it's the ultimate wifi experience. xfinity xfi, simple, easy, awesome. good morning. coming up on msnbc's "your business," this michigan ferry service had more customers than they could handle and it was sinking their business. the changes they had to make for the future. the telltale signs an employee is embezzling money. when it comes to making choices for "your business," we have your back. that's coming up next on "your business." announcer: msnbc "your business" is sponsored by american express. don't do business without it.

"your business" is sponsored by american express. don't do business without it. hi there, everyone. i'm j.j. ramberg. welcome to the beginning of the 13th season of "your business," the show dedicated to helping your growing business. picture this. one of your competitors gets bought out and customers are giving your company a shot. sounds fabulous, right? not always. the family who owns a michigan ferry company thought they were ready for business until passengers showed up in droves and they realized there were rough waters ahead. >> welcome aboard. ♪ >> it was a wake-up call.

it was everything from a slap in the face or kick in the butt. we tried to organize ourselves, but did we really nail it? no. we didn't. >> the summer of 2017 was one for the record books at shepler's. not in the way the family would have hoped. >> did we think it was going to be like this? we never thought it would be like it is. >> it was to the point where, holy crow, we have never seen anything like this. >> far from smooth sailing in the straits of mackinac that year. >> we scrambled and did our best to take care of everybody. on busy days, things fall through the cracks. >> passengers felt it and they were blunt in their disappointment in what the company calls first class service. >> she says i expect more from shepler's. how do you answer that.

i said, ma'am, my name is chris shepler, what can i do for you? she said nothing, i just expect more from you. >> it is the first time only two companies were serving mackinac island. chris and his sister patty and brother, billy thought they were ready for the passengers on the boat. they were wrong. >> it exploded. the whole time you were going full tilt. >> the siblings who run the company saw the trouble almost immediately. with the season in full swing, there wasn't enough time to tackle the problems they suddenly faced. >> it was quite evident, the end of june, beginning of july, oh, we have our hands full. we kind of dealt with the growth on a day by day basis. when you think it is over or it's easing up, it's not the case. it basically down shifts and

keeps ongoing. >> the number of visitors to the region jumped only adding to the turmoil. >> we talked about it. did it really sink in? did we understand what that increase would do and how it would impact us on a day-to-day basis in a six-month a year company? no. >> the company, which started in 1945 by their grandparents has had a following for generations. seeing customers firsthand was upsetting, knowing their personal reputation was online with the family name on the side of every boat. >> that pressure of only seeing them twice maybe every year, maybe every other year, you only get those two chances to make an impression. if we don't do it right, you know, will they come back? they might come back to mackinac island, but will they ride our service? maybe, maybe not. >> forcing people to pick up a

paper copy of their ticket after buying it online were a few of the problems. the business was missing consistency and it hurt customer relations. >> you never complain about growth, but you have to think about it as the growth can't complain about you. think about not what's best for the company, think about what is best for the guest. that's what's best for the company. >> community leaders didn't like the problem they were having, either. chris was take ton task for it. >> they call me into the principal's office a couple times and met with the city manager as well as the chief of police. they said what are you going to do about this congestion? i said i don't have an answer for you right now, i really don't, but i will. we have failed in areas we will try to get better at. >> they were getting complaints from all sides with no relief in sight. if they made changes, they risk losing long-time customers. if they did nothing, there's a chance the brand was hurt in the

future. they had little choice. they made $4 million worth of improvements using their own cash and borrowing money. a newly paved parking lot cost over 1 million including signs and trams to bring them to the dock. these money matters kept chris up at night. >> every decision on what we were going to spend, whether it was a lawn mauer or new parking lot was greatly scrutinized as well as do we need a new boat. no, we are not done figuring it out. >> the improvements helped, but there was no way the company could have survived last season and eased into this one without their staff. >> if you think you can grind your cast members to a pulp throughout the summer, that's the wrong way of running a business. they are just as important as i am. we couldn't do what we are doing without them. >> there's plenty of work to be done. staying on top of customer feedback and what's working and

what's not. >> some tell of their experience, some don't. those that don't scare me the most. we don't know what they are thinking. >> they needed to hit the reset button. they made a promise to themselves. they refuse to let their customers down again. >> we did get slapped in the face. we needed it. what used to be busy is now a normal day. what is busy is now you are just trying to keep everyone in between the white lines. there's always curveballs. >> don't fight it. kind of roll with it. if you don't have that mind set going into every year, yes, we are going do this and yes, it's great. it's going to be a great season, you are doing the wrong thing. it is, it's important for us all to be ready for whatever is to come. >> if a stranger came at you with a gun and stole money from your business, you would be angry, to say the least. you would call the cops and try to figure out how to deal with the loss. for many small business owners,

theft is not that unusual. not calling authorities is a recipe for catastrophe. we want to know what to do to protect yourself. we went to atlanta to find the answers. >> if you steal $250,000 from me, you are going to jail. >> a business adviser who can't stand to see entrepreneurs getting ripped off. >> i feel sick to my stomach to be frank. >> she says she's been through this so often, she can spot a fraud before the business owner noticed. >> i can walk into a business and smell it. they know something is wrong. as a general rule, they don't necessarily know what it is. somebody needs to figure out it. >> our accounting was having difficulties or things weren't matching up.

>> a second generation owner at spencer heating and air-conditioning. he was so focused on clients, he never worried about small glitches with his trusted bookkeeper, mary ann. >> she was the grandmother of the company, watch after the guys, make sure they were eating healthy. the perfect bookkeeper. she looked after things as if they were her own and took responsibility for all the finances. >> if there's an excuse you can't get the financial statements on time. for somebody who knows what they are doing, that should be a warning sign that goes, excuse me, what's going on here? dig into it. >> it wasn't until the company switched to online banking that he started examining the bank statements. we knew the signatures were not mine. she had no check writing privileges, but she was signing my checks. so, there was no doubt what was happening. >> first thing we are going to do is create a report.

>> detective fran foster of the duluth police department sees it all the time. >> it's common and i have prosecutored a number of cases. >> they face painful decisions after they confronted the thief. >> she fell on the floor on her hands and knees and begs us not to prosecute. >> i'll pay you back. i'll make it right. please don't call the police and ruin my life. i have kids. i have a husband. i have a family. >> detective foster doesn't buy what she calls sob stories. >> in every case i have worked, every single one, there is a back story to the theft. usually, it started from another employer who didn't call law enforcement. >> we learned after this, she had done this inni new york and stolen from a company and they said they would not prosecute if she paid them back. she paid them back, came here

and it happened again. >> he fired her immediately, then he called the cops. >> she had written $180,000 worth of checks to herself, to friends, to family and other places. >> are you afraid that any of your employees will steal this? >> nobody wants pipe. >> 95% of people in a blind survey admitted to stealing from employers. >> she's written a warning to business owners, citing a stack of cases like this, the ugly truth about cash. >> we fixed the problem. we fix what's going on and all of a sudden, they have cash again. >> there's no foolproof way to do it, but if you set up checks and balances, it is a more difficult target. first rule, only you should sign checks. >> giving a bookkeeper authority is insane. >> if their name is on your checking account, they have

access. they have your permission to write checks. >> rule two, have the company bank statement sent directly to your home or computer. don't let anyone intercept it before you read it. >> why send the statement home? reality is this, a lot of times there's automatic payments to somebody you don't know. more often than that, that's to the embezzler's checking account. if you write a check for $100 and $1,000 is taken out, a warning sign goes off. bank could have made a mistake, not likely. >> keep track of monthly financials. >> if it's not balancing, someone is playing games. two, look at p & ls. if you see negatives, why? go to the bookkeeper and ask. your job is oversight. if you can spend 15-30 minutes a month, that's all you have to do

as owner. >> let everyone know you are watching. >> if it doesn't look right, circle it, give it to the bookkeeper, give me the back up for this. >> while it's important to trust your staff, verify. >> there's been many embezzlers i have found afterwards who work for a company and find they can't steal from them, so they go to the next company. that's where the theft happens. >> if this sounds harsh, ruth might say, you need to be harsh. i am here in chicago at the internet retail exhibition. so much is changing in the retail industry. we decided to come here where the experpts are getting together to find out what is coming new. i have dara meeks, vice president of the group. thanks for stopping by. >> thank you. thank you for having me. >> we are going to talk about payments. i remember the first time i used my phone to pay for something.

it was amazing, right? or the first time i went to the apple store and they brought an ipad and i paid sitting in my seat. this is just the beginning? >> just the beginning. so much is happening out there. the world is changing so quickly. feels like an endless future for us. mobility is one part of that. as we roll as an industry, i think it's in retail and every part of what you do. >> as a retailer, small, medium size, growing to be a large retailer, do i need to be forward thinking about this or can i just follow the big guys and that actually will work better for me? >> you know, i think it's a combination. it's what you have as internal support to take the initiatives, personally. forward thinking is the way to go. you are going to expand your customer base. >> for instance, facial recognition is something that is coming. >> right. >> i'm on my phone buying something. i don't have to pull my credit

card or anything. papal. look at it and it is paid for? >> it's a new thing. it's taken action overseas in china where they have industries that support this. it's going to keep carrying over into the u.s. and other countries. it's customization. >> will this just be something that i use almost like how retailers use papal now? is this just a third party software, something that i use, put on to my site or in my store so i don't have to do that much myself, i just incorporate it? >> correct. there's applications people are going to do trials with. they will figure out where to put it on, like apple phone or google phone, samsung phone? once they get it down pat and figure out who is using it and what for, it is going to be explosive. >> facial recognition is one.

>> all kind of things, fingerprint is the biggest thing. safest and most secure. there's other payment industries that are coming out. bitcoin is unsure, but with new progress, you might see other transitions. the question is, does paper go away? these are things that are factoring in. or is there a different kind fitting in there? >> over the holiday, i saw a chart of stores experiencing bitcoin. with ico's, other kinds of currency out there as well. >> it's incredible, bitcoin with the wallet selection, people are more secure about it. the phase of the initial square is over and people are trying to embrace it. it's the next new thing. anything where they are doing a simple, fast and secure is the way of the future. >> how do you parse this out as a business owner and figure out what to be following and offering? >> sure, it's tough.

you have to look at who you are trying to target. what is your customer base? what are your goals for the future? brick and mortar or online? with the target base, what is going to appeal to them to come back to you? as you do that, you will find the right solutions. go out, do your research, find out who you want to do partnerships with. simple with the operations and move forward. >> how quickly is this going to change? >> rapid. it's every day. i look at partnerships i read about in the news. i talk to people going out and doing experiments. the world is changing. >> do you think i'm going to pay for most things with my face? >> very possible. people change and have that desire, the companies will change along with it. yes, i think things within the next year to two will be facial recognition, mobile, 90% of it. one application that helped us early on is clerky.

you can use templates to provide legal advice early on. spotted places use it as a way to incorporate. it was hassel free and allowed us to do it in half the time. >> one thing that helped me is the work. he's interviewed different founders and sass businesses. it's about metrics and could be about business planning. it's different than other companies in a consumer base. that helped. >> i love to use sero for bookkeeping needs. they are cheap, 30 bucks a month. they spent two hours helping me set up my account. so much easier than quick books.

>> start up has been great. it allows us to put our plan online, reach out to investors and allow them to see us and tell us how they are doing. if they are interested in investing in the company, reach out. it's great to have everything consolidated. it helps when they say, can i see your pitch deck and all they have is a mobile phone. sometimes you don't have a computer with you and everybody has their iphone with them. it helps a lot with that. i'm here with this week's elevator pitcher, trevor, who is here to tell our panelist about a great service called -- >> free your arm. >> free your arm. you have props with you. i'm going to let dwrou the pitch in there. how old is the company? >> a little over 3 years old. >> have you raised money, yet? >> no. boot strapping. >> are you used to doing pitches to investors or partners?

>> this is my first. >> got it. how do you feel? >> feel good. >> you have been practicing? >> yes. my mentor made sure i was practicing. >> let's roll your suitcase in. you are pitching to two one is ceo and founder of the wellness company mind, body. an incredible success story. the other one, kenny dictor, ceo of a private aviation company. let's go and introduce you to them and see how you do. >> hi. my name is trevor, the founder of free your arms, we're new york's original mobile luggage storage. i want to share with you how we give hotels a competitive edge. as travelers, we all have a common problem. sometimes we arrive way before our check-in. so we waste valuable time stowing our bags as opposed to going directly to the theater, museum, sight-seeing, business

meeting, you name it. free your arms solves this problem. we meet the traveler at the airport, at the train station, anywhere in the city, we pick up their bags and deliver it directly to the hotel. now, we have been in existence for a little bit over three years, our prices are very reasonable, $19.99 per bag and great reviews. what is there not to love? so why don't i show you how you can take a load off of your shoulders, off your schedule, and out of your arms. >> i like this. i like this. >> time is money. >> that's right. time is money. >> nice job, trevor. good job. okay. i'm going to give you two this board. i need from 1 to 10, the first what do you think of the pitch -- sorry, what do you think of the product, the service in this case, and the second, what do you think of the pitch, 1 through 10. >> i'm ready. >> go ahead. >> i give an 8 on the product. i think it is an innovative idea. you're attacking a problem that

is real. it looks like you've proven yourself, you've done it, demonstrated it. defending that might be a challenge because there is other services that might be able to disrupt it. the pitch, pretty good pitch. i think you can work on it a little more, give more examples of how a business traveler, for example, might use it in addition to somebody who is on vacation. >> yeah. all right, ken? >> my big reveal. product, 9, we're in a gig economy. so, you know, people making lives easier, you look at uber, air bnb, getting outside the traditional world, i think with uber, you can't leave your bags with, like, a car service. you have to put them somewhere if you want to go out and about your day and time is money. so -- >> you deal with travelers all day long. >> all the time. we sell convenience, so i can relate to the idea of freeing your arms, but more important freeing your mind. the pitch is an 8. i think that if i was giving advice on the pitch, i would

just be very relaxed, this is in your body, in your bones, you're doing this, you love, the passion needs to come through, a little less rehearse and a little more from the heart. that's going to resonate with entrepreneurs or anybody you're looking to do funding with you. >> thank you. you both are, you know -- >> my bags are downstairs if you want to move them. >> $19.99. we appreciate you coming and giving your advice. it is helpful, thank you. when we come back, we talk about patience, why you need to take your time before releasing a new product and why you have to pace yourself when scaling your business. it's pretty amazing out there. the world is full of more possibilities than ever before. and american express has your back every step of the way- whether it's the comfort of knowing

help is just a call away with global assist. or getting financing to fund your business. no one has your back like american express. so where ever you go. we're right there with you. the powerful backing of american express. don't do business without it. don't live life without it. we have this e-mail from rajiv who rowrote, how do you dl with the art of patience when scaling a business. >> that's a great question. i still don't think i have any. i can say over the years from my first entrepreneur to now, what i've learned is when i didn't have a long-term plan, i didn't have any patience. i wanted everything right away. the longer term your plan is, the more you know where you want to go, the easier it is to take a breath and allow time for things to come together. so patience for me has grown

over time, based on the longer term planning cycle. and as i've scaled my business. but, by the way, i'm still impatient every day. we now have the top two tips you need to know to help you grow your business. rick and kenny are back with us once again. you've given us some good advice. both of you guys started companies from nothing that blew up basically. mind body is how big now? >> $250 million in revenue this year. >> that's crazy. it is the back end for basically every gym i go to. >> about 68,000 businesses running on it. >> insane. you started from nothing. >> yes. >> tell me something everyone should follow, something you learned along the way. >> i advise a number of entrepreneurs and sometimes you'll see a entrepreneur get ahead of themselves, thinking about marketing strategies and they haven't yet proven a product market fit. number one thing you have to do is actually prove that you built a product or service that somebody wants and, like trevor, gave us that pitch, the most

important part is he's actually been operating, actually has proven he has customers. >> i don't think this is just for entrepreneurs. if you have an ongoing business and launching something new, it is so easy to sit in a room and be like, i know our customers are going to love this, remember, get back in the early entrepreneurial startup mind set and say does anyone want this. >> you find that perfect fit, you keep innovating. but, again, you sometimes -- entrepreneurs thought through the whole structure of the company and how they leverage social media and market it and they don't have any customers yet. that stuff will come and the infrastructure will come. you got to get the product market fit and that's hard. >> also, you sold to berkshire hathaway and started another company, same space-ish. amazing track record. >> wheels up, trying to be more netflix to net jets, more of a subscription model, five years in, really excited, i would say

we're proof that anything is possible in america. >> well, good, yeah, that's good to remind ourselves, especially in these days. so, tell me one thing you have learned. >> i learned that you can't be scared to pivot. no business plan, i know in your business, j.j., and the people you interview, the people that really hit it are the ones that can move. there is no straight-line in business. you got to pivot and i think if you don't pivot, you are just too hard core to your original plan, you're not going to get to the rainbow. the gold at the end of the rainbow. >> what was your scariest pivot? >> i wouldn't say any of them are scary. it is more scary not to pivot. but i think in our space, you know, we were focused on the 25 to 50 hour flyer at wheels up. i think the real magic in the space is the zero to 15 hour flyer which is the eninteretry flyer. that piece of space is much bigger. >> congratulations to your success and many times over. good to see you both.

>> j.j., if you get stuck anywhere, call us. >> believe me, you're the first call i make. we are going old school with this week's your biz selfie from t.j. and brandy who own and run the asheville pinball museum in asheville, north carolina. i heard about this and wanted to go visit it. it is a mecca for players who want to experience the classic game. now why don't you pick up your cell phone, take a selfie of you and your business and send it to yourbusiness@msnbc.com or tweet it to msnbc yourbiz. thank you so much for joining us today. we love hearing from you. so if you have any questions or comments or just want to say hi, send an e-mail to yourbusiness@msnbc.com. also, please click on our website, it is msnbc.com/yourbusiness. we put up everything from today's show, plus a whole lot

more for you. and don't forget to connect with us on all of our digital and social media platforms as well. one last thing, check out the podcast, been there, built that, it has been so much fun to do and i have gotten to have so many interesting conversations with really successful founders and ceos. you can download it for free from tune in or wherever you get your podcasts. we look forward to seeing you next time. until then, i'm j.j. ramberg, remember, we make your business our business. the line between work and life hasn't just blurred. it's gone. that's why you need someone behind you. not just a card. an entire support system. whether visiting the airport lounge to catch up on what's really important. or even using those hard-earned points to squeeze in a little family time.

no one has your back like american express. so no matter where you're going... we're right there with you. the powerful backing of american express. don't do business without it. don't live life without it. welcome to "politicsnation." i'm in virginia this morning, where a state of emergency has been declared ahead of potential unrest. on the one year anniversary of the white nationalist rally, that led to the killing of heather heyer, in a few hours i will be speaking in charlottesville at the mount zion first african baptist church. more on that anniversary in a moment. later on in the