that when you take my check, i am 100% in charge? tonnie: 100% in charge you said? lemonis: she knows that. that's why she called me. she wants me to be 100% in charge. is that right? erenisse: yes, absolutely. lemonis: when i got in the van that night after spending time with your wife, i told the crew that i was scared of her because she was very serious, and i thought, "okay, this is -- this is gonna get bad for a minute. tamika: mm-mm. lemonis: here's the scene from the morning after. how was it at home last night? tonnie: no conversation. she hasn't spoken to me. just no words. lemonis: that's understandable. i get it. 'cause she feels stung. you kind of -- you kind of [bleep] up. ♪ tonnie: so this is a show, but when the show is over

and the cameras are off, i have to deal with this. lemonis: yeah, that's right. and when the show's over and the cameras are off, i still have to deal with it too. she didn't know certain things that it's not that unreasonable for her to know. you should've shared it with her like months ago when you started getting the money. let's just call it like it is. just own it. ♪ [ laughter ] tonnie: so, i obviously she came around at some point but there was definitely a concern of the fact that i had reached out to so many different people. ♪ lemonis: let's get everybody together. so, what i want to do is i want to understand the cost of one cupcake. i want the raw ingredients, i want the package, and i want the frosting and the sprinkles. i want it all. you're telling me that one batch makes 24, so when we add up all these costs, we're gonna divide it by 24. you ready to go? tonnie: eggs are 15 dozen. i pay $24. lemonis: 180 eggs, about 14 cents an egg.

tonnie: this needs three eggs. lemonis: so that's 42 cents. tonnie: the buttermilk is $1.40 per quart, and we use 1 1/4 cups. lemonis: okay. 44 cents. something you didn't like about that math? tonnie: no, it just seems higher than i thought. lemonis: pay attention to everybody. this is one of my favorite things to do, right here. we have paper and packaging at 5 cents. we have toppings at 5 cents. $8.33 for materials only. we'll divide that by 24. 35 cents apiece. by the way, you haven't factored in waste -- the mistakes that you make, the stuff that drips. so it's actually costs you 38 cents a cupcake. now we have 15 cents a cupcake in labor. that's 53 cents. so 53 cents is the minimum that it costs to make this before factoring in the lights, the electricity, the worker's comp, the telephone bill, and all the other things. tonnie: right. lemonis: okay?

tonnie: so i didn't know the importance of identifying those small details. lemonis: so the tip for you and for everybody else is that money is made or lost in the details. and what happens is is that when you have inefficiencies in your process -- there's just a little here and a little there and there's a small mistake there, but it's not that big -- those little things start to add up and that's the difference between in business and out of business. tonnie: correct. ♪ lemonis: free cupcakes. free cupcakes for everybody. tonight's the last night we're open. we're closing the store. woman: aww. tonnie: [ sighs ] lemonis: tonnie, we're not closing forever. you looked angry and you looked guarded. you felt that way to me. tonnie: yeah, you're right. in hindsight there was some moments where i felt like whatever's being touched upon was being pointed, like, "this is incorrect. this is wrong."

and it was all true, but nonetheless i probably took offense, which is why my response and my facial expression was what it was. lemonis: what's going through your head right now? tonnie: uh [chuckles] you know, it's just kind of sudden. i would have preferred to have some notice of some sort. lemonis: well, right now, we're losing money every day, and so i'm trying to stop the bleeding. tonnie: you don't say, "tonnie, guess what. we got 10 minutes to clear the house. we're gonna close the store." i questioned if i wanted to do this again out of embarrassment for the way i behaved on-camera. like, i never understood the e-mails i got about, you know, "you should be ashamed of yourself," i didn't get it. and then i watched it in solitude for the first time, and i got it. people tend to take advantage of my niceness. lemonis: do you think i'm taking advantage of you? tonnie: it's not as simple as a yes or no answer. lemonis: tamika, do you think i'm taking advantage of you? tamika: no. lemonis: okay. that was the yes or a no. do you think i'm taking advantage of you? tonnie: yes. lemonis: if you think i'm taking advantage of you,

it's been awesome knowing you, nice meeting you. but i don't want to be in a relationship where somebody feels like they're getting taken advantage of. tamika, does tonnie have a hard time trusting people? tamika: yes. lemonis: tonnie, why don't you trust people? tonnie: it's not that i don't trust. it's more of... opinions are in abundance. so a lot of times, that opinion, i'll take what makes sense and i'll apply it, but i may not -- like i'm not gonna say, "great idea." even with you, i would have said, "great idea. let's do it." lemonis: tonnie... tonnie: but not your way. lemonis: tonnie, you never said "great idea" one time. [ laughter ] tamika: he says it to me sometimes. tonnie: thank you. thank you. lemonis: people sign up for locations because they think more is better and they forget about all the hidden costs. i'm not in favor of this idea. tonnie: i can only accept and take but so much abuse.

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lemonis: if you think i'm taking advantage of you, it's been awesome knowing you, nice meeting you. but i don't want to be in a relationship where somebody feels like they're getting taken advantage of. tonnie: i've been accustomed for the past 20 years at running my business. lemonis: which is why i came here. tonnie: no, see, but if that's the case, then you have to understand how i feel at some point. i have no idea what's happening with the store and i have no timeline. i don't know. i'm gonna struggle with this scenario. it's not one -- it's not as easy as this may be for you. you know what? this is great. i'm gonna just kind of step back here and watch this --

'cause i know at the end, it's gonna be amazing. that i know. it doesn't take away the struggle with it. lemonis: right. tonnie: i apologize if -- lemonis: tonnie, no. honestly, that was the most honest and open you've been with me since i got here. and i'm learning to trust you more as you share more with me. it's about trusting each other. tonnie: i agree. lemonis: tonnie, i have to be honest with you, and i've seen this over and over again. one of the things that always hurts business owners is that pride gets in the way of progress. tonnie: pride has always been a gift and a curse, brought to every stance in my life, yes, that was pride behind you know you pointing out all my flaws. tamika: i think that's really the only challenge that i've had working with my brother is just to get him to kind of see things a different way. lemonis: that's right. that's exactly right. you've got to let your guard down and let people help you. hello. tamika: erenisse. erenisse: how are you? lemonis: good. so, we're gonna be closing the store tonight for the construction. erenisse: i'm so excited. i'm very happy. thank you. lemonis: it's early. we're gonna have fun.

out with the old, in with the new. ♪ all this is getting -- [ glass shatters ] ♪ i want to create a layout that's good for people who work here... lauren: excuse me. coming through. lemonis: ...and shop here. careful, guys. don't worry about the floor. ♪ tonnie: i know you got some reservations about newark, but i truly believe that if we can figure out a way to have two different locations with the same type of setup -- lemonis: but don't you think you should get one right first? tonnie: one right is easy. i'm gonna get it done. i have your support. i've got the team around me. lemonis: it's not unusual that people want to expand quickly, but if you do it too soon, it could destroy a promising business. you feel like you've done your research and you're ready to go? tonnie: my answer's yes. lemonis: okay.

so, what is this building? tonnie: this actually is 60,000 square feet of retail space coming in. lemonis: how far along are you in discussions here? tonnie: the lease was signed at this point. lemonis: a lease was signed? tonnie: it's been signed. lemonis: you see, some people think that leaving out information is going to get them further ahead. but what it does is it forces somebody like me, or any other investor, to lose faith or trust in you. the best way to do business is lay all your cards on the table. at least we can work on fixing it together. but when i walk into a situation and i learn about a lease being already signed for the first time, what do you think it does? it makes me lose confidence in what you're telling me. lemonis: you have one location that's in total disrepair and you're several hundred thousand dollars in debt and you're still feeling like this is a good idea? tonnie: i know it's a good idea. lemonis: one of the tips that we want to give tonight is that you can't sign up for things until you have your house in order. and you're creating these, what i call, "unseen" liabilities.

so you have a store that's not doing well, you owe a bunch of people money and you're signing up for what i call an "unknown" liability. and the reason i call it an unknown liability is, signing a lease isn't just the obligation of the rent payment -- it's the build-out, it's the staffing, it's the inventory, it's the utilities, it's the tax. and usually people go into things, and they sign up for locations because they think more is better. tonnie: better. lemonis: and they forget about all the hidden costs. tonnie: you're right. i mean, lesson learned. tonnie: this was gonna be, beginning here, give or take -- door's here. retail space. and the remaining part, the commissary. so, that was the initial plan. lemonis: what are your projected sales for this location? tonnie: $590 per day. lemonis: oh, so $590 of cash is gonna go through your register. how much is gonna go towards paying the employees? tonnie: we scheduled two employees for the front and in the wholesale department, there's four.

lemonis: you'll have six people that work here at an average of $10 an hour, so that's $60 an hour. and $60 an hour times 8 hours is $480 a day in labor. tonnie: okay. lemonis: how much is your rent here a month? tonnie: $2,600. lemonis: so about $100 a day on average, right? so now we're at $580. you just lost money. tonnie: it's not as simple as just saying your six staff times whatever the number you're giving me. it doesn't -- it doesn't really work that way. it may -- it may work -- lemonis: no, no, no, no. let me give you a little news flash. does work that way. tamika: that way. i have to be honest with you. in this moment, i'm not in favor of this idea. because the numbers aren't well thought out. tonnie: i can only accept and take but much abuse. lemonis: if you're accusing me of abuse, i don't appreciate it. tonnie: no, but listen to what i'm saying for a second. i've always been able to figure out how to land on the highest ground. lemonis: we're just gonna be honest. from a business standpoint,

you haven't always just figured it out. tonnie: really? lemonis: yeah, really. expansion is a great idea if you have your home base in order. i don't think you have your home base in order. tamika: okay. tonnie: where do we begin with that? tamika: [ laughs ] ♪ dun dun dun dun lemonis: just out of curiosity, let's tell america where you're sitting right now. is that a new spot you're in? tonnie: this, marcus, is where we stood that day, and i thought i would never see you again, in newark. lemonis: wait a second. that's the newark spot? tonnie: this is the newark spot. [ laughter ] it's what i thought it would be. lemonis: yeah. tonnie: and what you weren't sure of. i'm sitting exactly where you had that conversation. tonnie: all those things i did, in hindsight, were selfish. i'm not used to being spoken to any kind of way.

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tonnie: i'm just running out of patience. tamika: i mean, i will say the way that business has been run -- destructive.

tonnie: but i was doing it by myself. lemonis: tonnie, is she always looking out for you? tonnie: yes. lemonis: and, tonnie, i'm not sure that i would've stayed if if wasn't for tamika. look, i'm gonna show you guys a scene that happened on day one, and it may have been one of the reasons that i stayed. tamika: you're not saving his business. you could've just saved his life. when people loan you money and you don't have it, it can be dangerous. so when we sat down yesterday and you said certain people would get paid off, i was so happy. lemonis: it's scary isn't? tamika: yes. lemonis: tonnie, be honest, is that hard for you to watch? tonnie: it was. because i know the love my sister has for me is genuine. so to see her tear up that way, that's probably like kryptonite to me. my kids, my sister, my wife. when i see tears and i can't go and embrace or apologize --

all those things i did, in hindsight, were selfish. lemonis: tamika, do you know how much your brother loves you? tamika: yes. tonnie: she has no idea. tamika: my brother, he's been there for me, like, i'm not gonna even go into that because i will cry then. so with that being said, i know that my brother got me. lemonis: i am going to be like a dog on a bone and i'm not gonna let go. tonnie: and i think i need that. you're right. lemonis: tonnie's a frustrating guy to do business with, and i often have to remind myself that i made a commitment to come here and help not only him but his family and the people that work here. we have to prove that we can make money without adding locations, and we have to find ways to actually put cash in the bank. and until that happens, we shouldn't be doing anything else. tamika: okay. tonnie: okay. all right. lemonis: tonnie, what's your average revenue per month? tonnie: $21,000.

lemonis: what are your gross profit margins? tonnie: around 70%. 70. lemonis: okay, so you know all your numbers and you're making money. you don't owe any friends, family, or loan sharks money. tonnie: i'm very fortunate. lemonis: so you see the difference five years will make. and i'm not trying to be funny, i'm being serious. when i first met you, you didn't know any of those things. i am super, super proud of you. i decided to swing by tonnie's minis and check on the construction. what happened to, like, a little bit of work? man: a little bit of work turned into the ceiling falling down. lemonis: holy [bleep] literally fell down? man: i mean literally fell down. tonnie: hello? lemonis: tonnie? tonnie: speaking. lemonis: hey. it's marcus. tonnie: marcus, how are you? lemonis: i'm at the store, and the ceiling caved in. i felt like i needed to hold the ceiling up. every time i turned around it was like the ceiling was falling down. the entire ceiling. tonnie: okay. i'm on my way. lemonis: okay.

we play trivia all the time with our crew, and i always ask them, "what show had the smallest space we ever had to work in?" "tonnie's." tonnie: tonnie's minis. lemonis: "what was the coldest episode we ever shot at?" "tonnie's." "what was the craziest renovation we ever did?" "tonnie's." erenisse: have you done anything to bring in customers, some money? lemonis: at that point my credibility with her was on the line. she was firing stuff at us, like... tonnie: that was director versus wife. ♪ ...and we've upgraded her with a sonic shield

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tamika: you want to invest in my business next, marcus? lemonis: what is your business? tamika: real estate. i qualified to become a broker. all i need to do is take my classes, and i can have my own company. lemonis: have you always wanted to get your broker's license? tamika: yes. lemonis: and what does it cost? tamika: $1,200. i think $1,200 is the most that i've seen it offered at. lemonis: so here's what i'm going to do. and i'm being serious here. tonnie, i'm going to buy $3,000 worth of cupcakes for you to deliver to the first responders throughout new york city right now, and he's going to take $1,200 of the $3,000, 'cause i know what his margins are... tamika: [ laughs ] tonnie: true. lemonis: ...and we're going to take $1,200 of the $3,000 and you're going to get your darn license. and if you don't get it in the next couple of months, i'm going to make a show about you not following through. tonnie: that's the last thing we want. lemonis: tonnie. tonnie: hey, guys. lemonis: after the ceiling collapsed, i had to bring in extra workers and materials,

and it's gonna cost me an extra $30,000. in order for this business to work, the space has to be functional. erenisse: oh, hi. lemonis: i'm really glad that erenisse is here, because i want her to see what kind of progress we're making, especially since she's tonnie's largest investor. erenisse: let me ask you a question. so, all of this is being done. all this work is being done. have you done anything to bring in customers, some money? tamika: my sister, she fits up here with, like, superwife. erenisse: we'll have this beautiful store, and what are we gonna bring? tonnie: great product. erenisse: but if people don't know we're out there, how's that gonna happen? tonnie: so, the marketing team's gonna be pulled together. erenisse: i want to know when the money's coming in. that's what i want to know. ♪ lemonis: so, i'll give you the plan. lemonis: so, i decided that i didn't want you to get your ass whupped anymore by your wife. so i thought, "let me just step in the middle of this bullet

that's about to get shot." tonnie: you did that. erenisse: maybe it's my way of thinking. lemonis: no, no. erenisse: he always tells me, "you don't understand. i'm a businessperson." lemonis: no, no, no. you understand. we're just not as ready as we want to be. at that point, my credibility with her was on the line. i needed her to understand how hard you worked and that you were doing everything that i was asking you to do. i really felt like you had really made progress through the journey with me. she was firing stuff at us like -- tonnie: that was the director versus wife. lemonis: no, that was the investor. ♪ look at all these people. it's busy. now that tonnie is devoting 100% of his time to sales, i've set up a meeting at sylvia's to see what kind of salesman he really is. tren'ness, nice to meet you. tren'ness: welcome to sylvia's. lemonis: thank you. sylvia's is one of the most popular soul food restaurants in all of america, and having an opportunity to sell to them would be big margin.

tonnie: this is actually a sweet potato cupcake, which i believe you don't have. bedelia: that's right. we don't have. lemonis: but i think there's a good deal here for all of us, because your margins on something like this will be really, really good. i don't know what you sell a slice of cake for. bedelia: $5.50. tren'ness: $5.50, $6. lemonis: and so this may allow for a little lower price point but the same kind of margins. tren'ness: here's the thing -- i'm a little nervous about bringing them in-house. we're working on quite a few different business-development items, and we're already struggling trying to house the items that we have. i'm not certain that we would have space for these. but just from our customer standpoint, they dictate, so... lemonis: how about you and i take them around? can we do that? can we give a few away? tren'ness: of course. of course. tonnie: so the funny thing is that was my first actual pitch

to an actual owner. lemonis: tonnie, i thought you were doing great but we didn't need to talk about it, we needed them to hear and see other people loving it. that's the best closing tool ever. the proof is in the pudding. tren'ness: how'd y'all like it? woman: it's great. tren'ness: oh, good, good. tonnie: it's never been about money for me. it's always been about me loving the fact people want our product. one of the things, of course, is to figure out a way to produce an item that's gonna be exclusive to sylvia's. tren'ness: hmm. well, we like exclusive. tonnie: this would be just here for you guys. bedelia: i'm sold. tren'ness: [ laughs ] i see this absolutely working. lemonis: now, the wholesale account you have today, do you make money with them? tonnie: i do. i've set it so that my numbers actually are triple whatever it is it's going to cost me. lemonis: because of the labor and overhead that you need to factor in? tonnie: correct. and just in loss. like, there's always loss, there's returns, there's credits. lemonis: what tonnie's describing is that when you are producing a product like cakes, it's not only the cost of the product itself and the labor that it costs to make it,

there's what's called "waste" that you have to factor in. well? tonnie: that was great. lemonis: you did great. when you start to follow the process, that's what happens. tonnie: okay. lemonis: okay? i'll see you back at the store. i'm proud of you. tonnie: all right. thank you, marcus. bye. tamika: that day everything just felt right. lemonis: the store looks great. tonnie: it looks good. tamika: all those other crazy moments in between where you two were at it. lemonis: excuse me, when were tonnie and i going at it? tamika: oh! [ laughs ] let me see if i can remember. [ laughs ] ♪ with unlimited from metro and the new iphone se... ...gabriel rules. after a hard day on the job... ...he's still working hard making sure a family tradition... ...stays a tradition. get the brand-new iphone se for less than a hundred bucks when you switch to metro. and right now, get four lines of unlimited

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tonnie: would you like a sample from tonnie's minis? grand opening. grand opening one block down. tamika: awesome. man: thank you very much. tamika: you're welcome. enjoy. tamika: would you like a sample? lemonis: i'd like a sample. tamika: oh! hi! lemonis: the scaffolding outside is now gone, so you can actually see the store. tonnie: good to see you, marcus. lemonis: how are you? the space has been completely renovated, so it's bright and open. before, it was dark and cramped. now it has an efficient flow for the employees to make the cupcakes. the store looks great. tonnie: it looks good. tamika: it felt like a new beginning. i feel like that day everything just felt right. all those other crazy moments in between where you two were at it. [ laughs ] it was just a very rewarding moment. lemonis: excuse me, when were tonnie and i going at it? tamika: oh! [ laughs ] let me see if i can remember. [ laughs ]

lemonis: we finally launched the do-it-yourself. the signage is now clear and understandable. the toppings bar is easy for kids and adults to see and pick from. thank you. tonnie: this day has been an amazing day. i actually have to thank marcus and thank all of you for attending. a big part of tonnie's minis has been kind of pushed in a different direction because of the support of my wife. i'm a very blessed man to have a wife like erenisse, and i thank you a thousand times. lemonis: how has he grown as a person? tamika: like i said, being open. and a lot of that is not him being, uh, stu-- not stubborn. what's the word i'm looking for? lemonis: hardheaded! hardheaded! tamika: no. arrogant! it's not him being -- look at his face! [ laughs ] marcus, stop! lemonis: how many locations exist today? tonnie: one. lemonis: one. tonnie: the other one's closed. i'm happy i made that decision.

newark i love. it's my home. i've been here since 2007. you'd be proud because five years ago for me it was more about, how do i open up another store? right now i'm a different person. i'm probably moving as slow as a turtle with growth in general just because i'd much rather not expand too quickly and not be able to control it the way i can right now. lemonis: that's right. that's exactly right. it's more important to be there for the long haul than it is to show up and disappear. tonnie: i'm not gonna do it. i want the world. that hasn't ended. but i'm gonna get there on a different pace. lemonis: i'd rather have the long haul than a flash in the pan any day. and that is the tip that i want you to never forget. erenisse: this is really an amazing opportunity that i really never thought was gonna happen for my husband that i love dearly. i've been blessed to have him and the family in my life. and, you know, i'm just, like, grateful.

thank you, marcus. lemonis: i want to tell you tonight the reason i was as hard on you as i was is that i sensed the talent and i sensed the commitment and i sensed the dedication. and if i didn't sense that, i wouldn't have stayed. and so i want to apologize to you for how hard i was on you, to a degree. tamika: oh! lemonis: you are one of the reasons that this show exists. because you prove to people that they can accomplish anything. tonnie: marcus, thank you. i'm not gonna tear up, but coming from you, it means a lot. lemonis: well, we used to do $500 a day in business. we're now doing a minimum of $1,500 a day, and our operating costs on a daily basis are averaging around $1,100, leaving us with gross profit of $400. on an annual basis, it's about $140,000 of profit per year. woman: cheers to legacy building.

tonnie: continued success. lemonis: ta-da! [ laughter ] lemonis: it's really important in today's day -- we're all going through a lot of crazy times right now, right? tamika: because of the covid-19, you're saying? lemonis: yeah. what's one piece of advice you would give a business owner who's watching this tonight that's struggling? tonnie: make sure you love what you're doing, and that passion, during the worst days and everything that's going on in the world, we can survive. hands down. lemonis: tonnie, i want you to get moving on making those cupcakes for all these first responders throughout new york city and across the country today. and hey you! tamika: yes? lemonis: you'd better get into class or i'm gonna -- i can't say it on live television but -- tamika: i'm going to beat your ass! [ laughing ] oh, excuse me! lemonis: bye, guys. love you. ♪

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