decision to make, but we feel amazing. it really makes you believe in what you're doing. it makes it seem all so worth it. i don't know what just happened. whoo! girl power. ♪♪ lemonis: i've just arrived in cedar city, utah, and i'm here to see a business called zip kit homes. tonight i visit a company who thinks they have the solution to america's housing crisis... i'm super impressed. i'd live here and wouldn't think twice about it. ...with no shortage of demand. kelsey: they want commercial. they want residential. they want it all. lemonis: but one of the owners can't make up his mind on what he wants to be. hadin: so, it was modulars. it was kits. it was, "we want to be owner-builders. oh, we only want to work with contractors. now, we're doing development. oh, now look, there's these pods." lemonis: i think the company has an identity crisis. which frustrates the employees

and is causing a high turnover rate. how long have you been doing zip kit? jason: nine and a half, 10 months. trae: six months. gerry: since december. lemonis: and the other owner, his wife, jamie, struggles to be heard in her own company. jamie: this is a battle he and i have a lot. chris: i think what she might be thinking like -- lemonis: no, no, no, no, no, no, no, no, no. i don't need you to tell me what she's thinking. she just told us. if i can change the way this company communicates and focus their leaders, i know i can build something huge here. it's not what i expected. i'd be lying if i told you that i wasn't blown away. ♪♪ i'm marcus lemonis and i risk my own money to help businesses. i love investing in american businesses. woman: i just don't want anything to really change. lemonis: it's not always easy, but i do it to create jobs. i do it to make money. we have a deal? let's rock and roll. man: yeah! [ cheering and applause ] lemonis: this is "the profit." ♪♪

chris: i'm chris jaussi. this is jamie. jamie: i'm jamie jaussi. chris: and we build kit homes. we prefabricate panels and components in a factory here. that way, when we get to the job site, we can set it up and it goes a lot quicker. lemonis: zip kit is an innovative and exciting home building company and chris and jamie, the owners? they're rapidly changing the way people think about homes. chris: the demand is like off the charts. like we can't keep up with the demand. we have like 1,000 people on a waiting list. lemonis: but, in some cases, maybe too rapidly. we've been in and out of the construction industry for like 25 years, however, it's been a little bit of a challenge. jamie: to build more homes is our goal because we would like to. we just can't right now. lemonis: they could be the next big thing in construction, but something's holding them back. chris: we're a small company. we're doing the best we can, but we think the opportunity is so big that, with marcus's help, we could even do a lot better. lemonis: before i invest, i need to make sure this company is on a solid foundation. ♪♪

hi, there. i'm marcus. jamie: hi. how are you? nice to meet you. i'm jamie. welcome, welcome. lemonis: how are you? chris: i'm chris. lemonis: chris, i'm marcus. both: nice to meet you. lemonis: do you live here? both: no. lemonis: okay. chris: it's a model home. it's also our office. lemonis: can i come on in? chris: for sure. come on in. lemonis: awesome. thank you. jamie: you're welcome. lemonis: how many square feet is this whole house? chris: about 2,250. lemonis: so if i walk in the front door, what's to my left here? chris: so this would be a bedroom. it's our our offices. lemonis: i'm marcus, by the way. kelsey: i'm kelsey. lemonis: kelsey... both: nice to meet you. lemonis: and what do you do here? kelsey: so i do all the sales and then office manager, so whatever else comes in. lemonis: okay, great. and are these all the different models? chris: yes, these are the different models that we offer. lemonis: part of the reason that i'm interested in looking at zip kit homes is that they're an innovative builder. they're essentially a modular panel home builder, where they build the walls and, at the actual job site, those walls come together, the roof goes on, and there's a home. simplest way i can explain it?

it's like they build legos and you put them together and you make a house. kelsey: people want our homes in uruguay, all over the world. they want commercial. they want residential. they want it all. lemonis: are you residential-only? chris: 95% residential. we did a preschool. and then this is kind of a new thing we're doing right now. it's like a hotel out in the woods. lemonis: as i stand and look at the wall of all their floor plans, it's overwhelming and i can imagine that it's overwhelming for a customer as well. i think, when you look at a very successful home builder, they get down to four or five floor plans. they're not as customizable as you would like, but they allow for efficiency and mass production. in their particular case, where they're building the walls, you need that simplicity even more. chris: probably one of our biggest challenges is there's too many opportunities and us choosing which is the best opportunity. lemonis: and that's what we're going to try to figure out. chris: okay. lemonis: what's upstairs? chris: let's go see. jamie: let me show you. lemonis: okay. holy moses! jamie: [ laughs ] come in. [ laughs ] ♪♪

lemonis: i'm not going to lie. i'm kind of blown away. chris: really? lemonis: yeah. jamie: aw, thank you. that's so nice. lemonis: are they all going to look this nice? chris: yeah. jamie: this is actually the laundry room, but it is my son's office. lemonis: how are you? i'm marcus. trae: nice to meet you. i'm trae. lemonis: trae? how long have you been in the business? trae: probably past six months. lemonis: okay. i like the fact that it's a family business because it shows me that they're really trying to build generational wealth in doing this business. what i like, more than anything else, i am blown away by the fit and finish of this interior of the home. this thing really has a lot of attention to detail and just because the side panels for the exterior walls and the roof and some of the interior panels are made offsite doesn't make the house of less quality. ♪♪ jamie: this is our master bedroom. we made it into our design center. ♪♪ lemonis: i'm super impressed. chris: thank you. jamie: aw, thank you. lemonis: the home that we're standing in,

as shown right here, what's the retail price of this home? chris: maybe $300,000, $320,000, $280,000, somewhere in that range. lemonis: the magic behind all of this is that you can design the size home that you think works for you, based on your budget. the cost to actually do these homes is going to be about 50% less than what it would be to build a traditional home, and about 50% less time to actually get it built. what they've essentially created here is an affordable housing solution. it's not only efficient, but it's done quickly and it has the beautiful aesthetic to go with it. ♪♪ so what's this building? chris: this is where the production goes. lemonis: i wanted jamie and chris to take me over to the manufacturing facility, so that i can understand each step along the process, ultimately, seeing if there's opportunities for efficiency and how this business could scale up. chris: this is where all the raw materials come in. lemonis: how are you doing, brother? i'm marcus. nice to meet you. what do you do here? joshua: i work the saw. lemonis: and so raw material into whatever spec you're being asked to.

joshua: yeah. lemonis: alright, so, starting with the raw materials, based on the design that's fed into the system, he knows what to cut. ♪♪ let me give you an idea of what zip kit homes does. if we start with a stack of lumber, they essentially get cut to a specific drawing. if it's a 2,200-square-foot home, each individual wall is going to have its own schematic. those walls get built. they get assembled. they get put on a truck, delivered to the home site, and, when they arrive at the home site, they're unpacked, the walls are stood up, the roof is put on, and a local contractor comes in and finishes the interior, which would include... and then, the final piece is that zip kit delivers their finishing package, which is all the... ...ultimately, cutting out a ton of time and creating a ton of efficiency. alright, brother. cody: good. how are you doing? lemonis: i'm marcus. cody: i'm cody. lemonis: are you working off a drawing? cody: so, actually, we're working off these screens right up here.

lemonis: okay. how many homes a week can you crank out of this building? chris: one to two a week. lemonis: okay. so i love the fact that you're doing these times. what are you doing with the information? chris: we want to get faster. lemonis: what's their incentive to get faster? other than, [ patting back ] "good job." i really want to understand the labor and what their motivation is to crank out more homes. factory workers and workers like this are all motivated by their ability to perform and get paid, meaning that, the better their performance, the more they'll get paid. chris, i think, has made a fatal mistake here, where he's paying people the same amount, regardless. what's their motivation to actually increase output? there isn't any. how long have you been doing zip kit? jason: nine and a half, 10 months. lemonis: what do you do here? gerry: sort of the shop foreman, trainer, consultant. lemonis: how long have you guys been together? gerry: since december? right? right. man: yeah. lemonis: so there's a lot of new team members. man: there are, yeah. lemonis: it is a little odd to me that, for a business that's been out there for years,

many of the people that are in the factory are new. and i don't know if it comes from a morale problem, a labor problem, a supply problem, a pay problem. but i am going to have to figure out what the problem is because, if demand has 1,000 people with orders and they're not able to meet them, there is a cog somewhere in that wheel. anytime i look at a business, i try to really understand, "where's the soft underbelly?" what are one or two things that you think the business doesn't do well at all? hadin: i think one thing, from my point of view, is chris is a very creative guy and he's constantly shifting what we're doing. so, it was modulars. it was kits. it was, "we want to be owner-builders. oh, we only want to work with contractors. now, we're doing developments. oh, now look, there's these pods." since i've been here, we've probably went through seven or eight different strategies that he thinks would be best and he just can't seem to focus on one, even when it's going well. he's focused on what's going to be more profitable, but not ever giving anything a chance to fully develop. lemonis: i'm a little concerned about what i'm hearing about chris being all over the place.

they're not even really sure who they are and why they do what they do and providing that clarity not only provides job stability, but it provides job opportunity. i wonder if part of the reason they have turnover so much is because people don't know what they stand for or where the company's going. now that i understand the business a little bit better, i'd like to sit down and go over the numbers because, ultimately, the financial opportunity is what i'm interested in, here. let's jump into the numbers. jamie: okay. lemonis: so total revenue in 2020... chris: so your cost of goods sold is... and then, the gross profit is... lemonis: and you only lost... the expenses are not light. chris: i know. so -- so -- lemonis: $763,000 of expenses just sucked all the capital out of the business. chris: yep. lemonis: and the business didn't start with a lot of working capital, either. chris: i mean, i had $3 million worth of construction loans, plus suppliers and... jamie: it was bad. it's hard to talk about, still.

[ crying ] he'd come home and say, "guess what. we could lose everything." lemonis: did you end up having to go through bankruptcy? chris: no. jamie: no. we chipped away. chris: we chipped away. jamie: yeah. that was really hard on our marriage. lemonis: i want to say one thing to you both. chris: sure. lemonis: pretty much breaking even in the middle of covid, i think most people would be like, "where do we sign up for that?" do you have a balance sheet? chris: yeah. lemonis: okay. there's only one other way to make a balance sheet healthier, other than profits from operations. paid-in capital. and so let's really understand what liabilities, if they didn't exist, would make the business more profitable. okay? $170,000. that's the payables. the credit card balance... and the short-term friends and family loan of... those three equal $432,000. chris: right. lemonis: okay. and i want to tell you something. character is defined by the weakest moments in your life, not the strongest, and a character-defining moment

was when you were at your lowest point and you dug out of it as a team. what i would like to do right now, i'm just going to sit outside, take a look at all this, understand the balance sheet, understand the p&l, and we'll reconvene. okay? chris: sounds good. ♪♪ ♪♪ lemonis: i think, in a very short amount of time, you guys have built a nice business. the concept is working. i am definitely interested in investing in this business. i mean, really interested. chris: that's cool. lemonis: the risk in this deal, in my mind, is the revolving door of people. sure, the process can be dramatically improved. i think you can get way more out of this box than you do today. but it really is creating stability within the shop

and creating stability within the front office. chris: there's no doubt about that, so. lemonis: what do you think the business is worth? chris: $3 million. lemonis: okay. i don't think your business is worth $3 million. [ suspenseful music plays ] so my offer's $1 million. i want 30% of the business. and i want all the employees to own 20% of the business. ♪♪ you have this dilemma of like, "who are we?" "this is the vision of the company and this is where we need to go." if your wife doesn't feel good about somebody that works there, that voice should be heard, regardless of what the guy in the shop thinks, because he doesn't have his whole life at stake. ♪ ♪ remember when no dream was too big? ♪ ♪ and you could fearlessly face the unknown. (kids playing) you still can.

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because my vote and their vote is going to be stronger than your vote. chris: be equal. lemonis: it'll be equal on paper, but it won't be equal in reality because, if everybody, all these people chris: that's true. lemonis: ...are saying this is a bad idea and you still do it, then we're going to stop following you. it is true we have a bit of a tie, but the tie should go to the quantity. chris: i agree. i'm okay with that. lemonis: is that okay with you? jamie: i think it's okay. ♪♪ lemonis: have you ever looked at an esop? an esop is an employee stock ownership program. an esop allows the current employees to have a vested interest in the business itself. i want this company to partially be owned by all of the employees. chris: okay. lemonis: that mitigates the risk that i see here of the revolving door. it is a condition for me that is really kind of, principally, my only condition. jamie: because we do have some employees we'll go, "okay, let's give them a week trial, two weeks... chris: then we let him go. lemonis: there's a program that allows for people to come in and out

and they don't enjoy the same benefits. do you want to not do the esop? ♪♪ chris: no, i want to do the esop. jamie: okay. i want to learn more about that. i just -- this is a battle he and i have a lot. there are some employees that i'm always like, "why do you still have them working here?" chris: i think what she might be thinking like -- lemonis: no, no, no, no, no, no, no, no, no. i don't need you to tell me what she's thinking. she just told us, if we're going to take 20% of the company and allow there to be an employee ownership program, she wants to make sure that the people that are eligible for that are people that she wants here. jamie: exactly. lemonis: and it sounds like, if she was running the business, there'd be some people that would be outside. chris: could be. lemonis: so my offer is $1 million for 50%. i'll own 30% of the business and the employees will own 20% of the business.

chris: let's do it. lemonis: that's it? chris: that's it. lemonis: you got to have some questions. chris: i think it's a fair offer that you gave us. ♪♪ can we do it? jamie: mm-hmm. chris: okay. ♪♪ jamie: good. it's good. [ laughs ] lemonis: we have a deal? ♪♪ chris: we have a deal. lemonis: okay. chris: we have a deal. lemonis: thank you. jamie: thank you. ♪♪ lemonis: today, i'm visiting a site in idaho where zip kit actually has a large development happening and i've really only seen their manufacturing in their facility and the one model home and it's important for me, as i think about scaling the business, to see what they could do on a grander scale. chris: you found us. lemonis: i got to tell you, this is a cool project. chris: here's the thing about this project. there's a guy that owns a ski resort here. so he came to us and he said, "i've got six months to get housing for 100 people."

it takes a year to build one of these in driggs and here we are, four and a half months into it. we're going in the back door here, right? so, you come in. this is going to be their living room, right? it's all one color of paint. lemonis: this is an aesthetic or is this a support beam? chris: it's both. lemonis: i love it. that looks good. adds character to it. chris: so here's your bedroom. lemonis: i got to just tell you, this is a nice place for an employee to stay for a season. ♪♪ from my perspective, very few businesses that i've come in contact with, this early in the process, you have the knowledge and the expertise, you work your ass off, so there's no like part-time in it for you. chris: no. lemonis: okay. quality of the product is superior, in my opinion. i told you that from the first day i met you. chris: tomorrow, i'd say. you're up, man. lemonis: i'll see you back at the ranch. chris: okay. thanks. lemonis: bye. chris: okay. bye-bye. [ suspenseful hip hop plays ] ♪♪ lemonis: marcus. chaney: i'm chaney.

lemonis: chaney? nice to meet you. now that i've seen the job in idaho, i now want to understand what a commercial job looks like, so we're visiting the school in salt lake city that they've built. this is fascinating. chaney: i know. it's so cute in here. i love it. lemonis: the quality looks pretty... chaney: amazing. everybody loves it, yeah. lemonis: like that testimonial. so, as i sit in here today and i hear a satisfied customer, then i'm saying like, "okay, you have these regular homes, you have these pods that you want to build. then, you have this commercial issue out there. now, you have this dilemma of like, "who are we?" chris: i know i've been like add my whole life, so i see a lot of opportunities and it's hard for me to go, "here's an opportunity, but i'm going to only focus here." lemonis: you pick a lane or do you just build a bigger highway? part of the issue in this company is that chris has all these ideas and i know that he's looking for different opportunities, but we got to get them narrowed down to do one thing. in this particular case, what you've done is you've just destroyed the consistency of the business

by throwing in a random project. i got to get chris to understand. we got to narrow down the focus. we got to figure out what we're going to make, so that everybody understands what the purpose of the company is. it's to make affordable housing for americans. i think the company has a slight identity crisis. jamie: sometimes things he talks about, people don't understand and i'm the same way. i'm like, "okay, just explain it to me, so someone simply can understand exactly that breakdown." lemonis: you're a really smart guy and, at some point, you have to say, "listen, i have a lot of ideas. i understand that they all can't be satisfied today, but this is the vision of the company and this is where we need to go." chris: i don't think there's a lot of people that would say, "hey, let's expose everything about your business and you and your challenges and what you're good about and bad about and not so good about and let's put it on tv for everybody to see it." lemonis: what is it that you're so fearful of? chris: we're talking about my personality and things that i haven't done well and things that i could do better, and things like that. lemonis: and that's what you heard,

as opposed to me telling you how smart you were? i'm now starting to see some of the frustration that people have with chris, where, when you give him feedback, he gets defensive because he tends to only hear the negative stuff. in this particular case, the business just needs to be focused, and that includes chris. and it's not a negative criticism. it's a constructive criticism that will allow the business to be more successful. ♪♪ jamie: we have some old-school employees. they don't like to listen to a lady. lemonis: why is that person still there today? jamie: that's not my choice.

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ful music plays ] cmy personality and things that i haven't done well and things that i could do better, and things like that. lemonis: and that's what you heard, as opposed to me telling you how smart you were? chris: i know, you did. you've complimented me a lot. lemonis: that's how i feel. i feel like you're a really smart guy with an unbelievable vision. chris: okay. lemonis: i just feel like you'd struggle to tell everybody what that vision is. chris: i learned that we don't have an extremely clear vision of where our business is going. maybe i do, in my head, but it's not clear for everybody else. lemonis: we can fix it. chris: okay. lemonis: okay? chris: easy to do. lemonis: okay. well, i don't know about easy, but, it's possible. ♪♪ good morning! chris: morning. lemonis: how's everybody doing? chris: doing great. lemonis: who's enthusiastic? chris: we're excited. jason: we all are. lemonis: the reason that i brought you

to prime machine -- they've been in business since 1979 and they build everything from small parts to rockets. chris: cool. lemonis: and the reason i wanted you to come is i wanted you to see inside, how important the process is to them. and i think it's important to understand that machinery is key, but process is key. if you make one more home a week, how much revenue is it? chris: $1.2 million. lemonis: pretty meaningful chris: it's a pretty big number. lemonis: amount. what do we need to do to make, at a minimum, one more home a week? chris: we need a better process. lemonis: alright. let's go inside and take a look at it. i want to take them to a place to understand how efficiency in machinery and production can actually help their business grow. as you look at the layout of their 16,000-square-foot building, there's a lot of empty floor space, so one of the challenges is going to be to figure out how we get more production out of this box. with the right investment in technology, with the right flow in and out, can you jam this building that we have already to do a lot more in the smaller space? so this current flow is doing one to two a week. one of you write out for me

how you get to five a week in this building. chris: okay. jason and i have talked about another framing table. this is the bottleneck right now. we can only frame, you know, not nearly as much as we can cut. lemonis: but, ultimately, if there was a way to add a barrel building right here attached to this building, you're able to bring in the raw lumber, so you can buy it in truckloads and keep it here, and then, they can literally just come in, get cut, and go in, right? chris: yeah. i mean, if we could make that work... jason: i don't see any reason why it couldn't. chris: i mean, the shop is like this. there might be a way just to do an add-on that's just like that, that's pretty inexpensive. you know what i'm saying? jason: this right here would double production, just right here. chris: even triple. lemonis: with not a lot of nothing. chris: yeah. lemonis: when you're dealing with a business that's working so hard and pedaling so fast, they sometimes can't see the obvious things in their business. it ultimately doesn't allow for the efficiency of the building to come to light. chris: [indistinct] really fast. lemonis: make us all a lot of money really fast.

chris: yes. lemonis: which i'm not opposed to. chris: i like that, too. lemonis: okay, good. i just wanted to check. ♪♪ one of the conditions of my million-dollar investment is that 20% of the company be owned by the employees and i know that jamie and chris have some hesitation, so i've lined up an esop lawyer to help them understand, step by step, how it actually works. jamie and chris are owners of a business called zip kit and they've built an amazing business, in my opinion. they have had some issues with turnover, right? chris: mm-hmm, we've had some, yeah. lemonis: i think the key, for us, is really understanding how to build retention, long-term retention, for the team members. john: absolutely. so, this could be like a game-changer for growing your team like over time and having the people stay onboard and be really invested and engaged in what you guys are building. i see you already are nervous about this. jamie: [ nervous laugh ] i don't want them to think they sign up and then, they get this automatically.

it has to be earned because -- john: and why are you deeply concerned about that? jamie: because we have some employees that come in and they could be working harder. lemonis: that's honest. john: sure. jamie: it's true. john: this type of stock ownership plan is really great for stuff that you're concerned about, okay? because nobody's getting anything day 1. they're going to have to stay with you and they're going to earn their percentage over a number of years of being loyal and staying with the company. lemonis: i think there's two separate issues here. number one, if you have people that work there that, you don't want to have them work there anymore, you should deal with that independently. secondly, when people are given equity in the esop, they need to vest over time, which means, while they're given something, they still don't actually have the right to redeem it until a period of time. in my particular proposal, it would be a 4- or 5-year vesting period, which means that, if i gave you 10% of the business, you would earn it over time and you wouldn't be fully vested or have full ownership until that time horizon was met. what this plan does -- and i've argued this to my death with people -- giving people equity, it's a self-motivator.

but there are certain people on the staff that you would prefer didn't work there. chris: yes. lemonis: okay. jamie: we have some old-school employees. they don't like to listen to a lady. that's hard for some of them. lemonis: why is that person still there today? jamie: well, [ laughs ] that's not my choice. lemonis: why isn't it your choice? jamie: ultimately, he fires and hires people. chris: well, but not so -- i mean, there could be somebody that's in the actual factory, okay? that maybe jamie says, "i don't know why we're keeping this guy," and then, i talk to jason and cody and they're like, "no, we really need him." lemonis: i hear ya. why is that one or two people still working there, if you strongly are opposed to it? jamie: because, like he just said, jason and cody feel like he should be there. chris: jason and cody are in the factory, working. i have to assume that they know certain things that, you know, maybe jamie and i don't know. [ suspenseful hip hop plays ] ♪♪

jamie: chris bounces a lot of his ideas off on me and a lot of you don't know that. chris: what i see is the guys assembling aren't respecting the designers enough. kelsey: i've brought this up to you, right? i've told you. you just don't listen to me. lemonis: i'd like to order two. i'm trying to find a way for the pods to complement the business. chris: there's a lot at stake because this was under a really tight deadline. we haven't slept a lot in the last couple of weeks, to get these done. lemonis: if you're looking to take your business to the next level, log on to... "colors" by black pumas come in for a soccer ball.

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[ suspenseful music plays ] if my wife, or your wife, or whoever, doesn't feel good about somebody that works there, that voice should be heard, regardless of what the guy in the shop thinks, because he doesn't have his whole life at stake. this is really the first time that i'm hearing,

loud and clear, that jamie doesn't feel like people respect her or listen to her opinion, and i'm even more concerned because, while she doesn't say it directly to chris, she's looking at him in a way, saying, "you're not really listening to me." the first time i saw it was when i made my offer to invest in the business and chris so quickly [ snaps fingers] said yes and jamie had some hesitation. the one thing i will make very clear to everybody, including chris, is that, if one of the owners of the business -- which jamie is -- has an opinion about the way the process is running, the people that are working there, the equity, we are going to listen. i don't want anybody in the building -- i don't care who they are -- just shushing you to the side. chris: got it. john: which is another reason that, if you've got any, you know, bad apples or anybody that needs improvement, you take care of those things, first, and then do this. lemonis: or, said differently, if there's anybody that needs to go, now's the moment to do it. chris: right. jamie: okay. lemonis: that work? jamie & chris: yes. jamie: perfect. lemonis: thank you so much. john: i'm here to support you guys. lemonis: great. ♪♪

i put a lot of time into our conversations around the employees and making sure that we create a stable work environment as we grow. this is a unique situation where you have a successful business that's bursting at the seams, that has a lack of communication, but not terrible. i think it's helpful to always bring somebody in, a "professional" from the outside, that can help communicate both sides' points of views and just get whatever open issues are out there resolved and put to bed, once and for all. chris: i'll meet with your facilitator. lemonis: today, though. chris: oh, okay. lemonis: i know that chris likes to control things and i know that jamie feels unheard. what i really want to hear now is what the employees think. [ indistinct conversations ] how's everybody doing? employees: good. lemonis: good? it was really important to chris, jamie, and i that everybody really talk about how they feel about the business today.

and i want to make sure that you feel like your voice is heard. and the only way we learn how to respect people and communicate better is if we just get more information. so adam is here to facilitate. adam: cheers, marcus. so, when we're opening this conversation up, it's not about right or wrong and we're not looking for validation here. it's pure feedback, so just share openly. share how you feel about the business -- what's missing, what's working, what's not effective, what's effective, things like that. lemonis: so what concerns you about the business? cody: for whatever reason, like we're killing it out there right now. designers, operations, sales, like they can't keep up with us and i don't know if it's because they don't have incentive. chris: what i see is maybe the designers don't respect the guys assembling enough and the guys assembling aren't respecting the designers enough. adam: there are platforms for communication that create a common language that you can all communicate through, so there's a better understanding. have you ever used anything like that? are any of you familiar with disc,

the myers-briggs or the, you know, enneagrams and the big 5s and things like that? kelsey: i very much want to get this team on. i love that type of stuff. adam: got it. kelsey: but they think i'm just a hippie, so. [ laughs ] lemonis: what i would ask that you guys think about was that, if she has an opinion about something, that it isn't dismissed and it isn't put off to the side. that's part of respecting people. adam: this isn't some mumbo jumbo stuff. this is things that have had scientific proof and validation and reliability kelsey: [ laughs ] adam: since the 1940s and, you know, even earlier, right? kelsey: i've brought this up to you, right? i've told you. jason: i know. kelsey: you just don't listen to me. [ suspenseful music plays ] lemonis: just walking up for the first time and seeing it, it's not what i expected.

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"colors" by black pumas come in for a soccer ball. leave a part of the team. what we value most, shouldn't cost more. [ end music ] ♪ ♪ ♪ small decisions make a world of difference. ikea. introducing the new citi custom ℠ card. it adapts to you. earn 5% cash back that automatically adjusts to your top eligible spend category, up to $500 spent each billing cycle. and $200 cash back after qualifying purchases. apply now. visit citi.com/customcash kelsey: i've brought this up to you, right? i've told you. you just don't listen to me. jamie: i think a lot of them don't understand -- if i can say something -- maybe i'm not here at the office every day, but chris bounces a lot of his ideas off on me

and i'm the one that usually says, "yeah, that's great," or i'm the one that says, "no way," and a lot of you don't know that. that was my big concern in the beginning. i felt disrespect from my employees. they see me walk in and, especially in the factory, they don't know who i am and, when they find out who i am, there's a change. lemonis: it's chris and jamie. because they both have their ass on the line. they both have put blood, sweat, and tears into this business, and we need to make sure everybody in this room understands that jamie is an equal owner, just like chris is. they may have different roles and different responsibilities in the business, but they carry the same stick. are we clear about that? okay. i think not everybody has seen what i've seen, as it relates to jamie. they don't really give her the credit that she deserves and they don't understand the role she plays. and they, more importantly, don't understand the sacrifices that she's making. i think part of improving communication is having the patience to communicate.

adam: thank you, guys, for having me here and the opportunity to make a difference. lemonis: thanks. cody: yeah. thank you so much. lemonis: thanks, really. ♪♪ chris: whoa! lemonis: how you doing, my man? chris: i'm good. how are you? lemonis: how are you? it's been a few weeks since the employee meeting and i've really been working hard to try to understand where the market opportunity is for this business. and one of the things that i've really honed in on is can this business start to make smaller-sized, replicatable homes that are affordable and do i need a brand to attach to it? the last couple of weeks, i spent a lot of time on this business. i went to new york to meet with authentic brands and authentic brands controls the license for eddie bauer, nautica, and i said, "i can build you three 400-square-foot nautica pods along the lake and i can bring you eddie bauer pods in a campground setting or in a mountain setting,"

that's sort of what i've been doing for the last couple weeks. chris: interesting. i like it. yeah, i really like it. that's way better, a much better business model. you know, whether it's a panelized or a modular unit, i mean, we need to figure that out. i kind of have my ideas and maybe, you know -- lemonis: what do you consider the pod out there? chris: that's like a modular. that's a pod. lemonis: can we go look at that real quick? chris: yeah, let's go look at that. this would come just like this. this would come on a trailer with some jacks or a crane. we take it off and people can be living in it tonight. lemonis: this is one right here, right? chris: yeah, this is one. it's not done, but it's all -- lemonis: is this a proto? chris: kind of. it sold. it's always sold, yeah. lemonis: it is sold. chris: but it's kind of a prototype. lemonis: so how long do they take to build? chris: week and a half. we can crank them out. this is a hotel room, basically. it's a hotel room with a little kitchenette. so this, i mean, you got your queen bed, your tv on the wall right there. you have the skylight above your queen bed. lemonis: remind me of the cost. $60,000? chris: the cost or what we would sell? yeah, $60,000, less cost.

lemonis: what do we sell this for? chris: $95,000. lemonis: after doing more research with contacts that i have in the industry, it really did become clear to me that these pods could be, actually, the gateway to making a lot of money. i'd like to order two -- one that could be a nautica-type deal, one that could be like an eddie bauer campground-type deal. chris: you got to tell me what price point we got to be at. jamie: lower, smaller. chris: no. what could we sell them at? lemonis: what i would rather do is build them. you charge me whatever you think you need to charge me because we want to keep the business right and we take them and we don't talk to them about price. i'm trying to find a way for the pods to complement the business. what we're going to try to do is make two prototypes. jamie: okay, so if we were to go for an eddie bauer, let's start with that, first. what one would you guys take out of here, to start with? ♪♪ chris: you guys don't like that, huh? jamie: okay, that one's out. lemonis: i didn't want to use that opportunity to make it all about design. i wanted to make it all about communication and collaboration.

feel good about that, generally? jamie: yes. chris: what about colors? kelsey: i see like these colors, to me, could be cool. lemonis: but it was also a demonstration in how jamie can add value and how they can see why they should respect her. not just because i'm saying so. so jamie and kelsey are going to lead the charge on picking the final designs, from a material standpoint. jamie: we can do that. ♪♪ [ suspenseful hip hop plays ] chris: i was hoping we could maybe put that cabinet, just screw it to the wall, just anything at this point, right? so we brought these up yesterday. marcus asked us to build two. so, this is our nautica model over here, this is the eddie bauer model, and this is our sleeping pod. ♪♪ kelsey: clearly, it's not finished. we're still very much in the middle. you got to see what it's done. ♪♪ jamie: this one's been really hard for us because we've just been [ snapping fingers] go, go.

the bathroom sink needs to be wiped out, too. chris: huh? jamie: bathroom sink. okay, i'll be back. kelsey: let's put these chris: let's get done kelsey: on the u-haul. chris: what we can get done in 10 minutes, and that's it. to me, there's a lot at stake because this was under a really tight deadline. this showcases our work, but in a few weeks, hurry and build these has been a huge challenge. let's just put it that way. we haven't slept a lot in the last couple of weeks, to get these done. ♪♪ lemonis: i have a lot of anxiety, heading into salt lake city, because the two homes that i've asked to be made are apparently done. the final verdict was that they were going to be no more than 400 square feet and they were going to have one nautica version and one eddie bauer version. i haven't given them a lot of time to do them and it's new for them. ♪♪ just walking up for the first time and seeing it, it's not what i expected. ♪♪

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♪♪ lemonis: just walking up for the first time, and seeing it, it's not what i expected -- in a good way. good. lemonis: you guys are going to take me through them? jamie: yeah. chris: this is built on an rv trailer frame. lemonis: i'm dying to go up here. jamie: i don't like heights, but this is kind of my favorite part of the whole thing. lemonis: this... is so awesome. i'm liking what i'm seeing,

because it shows me that there is a real attention to detail. and when everybody's rowing the same boat, things can happen fast, and they can get done really well. you took a confined amount of space. how many square feet is it downstairs? chris: 399. lemonis: just to get under the rv certification. the deck should be 400 square feet, because it's the same footprint as below. and the deck adds probably about another 200. chris: yeah. 250. lemonis: so, you're talking about 1,000 square feet of living space, even though, for certification purposes, there's only 400 square feet of closed-in space. chris: correct. jamie: yeah. lemonis: what do you think the final retail price would be, as shown here? chris: $160,000. lemonis: but is that because of the time frame that i gave you to do it in? chris: part of it. lemonis: to me, i think this looks like $125,000, $130,000. chris: that could be. lemonis: but it's a home. chris: yeah. it's a full home. the garage door, i mean, that's 6 grand just for that garage door. lemonis: yeah, but -- but look at the value. chris: yeah. lemonis: i mean, this, to me --

chris: it's cool, huh? lemonis: no. it's more than cool. you're trying to make it a more expansize space. and you solve a problem with something more creative than anybody would have thought of. i think they're unbelievable. exactly what i thought would happen with the business has happened, where their creativity has really come to life. and what i see now, with this finished project, is that, when they're put under pressure, and when they're given a strict deadline, and when they're given a laser focus, they can deliver. so, this is my second bed. jamie: it's a trundle bad, basically. lemonis: now, you've just created sleeping for two. chris: yes. jamie: yes. and then, this island i got, so guess what? it rolls. so, you want to move it out of the way. you want to put it on the deck. you want to keep it inside. lemonis: well, i can see from here that you clearly were involved, because the aesthetic feels thoughtful, even when you mention things like this, as a mom. you mentioned the double beds, there, as a mom. you can feel your influence. chris is one of the most talented, creative people that i've met, but jamie is equally as talented. and together, as a team, with good communication --

both with each other and their team -- they're unstoppable. to be honest, i didn't think you guys would show up with them. chris: really? lemonis: with the way, how difficult it is to get wood, and metal, and workers, i'm looking for things to find wrong, and i don't see them. jamie: when he commits to something, we're committed. lemonis: he wouldn't have done it without you. chris: no. jamie: oh, no. lemonis: would not have been possible. chris: no way. lemonis: and i don't think you recognize the value that she could bring to the overall business to the extent you do for them. chris: that's fair. lemonis: yeah. i think my biggest concern -- were are we gonna get all these people from, to build them? chris: we need more people. lemonis: you're gonna need more people tomorrow. chris: and we need the right people. lemonis: yeah. i would get on ziprecruiter. i would even go onto ziprecruiter, and create a zip kit account. put job postings on there. and what's nice about it is, when you post the job, it's able to actually match people with their skill set. as opposed to you having to look through different people that are looking for jobs, it takes the employer and the employee --

the potential candidate -- and it recognizes, through their algorithm, the qualifications that they have, and all the skills that they have, and it matches it up with the employer. the other option is, as the employer, you can invite to apply. so, if we're looking for designers, wall builders, salespeople, interior designers... chris: okay. i'll do it. lemonis: alright, let's look at the other unit. chris: okay. so, this one is the eddie bauer one? chris: this is eddie bauer. yeah. lemonis: look at the size of that window. chris: kelsey was the designer on this one. lemonis: it looks totally different. kelsey: you asked for rustic. we have you rustic. and you wanted us to incorporate the brand, so i found some, like, old, historical photos. lemonis: that is cool. kelsey: that's actually eddie bauer. lemonis: come on. kelsey: i brought in the brand, lemonis: the aesthetic in here -- it's next level. kelsey: i just love the classic, retro stuff. i think it's cozy and cute. lemonis: oh, i love what you guys did here. i think this is great. what do you think the retail is on this? chris: i think just under $100,000. $95,000, $98,000, something like that.

lemonis: i think what i like more than anything else is the price points. the nautica unit, which is the double-decker, could be around $1,000 a month. and the eddie barry unit is going to be in the $650 a month range. so, i asked you guys to make two units, and then, you decided -- because you were bored -- to build a third one. chris: yeah. so, let's take a look at that. what's even more impressive is that i only asked the company to make two, but they took the initiative, as a team, to make a third unit. and this can come in different colors. chris: different colors, yeah. full-size bathroom. jamie: it could be an office, but i mean, it's a sleeper pod. chris: i've already had people asking me for really affordable housing -- like, homeless people, things like that. this is a pretty cool design. lemonis: how much would this be? chris: $30,000. lemonis: $30,000. this is awesome. how long did this take to build? chris: we could build this in a week. lemonis: the test was, can they work under pressure? can they be creative? and can they all respect jamie? and i think the answer to all of those is "yes."

and you can see that with the finished product. this is probably $25 million to $30 million of business, easy. for me, chris, i think the thing, more than anything, when i met you guys, i don't know that the direction was clear. chris: you're right. lemonis: and i think, now, big volume, bulk, of the same thing works. it's like, it's easier for them to do 50 of these than it is for them to come in -- people come in, and like, "oh, i want these kind of cabinets." it's too much. chris: yeah. lemonis: and i think, to see everybody on the team participate, and do it together, and build strength, all of a sudden, it's like, "we now have some sort of direction." alright, guys. thank you for an amazing journey. great job. i'm proud of you the most. you kept us together. jamie: thank you. lemonis: bye, guys. we'll see you. the strongest message that everybody should take away is that, if everybody stays in their lane, a lot can be done. before, they were making schools, and they were making track homes,

and they were making custom homes. i want chris and his company to do what it does best, which is design, market, and manufacture. i think, literally, there could be thousands of these made a year. they did $5 million last year. this business should do $25 million in the next 12 months. ♪♪ ♪♪ man: ♪ whoa oh oh oh ♪ ♪ you can start again ♪ -♪ start again ♪ man: ♪ whoa oh oh oh ♪ ♪ start believing ♪ -♪ believing ♪ lemonis: over the years, thousands of businesses have applied for help from me. but with the pandemic, every kind of business is feeling the struggle. and now i want to help more than ever. and so this particular business is called grey block pizza. it's located here in santa monica, california. and they really specialize in all sorts of pizzas. what they also specialize in is drama. let's take a look. thomas: home of bagel crust pizza, home of the salad pizza. lemonis: um, is this for real?