-lemonis: and be open-minded. -giovanni: you've got it. lemonis: richard, i'm marcus lemonis.: hey, scott. lemonis: scott, nice to meet you. -scott: hi. -lemonis: this is lisa. -we'd love to get a tour. -giovanni: yeah. scott: we need to get you guys suited up. giovanni: holy [bleep] ♪ lemonis: what we saw when we walked into that place is the most professional, state-of-the-art food-manufacturing facility that i had ever seen in my life. giovanni: wow. scott: this is our q.a. lab. lemonis: so, this is chicken, beef, salmon, and egg. scott: all basically no byproducts, no corn, wheat, soy. lemonis: we saw their attention to detail, and we saw the great pride they have in making sure that pets stay healthy. i could tell this is having a real impact on lisa. man: check it out. lisa: it's awesome to see it in action and how it goes from this to the actual product. it's very impressive. lemonis: what i hope lisa learned from this trip is in order to grow your business, you have to be open-minded and learn and do research. freshpet is an opportunity for them to grow their business.

lemonis: my name is marcus lemonis.eth and i made a deal for me to put $75,000 into this business, and i'll own 25% of the business. you can expect the entire process in here to change dramatically. how many of you have seen the recipe book and studied on it and been trained on it? you been trained on the recipe book? that's because there is no recipe book. we're gonna upgrade and improve the process and the equipment so that the same amount of people can make enough pie to not run out at 2:00. on a scale of 1-10 -- "10" being laser-focused, "1" being all over the place, describe her. 1-10. shay: all over the place. lemonis: so that's a 1. -shay: i would say a 3. lemonis: a 3. man: i think 3 sounds pretty accurate. -lemonis: 3? -man #2: 3. -lemonis: 3? -woman: 3. -lemonis: 3? -man #3: 3. lemonis: betty's struggling to manage this place, let alone her second place, which has been a drain on her time and her money. so for now, i want her to focus on this location and this location only. while you guys have done a good job

-lemonis: okay. lady: i never understood that market. we had mill valley, california. lemonis: [ laughing ] and why didn't it work? please, don't say because you didn't know the market. lady: that is what happened there. lemonis: jeans isn't barbecue. it's not that complicated. whether this is cleveland or the most fascinating city in america, it's jeans. really. so three stores left today. lady: yes -- san francisco, chicago, then dallas. lemonis: what was the worst year? lady: i believe 2013. and we did like $8 million on the top line, -but we had losses. -lemonis: how much was that? lady: $396,000. lemonis: and that was with 13 stores? lady: that was with the whole engine running. lemonis: ah. in 2013, lady did $8 million in sales across 13 stores but lost close to $400,000. that's because only three of the stores were actually making money. and the big problem was they weren't making enough money to keep the other 10 open. and so the only solution was to keep those three and say goodbye to the re

lemonis: okay. franchising is an incredibly attractive business model because it allows you to get paid once you perfect a concept. my big fat greek gyro only gets about $10,000 when they sign up a new franchise. in success, that fee could grow much higher. better still, each of your franchisees pay the owner a royalty on a monthly basis. that could be anywhere between 4% and 12% of your monthly sales. mike: right now we're making about $60,000, $65,000 annually on royalties. lemonis: they pay an up-front fee. mike: correct. lemonis: you control the branding. mike: correct. lemonis: who picks the locations? who goes out and vets it 'cause it's your brand? mike: i do. lemonis: who developed the menu? kathleen: we did. lemonis: i was gonna take a trip to greece this summer, and i'm looking for tater tots... cheese sticks, cheddar balls, mushrooms. -hummus isn't greek. -andreas: lebanese. lemonis: what do you actually make yourself? mike: we have the traditional gyro. we have steak. we have fresh chick

to-lemonis: wow!profit"... this thing's beautiful. ...two english gazebo makers are chasing their american dream. you guys build these from scratch? damion: everything. we design it, we manufacture it, and we install it. lemonis: but while their product is a thing of beauty, the business is anything but. damion: patronize me like that. -that's what you do. -simon: i'm not patronizing you. damion: little things like that -- that's what pisses me off. lemonis: their process is amateurish. damion: we have to drive a mile down the road to use the restroom. lemonis: their marketing is misguided. how do you acquire your customers? damion: 99% of our business comes from these fairs. lemonis: and their relationship is at a breaking point. damion: you're making it out that you just sat back... simon: i'm not making it out at all. he asked me, so i told him. damion: ...drinking a whiskey, smoking a cigar. lemonis: if i can't help them get their house in order, this company will fall to pieces. damion: it's so hard for me

-lemonis: why? -layne: she actually just got so aggressive on buying a bunch of inventory 'cause she was so excited about the product that she created. she just wanted to sell a ton of it. and me, i was wanting to try a little bit of it and then let's see if it sells. she's kind of like that helium balloon. if you don't grab her, she's just gonna keep soaring away. -[ laughs ] -miranda: it's true. this is our production room here. hey, ashley, can you show marcus how you fill lip glosses? she's way better than i am now. lemonis: i think the thing that surprised me the most was their manufacturing process, if you want to call it that, where they basically line up trays of empty bottles, and, with a syringe, they essentially fill them one at a time. i did one. -[ laughter ] -it's terrible. ashley: you did a good job. lemonis: that's, actually -- honestly, that's not easy. -ashley: no, it's not. -lemonis: you do it with this? -ashley: every single one. -lemonis: in big vats. i mean, i guess it's workin

lemonis: my name is marcus lemonis, and i fix failing businesses. if you don't like money, don't follow my process. i make the tough decisions. we're closing the store, we're done, i'm not talking about it anymore. i back them up, spending my own money. it's not always pretty... man: perfect flavor. lemonis: ...but this is business. you got to trust the process. i do it to save jobs, and i do it to make money. thanks for your business. this is "the profit." fairfield, connecticut, is a pretty new england town right on the coast of the long island sound, and swansons fish market is one of fairfield's local institutions. for over 40 years, they've been selling fresh fish, hot soups, and doing a little catering and, along the way, got their fair share of critical acclaim. gary: okay, you're getting the works today. lemonis: gary swanson jr. took the market over from his dad and worked alongside his wife, sue, and they made a comfortable life for his family. but on july 4, 2009, a fire destroyed his original store. [ siren wails ] dispatcher: code 6. ga

-lemonis: well... while i appreciate keith recognizing his brother's experience, i'm not quite sure that 50/50 is exactly the right formula. if i asked most of the employees here who is in charge, what would they say? matt? -your name is matt, right? -matt: yes, sir. lemonis: who's in charge between the two of them? if the building is burning down, who do you go ask? matt: i call 911. [ laughter ] lemonis: when you have a situation where there's 50/50 partners, you also have 50/50 leaders with no one clearly in charge. what is the total revenue of the business? keith: last year, our revenues were down a little bit. -we did three and a half. -lemonis: $3.5 million? keith: yeah, just over $3.5 million. the two years prior to that, we were $4.3 million and $4.4 million, respectively. lemonis: so, business is down. keith: one of my bigger customers, they slowed down for a couple months. -lemonis: what's the name? -keith: weis markets. lemonis: weis markets? okay. of the $3.5 million, how much do they do a

lemonis: okay. erik: well, basically, what you do is you go online. you would select from a program, whatever you'd like. these are the programs. and we deliver gourmet health food right to your door. lemonis: fuel foods offers various meal plans. if you buy 10 meals, the cost is $9.50 a meal. but if you pre-pay for 300 meals, it drops to $7.50 a meal. now, that's a big discount. but incentives like that help cash flow, and they build brand loyalty. erik: so, we don't have any real production going on today. we have packing going on today. we're packing for tomorrow's orders. they'll arrive tomorrow to the clients. lemonis: so, today's thursday. what days do you cook? erik: i'll show you here. lemonis: what do these different colors represent? -erik: it's a packing day. -lemonis: okay. erik: so, we're packing on this day for delivery tomorrow. -lemonis: okay. -erik: same deal here. they're packing here for delivery on friday. lemonis: and when is the food prepared? erik: the menu changes twice a wee

lemonis: okay. at the moment, we're close to $1 million. lemonis: so you'll do 35 this year, roughly? -damion: yeah. -lemonis: $1 million in sales. damion: yeah. lemonis: with 45% gross margins. and, then, what are the operating expenses? damion: about $200,000. lemonis: so you're gonna make $250,000, which is a 25% net margin. that's pretty good. do you owe anything to any of your suppliers? damion: no. lemonis: so it sounds like you guys are doing pretty good. how much cash in the business right now? damion: $100,000. i'm a firm believer of keeping as much money in the business as possible. we took very minimal money for the first year. lemonis: how about now? what are you making? damion: $4,000 at the moment. i have a wife. i have two babies. and there's another mouth to feed coming. simon: i have a pregnant girlfriend back in england. lemonis: how many employees total? damion: so, there's myself and simon, and then we have four guys in the workshop. you'll meet jack, and he's an amazing guy, and

lemonis: okay.we had a handshake, and we had agreed to the terms of the deal, and i had spent time and money. but they were no longer interested in honoring our deal. pete: i can tell you right now, we are not gonna iron out those deal points -- no way. lemonis: you're asking me to throw a million dollars in and be subjected to whatever fate you decide. "go stand in the corner, and shut the [bleep] up." that's essentially what you're telling me to do. steve: we don't like the fact that you can say no. lemonis: i don't see it working. steve: then, we can just [exhales sharply] if you want. lemonis: yeah. steve, honestly, you kind of [bleep] me all along the way. you just did. i walked away, and while i was out the $105,000 i spent, i managed to get the 3-d printer returned. people ask me all the time how it feels when people take my money or the deal falls apart. look, it stinks. i work hard for my money. and i didn't always have money. and so the money that i do have, i take very seriously. -hey! go

-lemonis: $7.rger with the freshest and finest ingredients. a $7 burger isn't gonna work. we want to average a 25% food cost. if the burger costs us $3.50 to make, then the retail price is gonna have to be around $12. we're gonna operate with the food cost as our basis, not our gut. what is the first thing that somebody will order? fuji: a burger. lemonis: and how are we presenting it? fuji: lettuce, tomato, and ketchup and cheese. that's gonna be the standard. lemonis: we know that, with the margins on fries, right, it probably costs us somewhere around 50 cents with packaging and everything. and we're gonna sell our fries for $5. think about the margins on that. today, 70% of their revenue comes from selling hamburgers. and so we want to drive the product mix to have hamburgers not be more than 50% of all the product that we sell. the other 50% of the products that we sell have to be products with margins of 80% and 85%, like fries, potatoes, ice cream. we're looking for everybody that we possibl

lemonis: my name is marcus lemonis, and i fix failing businesses.if you don't like money, don't follow my process. i make the tough decisions. we're closing the store, we're done,

lemonis: and the owners need to lose their self-righteous attitude.er, you have an obligation to deliver the consumer the choice to make that decision on their own and not for them. giovanni: oh, my gosh, that -- i'm -- lemonis: if these owners can't take control, their dream of creating a retail empire will go to the dogs.

to-lemonis: wow!profit"...s thing's beautiful. ...two english gazebo makers are chasing their american dream. you guys build these from scratch? damion: everything. we design it, we manufacture it, and we install it. lemonis: but while their product is a thing of beauty, the business is anything but. damion: patronize me like that. -that's what you do. -simon: i'm not patronizing you. damion: little things like that -- that's what pisses me off. lemonis: their process is amateurish. damion: we have to drive a mile down the road to use the restroom. lemonis: their marketing is misguided. how do you acquire your customers? damion: 99% of our business comes from these fairs. lemonis: and their relationship is at a breaking point. damion: you're making it out that you just sat back... simon: i'm not making it out at all. he asked me, so i told him. damion: ...drinking a whiskey, smoking a cigar. lemonis: if i can't help them get their house in order, this company will fall to pieces. damion: it's so hard for me

lemonis: the owner is clinging to a questionable sales strategy.n up a lot of space with a dead shoe bar that could have been a cashmere corner. and her mother's legacy is on the line. lady: to lose her money would be doing her a disservice. lemonis: there's no supervision at the top, and roles are confused. tasha: if i had more direction, i could have done better. lemonis: i need to sort out the staffing problems, get rid of stagnant merchandise, and give this retail chain a brand-new identity. lady: oh, my god. lemonis: or the blues jean bar will be a wash out. lady: i'm consumed by fixing this problem.

-lemonis: oh, my gosh. ...a progress report. this place looks great.e past 18 months, i've traveled the country, trying to help small businesses, everything from pie shops to used-car lots... wow. look at this place. ...to clothing stores. some were in desperate situations. michael: [ voice breaking ] do you think i like to stand next to a man like you and admit that i can't be successful? [ sighs ] lemonis: others just needed some guidance. come on. you're a smart guy. you do the math. and i offered my money and my expertise for a stake in the business. -do we have a deal? -hank: deal. -pete: yes. -alan: yes. lemonis: a few of the deals went south. you don't how to treat people.

lemonis: over the past two years, i've introduced you to 30 small businesses.'m 100% in charge of everything. i didn't make deals with everyone. you're a thief and a liar and a cheater. but today, i have 17 new partners. -do we have a deal? -jon: i'm in. lemonis: i've already invested over $30 million. nicolas: i've never seen a check that big before. lemonis: but the work doesn't stop when the cameras are gone. and success is never a guarantee. nicolas: i'm having a tough time. lemonis: tonight, we head back to new york city to a company that buys used cars.

>> my name is marcus lemonis, and i fix failing businesses. i make tough decisions... i will not do it if you're managing the people. and back them up with my own cash. it's not always pretty... first time you ever emptied out poop? but this is business. i do it to save jobs, and i do it to make money. this is the profit. la dogworks is an upscale dog boarding facility located in the heart of hollywood, california. >> you're stinky dogs. >> founded by andrew rosenthal in 2004, this 24-hour full service center with 36 employees has everything from grooming to training... >> sit. >> in a state-of-the-art indoor dog park. this business generates $1.3 million a year, but recently, their numbers have started to tumble. sloppy business practices... >> i don't want to waste your time, and please don't waste mine. >> together with lax management... >> there's inventory missing? >> well, you know, it's hard to tell, because stuff slips through the cracks. >> has driven down sales and piled up $150,000 of debt. >> you know, i could lose everything. >> if they don't make changes,

my name is marcus lemonis, and i fix failing businesses.f you think that i can launch you in a direction to make you a profit, then you should do a deal with me. i make tough decisions...

>> yes. >> so am i, lemonis. >> oh. >> it's two greek-- >> so, see, you know how the greeks are, then. >> that's right. i do know how the greeks are. listen, one of the things that i think may be a better angle is for us just to buy the bank's position. so if we just signed a deal to buy the bank's position at $240,000, the economics are the same for you, but they put us in a little better spot, and i want the leverage to have the ability to get something back. when the original borrower took out a loan against the warehouse, he pledged additional pieces of property other than the warehouse as part of the loan. the loan is now in default, and the bank is foreclosing, so when i buy the bank note, i'm not only gonna get the warehouse as collateral, but i'm going to get other pieces of property as collateral as well. my plan is to liquidate those other pieces of property, which will lower my investment from $240,000 to $140,000. >> you are 100% correct. >> do you understand? >> you should. you should! >> to me, the

[laughing] "i'm marcus lemonis."ughter] >> that's gonna cost you. >> [laughs] >> so here's the deal. my offer is, uh... i'll pay off the 1.1 million of debt and i'll provide another million dollars in a working capital line, and i want 50% of the business. >> no. >> that's not gonna happen. >> why not? >> 'cause we're not gonna give you controlling interest of our company. >> why is that? >> because-- >> it's part of who we are. >> skullduggery is me. i am skullduggery. it's my company. it's our company, you know? it's not your company. you didn't spend 25 years building this company. >> so 1.6 million in revenue, you've got no cash in the bank, and you lose money. and you think giving up half of the business is a bad deal? >> you're asking for our whole life. you're asking for everything that i've ever worked for. >> yeah, i mean, it feels like a punch in the gut. >> i just offered to wipe out a million dollars' worth of debt and then give you another million dollars in working capital, and you're acting insulted ab