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CinemaJourney
  • 2 days ago
#CinemaJourney
#The Fixer

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00:00Across America, thousands of businesses grinding it out every single day because the ultimate
00:09American dream is owning something you built. Everything will be stationary for when Marcus
00:15comes in. Every episode, I'm meeting businesses at a crossroads. We've actually invested our
00:21entire life savings into this business. I'll pick one and go to work, but I'm not a consultant.
00:27I don't believe in handouts. I'm a capitalist. This is $15,000. Always looking for ways to
00:34make money. That's why we want you to work with us, because we're bad at math. That's a
00:38terrible reason. You should be good at math. I'll work on their people. I don't know why
00:43you're being such a dick about it. Leon, are you mad about something? No. Why the f***
00:47are you singling me out? Their process, the execution, is just like, what is it? In their
00:54product. We've heard from the clients that it's not so easy. That's f***. Marcus is an
00:58amazing investor, and hopefully we'll invest in our business. In the end, we'll negotiate.
01:03My offer is $500,000 for 10% to see if a deal can be made so we both can profit.
01:09Welcome to the island. How are you? Hi. I'm Marcus. I'm Colin. Nice to meet you. Nice to meet you. I'm Shelly. Nice to meet you. Nice to meet you. I love it.
01:31So we are a husband and wife team operating out of Brooklyn. We're a frozen dessert business. We sell
01:39ice pops, sorbets, and ice cream. Growing up in the Caribbean, ice cream is traditionally presented. You
01:43know, you have a passion fruit ice cream, you have a sauce of ice cream, you have a rum raisin. We're here
01:47to kind of push those boundaries, so we turn any dessert into an ice cream or a sorbet or a popsicle.
01:53You have one shop? Yes. And how does that do? That does well. In 23, we did a 475, and we turned
02:01a 70,000 profit. In 24, we did 360, and we did a 3,000 profit, but we moved. So the bulk of the
02:07difference between one year and the next is simply because you had to close down and start up. Can I
02:14taste what you have? Of course, definitely. Wow, look at this. Maybe start with the sour sauce because it'll
02:21be lightest on your palate. Yes. It tastes like a tart vanilla. Yes. It's got a really beautiful
02:27smoothness. It's not too sweet, not too tart. Try the guava cheesecake. That's delicious. It's the
02:33number one summer flavor for us. Yep. What is this one? This is the rum and raisin. Rum and raisin. Which I love.
02:37It's actually my favorite flavor. We soak the raisins in rum for three to four months. That is
02:42outstanding. Thank you. Where you been all my life? What do you need help with? We need help scaling. We want to
02:51be in other states. We also need capital to make that happen. You have a unique product. In my brain,
02:57I'm having a slight problem, though. Okay. I can't get my head away from warm climates. Yes. So when I
03:03think about you being here in New York, you're swimming upstream constantly. I have an ownership
03:09stake in a key lime pie business in Key West, and there's a young lady that owns it now, and she's got a
03:16big space. I'd like to connect you with the team in Key West. Okay. I'd like to put up $15,000 to test
03:23some data to explore. If we were in a warmer climate, what is the opportunity? Does that work? So awesome.
03:30Thank you so much. Thank you so much. Well, hello. I'm Marcus. So nice to meet you. Elizabeth.
03:38Elizabeth, nice to meet you. I'm Marcus Lilia. So nice to meet you. Nice to meet you. Hey, Marcus.
03:43Nice to meet you. What is your name? Marlon. Nice to meet you. White Lotus Home is an organic bedding
03:49company. We make it all using nothing but natural and organic products, and we hand make it right in
03:55New Jersey. What are some of the things that are amazing about the company? The revenue?
04:01So we got up to $1.1 million two years ago. Okay. At the end of 2024, we went up to $1.7 million.
04:08Break down the $1.7 million for me. So it's only $600,000 private label, $200,000 wholesale,
04:14and the rest is retail, which will be $900,000. $900,000 will be retail. $900,000 will be retail.
04:20Half of $1.7 million is how much? $850 million. Okay. So if that's the middle ground,
04:25which part of the business generated more than $850,000? None. So you just said retail was $900,000?
04:36Yeah. I know I put you on the spot. I apologize, but not really. You don't really know the math
04:42of your business. I disagree, but okay. But I want you to prove it to me then.
04:47If you look behind you, that's why we love you. That's what we have. We have that for every single
04:51shoe. Breaks everything down for you to the T. How much yard we pull from the roll? So one
04:56minute and a half, and then we can make five out of those, right? This is the course of fabric just
05:01for that one pillow right now. This is for all five of them or for one? No, no. This is for one.
05:07Sorry. This is for all five. No, that's the price per yard of the fabric. Sorry. Thank you. Thank you.
05:11Here's the thing. I'm intrigued by $1.7 million. What I'm still cautious about is that business is
05:20about the specifics. And if you don't know the numbers, you don't know your business. Of course.
05:27I don't see an opportunity today, but I smell one or I see one in the distance. But I need more
05:34refinement. Yes. Look, they've put up this giant spreadsheet on the screen, and it's impressive
05:39to look at. But if they don't understand the numbers that make up the sheet, I don't know what
05:44we're doing here. Okay, my man. Thank you so much. Thank you. Thank you for taking the time.
05:52Look at the doggie. Hi, guys. Hi. How are you? Oh, my gosh. How are you?
05:56Oh. He likes people. Well, I like doggies. I do. I'm Marcus. Kimberly. Kimberly, nice to meet you.
06:03And who is this? This is Ezra. Ezra? Liz. Liz, how are you? Very cool hair. Thank you very much.
06:10Hi, Stephen. Stephen, how are you? Nice to meet you. We are a new experience in the pet space. We provide
06:16grooming, but in a very different way. We focus on stress-free environments and transparency,
06:24where we have individual suites that are made of glass so that mom and dad can see through. And we do
06:30not kennel and we do not cage. And what is your role in the business? I am the director of grooming
06:35and education. Oh. So I've been in the industry for over 30 years. I'm called an NCMG, which is a
06:41nationally certified master groomer. We are in the process of building a school. I've transitioned
06:46into that role of educating. Can you show me how it works? Oh, yeah. What'd the whole build out of
06:52your whole place cost? A little over a million. Okay. How much does it cost? Like, if this was my
06:57doggie, how much would it cost? So he would still be like 180 at his weight range. To 210. That's a lot
07:03more than I used to pay. I think our base price on our most expensive is 290. What are you doing? Are you
07:09rubbing my feet? What's happening there? Kimberly, her gold Rolex watch was big and her diamond earrings
07:15were shiny. She's premium. And I'm wondering if she created something that was so elevated
07:20that she's trying to figure out how to generate revenue. Are you not profitable today? Why'd you
07:29have to think about it? You're like, you're looking up at this guy hoping to... Well, because I'm trying
07:32to think... Am I profitable? No, not profitable yet. Okay. I'm not even to my burn yet. I'm still
07:38self-funding. How much money have you put in?
07:44A little over three. Three what? A million.
07:52How much money have you put in? A little over three. Three what? A million.
08:01It cost you a million dollars to build it out, and then the other two million went where?
08:06Operating. I mean... So you've lost a million dollars a year of your own money?
08:11Mm-hmm. That's... I'm shocked. Yeah, that's a lot of money.
08:14You're learning that for the first time right now? Yeah.
08:17How much longer can you survive if the business keeps losing money?
08:20Maybe another six months.
08:24You've got amazing people. Mm-hmm.
08:26You have a great, at least an execution process, and you're dealing with a great product. And for me,
08:32when I see those three things, there's a chance to make a profit. So I'm going to come see you in L.A.
08:38Good economy, bad economy. People will have pets, and people will spend money on their pets before
08:43they'll spend money on themselves. It's really only because of you.
08:47I've arrived in North Hollywood at the fluffology business, and I'm about to meet with Kimberly,
08:56the owner. And I want to understand where this disconnect is between her price points and why
09:02she's not seeing consumers. And as I look around the neighborhood, I'm starting to understand that
09:06there may be a mismatch.
09:11Hi. How are you guys? Good morning.
09:13I'm on the other side of the country.
09:15Good to see you. How are you doing? Nice to see you.
09:18Nice to see you, too. How are you? Good.
09:19I've been involved in the pet space for years, and I understand the opportunity here.
09:24But my primary motivation for coming here is the look on Liz and Stephen's face when Kimberly said
09:30that they had six months to survive. Anytime an employee feels insecure or unstable about where
09:37they work, that's not a good thing. That's what I'm here to fix. How are you doing?
09:43I'm well. How are you? Great to see you.
09:46Fluffology's concept is all about transparency, and I'd love that for the pets and the pet owners.
09:52But in order for me to understand how to help this business, I have to look at it from the
09:56perspective of the groomer. So I've asked Liz to actually give me a hands-on course.
10:01All right, I'm ready to be trained. Anything over 50 pounds is a team lift.
10:05One, two, three. Awesome.
10:10So our next step is we start the washing of the body. So you're going to take this middle
10:13knob. You're going to turn it to number one. Oh, this is like a car wash. Exactly.
10:18We've already pre-diluted the shampoos. We don't have mixing bottles, and you have to
10:22do a lot of stuff. We do everything ahead of time, so less movement around for the dogs.
10:26So it just helps calm them down. Once you're fully trained,
10:30you want to know how fast you should be at bathing a dog?
10:3210 minutes. On a dog his size at his length,
10:35it should take you about four minutes. I'll be honest, water's going everywhere.
10:39So I wish that the tub just ate up all that space, because every time...
10:43Well, most of them literally have a built-in backdrop.
10:45Yeah, like a tub at home. Exactly.
10:47Now just towel dry. Here's the thing. You don't rub hair. This is when it's the most
10:52fragile. Creates more matting. So you take the hair and you squeeze and let that towel do its job.
10:58Exactly.
11:02Welcome to dog grooming.
11:05We're going to put a happy hoodie on Finn, so it helps muffle the sound for him.
11:11What?
11:15This table can't hold him.
11:16Yes, I can. Really?
11:17Yes, I can.
11:19Here's a couple of things from my perspective. One, I thought the tub was a terrible setup.
11:25We had to hoist a giant dog up and into the tub. Water was going behind it. The table didn't work for
11:34me. It was too small for this size of dog. Kimberly, can you show me what you have going on in the back?
11:40This is the future home of the Fluffology Institute of Grooming.
11:46Fluffology is operating in a massively oversized space. There's six grooming booths that aren't all
11:52being utilized. And then there's the back of the building that's totally empty. And while that's a
11:57huge problem, I'm not sure it's as big of a problem as how bad this location is.
12:03How is the neighborhood?
12:05So the neighborhood, you know, is rich with history.
12:10Okay, I appreciate all that. How is the neighborhood?
12:12It's mixed. There's all sorts of different levels of income.
12:16A significant amount of homelessness as I walked.
12:19Sure, sure.
12:19And I didn't see the type of affluence that I thought I would see.
12:24I'm not sure this was the greatest location for us. We can't move at the moment. We are three years
12:31into a six-year lease. Now that I understand that Kimberly's stuck into a six-year lease
12:36in a neighborhood where the customers aren't going to pay $150 to $200 to have their dog groomed,
12:42it's clear to me that something dramatic's going to have to happen.
12:46Now I'm also seeing that the products on the shelf are equally tone-deaf to the local environment.
12:52How much inventory is in the retail store?
12:53We probably have about $176,000.
12:56And how much revenue does the store do?
13:00You don't want to say?
13:01$5,000 to $8,000 a month.
13:04Okay. What is your name, sir?
13:05Leo.
13:06Leo?
13:06Yes.
13:07Leo, how are you doing? That was my father's name.
13:09Nice to meet you, brother.
13:10Nice to meet you, sir.
13:11Can you hang with us here?
13:11Because I see you snickering a little.
13:14Leo, do you handle retail?
13:16Uh, operations.
13:18Okay.
13:18Yeah.
13:18What day's supply do you have?
13:21Uh, 4.65 years.
13:23You should be turning your inventory two to three times a year.
13:27When I hear that there's four and a half years of inventory, that's 1,642 days.
13:32That's a lot of inventory.
13:33What I really want is about 90 to 120 days.
13:36So I want to push that number down.
13:38But in order to do that, I need to change the price point and the offering.
13:43That's really the problem.
13:44Leo, did you order this?
13:46No.
13:47Okay.
13:48It's $175.
13:51This, is this a poop bag?
13:53This is more than the price of a handbag that a woman who lives in this neighborhood would spend.
14:03I'm just going to be more candid with you.
14:04This is offensive.
14:05It says to them, we are expensive.
14:09And what is wrong with that?
14:11You do have to rely on what's around you.
14:13Yeah.
14:14And if what's around you doesn't match what you offer.
14:17Yeah.
14:17That could explain the losses.
14:20We're going to need to create a retail assortment that actually speaks to a normal person's budget.
14:27Hey.
14:27Hi.
14:27How are you?
14:28I'm Marcus.
14:28Hey, Marcus.
14:29Rick.
14:29Rick, nice to meet you.
14:30Nice to meet you.
14:31How long have you guys been married?
14:32Uh, 18 years.
14:34Uh-huh.
14:3518 years.
14:36Now that I'm hearing about and meeting Rick, her husband, for the first time,
14:40I think it's important that we all sit down to understand how in the heck did they spend $3 million?
14:49I can't go anywhere without it.
14:51Oh, my gosh.
14:52Does that fit in your pocket?
14:53What is the total for the year last year?
14:57$375,000.
14:59Okay.
15:00What was the best month of last year?
15:02$47,000.
15:03$47,000.
15:03$47,000.
15:04And what was the worst month of last year?
15:07$19,500.
15:08Okay.
15:09How much business did you do last month?
15:11$45,000.
15:12I think that's a good trend.
15:14It is.
15:14Now tell me where the revenue's coming from.
15:17Grooming, for sure.
15:19What's becoming more clear to me is that while the revenue is up,
15:22it clearly isn't generating enough to cover their expenses.
15:26But the bigger problem is the lack of diversity around their revenue source.
15:31The $3 million that came into this business came from where?
15:36Most of our wealth we accumulated while we were married.
15:38We had a very good run in business.
15:40Yep.
15:41She helped me expand my business at a time that I really needed help.
15:46So if I could help support her by being kind of really an investor
15:50during her startup of a business that she's passionate about,
15:53that would certainly seem to be the right thing for me to do.
15:56When is the next time you think you're going to have to put money in?
15:59Uh, probably at the end of the month.
16:02At the end of this month.
16:02And what is the projection for the rest of the year?
16:05Easily $22,000 a month.
16:07Shortfall.
16:08$22,000 a month?
16:09Yeah.
16:10Let me do the math for you.
16:11That's over a quarter of a million dollars a year.
16:15And they don't seem phased by it.
16:18Where most business owners in America would either be figuring out that they have to close,
16:22or figuring out very rapidly how to not close.
16:27I don't think I could do this.
16:29So where's your line in the sand?
16:31Uh, are you talking about time or finances?
16:34Money.
16:35Probably another million dollars.
16:38The fact that Rick is so flippant about like,
16:40yeah, I'll just put in another million dollars.
16:43While they just got through telling me that they're going to lose a quarter of a million dollars this year,
16:47that means he's planning on continuing this insanity for four more years.
16:52I hope they don't think it's going to be my million dollars.
16:56Because that is never happening.
16:58Allowing money to continue to be lost in the face of obvious things that you know aren't right,
17:05to me just feels negligent.
17:07And that's, I think for me, what is a big turnoff.
17:12When people are casual, it scares me.
17:14Because then I think they're going to be casual with my money too.
17:17That scares me.
17:18Okay.
17:18I respect that.
17:19I want to think about whether I want to, whether I want to do this.
17:32I've spent some time with Kimberly and Rick.
17:34Mm-hmm.
17:35I'm a little concerned about their casualness around money.
17:40Am I the only person that sees that?
17:42No.
17:43Spare no expense.
17:44It's that attitude of just, but I've made it so beautiful.
17:48She doesn't want it to look like it's a groom shop.
17:50And so that has been a struggle.
17:52What are you hoping for for yourself?
17:55I don't know if you know, but I literally left my husband and two of my kids in
17:59Arizona so that I could have this opportunity to transition to full-time teaching.
18:04Because that's the goal.
18:05I've been in the industry long enough that now I want to educate full-time.
18:08And when do you see them?
18:10When I can.
18:11And you've been here by yourself.
18:15I literally moved from one state to another to be a part of this opportunity.
18:22And I love my husband and I love my kids.
18:25And for it to not work out, I just can't even describe how frustrating and how disappointing
18:29that would be.
18:30And how do you get paid?
18:32Salary.
18:33What about a percentage of like all, have you asked for that?
18:37We've talked about money and I, you know, this is a startup.
18:41Have you gotten a raise?
18:42No.
18:43So no equity, no bonus and no raise and no family.
18:49Right.
18:50And if you went back to Arizona, what would happen to this place?
18:52I don't know.
18:59I think he would be an awesome pathology mascot.
19:05I want to go over and visit Kimberly because she's doing this community event where she's
19:10trying to attract new customers.
19:11And I want to understand, like, how do they collect data and how are they going to market
19:15to these folks after?
19:17We haven't met.
19:18So do you work with Kimberly and Rick?
19:20So I do PR for them.
19:21I have a PR agency.
19:22So as a business owner, which you are one, what do you think is a concern with the business?
19:27What's that?
19:28What's a constructive criticism that you have?
19:30So the one thing I've been telling them since day one, I'm native to LA, is they're in the
19:35complete wrong spot.
19:37I find it ironic that the woman who's handling PR for fluffology was so comfortable telling me that
19:43they have a terrible location.
19:45And no matter how much money you spend marketing, it won't matter.
19:49The only thing to do is to restructure and reimagine the entire business model.
19:54Let's go through the customer process.
19:55So you come here today, you talk to a lot of people.
19:59How did you collect the information?
20:03We didn't.
20:05We didn't.
20:05Normally we didn't.
20:06Normally we do.
20:06How?
20:07This is how we always do a giveaway.
20:09And they have to, they have to fill something out so that we capture their information.
20:13There's a term called ROAS, return on ad spend.
20:17And in this particular community event, they spent money to go there.
20:21How are they going to market to these folks after if you don't write anybody's name down?
20:26You know what the return on ad spend is for this event?
20:29It's zero.
20:30Okay, see you tomorrow.
20:32Thank you, by the way.
20:33Great job.
20:34How much do you pay her a month?
20:36Six.
20:37Six hundred?
20:37No, six thousand.
20:40Six thousand dollars a month?
20:42Yep.
20:42What does the average groomer make in your shop?
20:45Fifty-two thousand?
20:46Uh-huh.
20:46And how much do you pay your PR agency?
20:49Seventy-two.
20:52She's the only one, seriously, that helps you bring in business.
20:55I swear to God, no one else is.
20:58Except the people that do the grooming?
21:00They're not, they don't work on bringing business in.
21:02No, but they are the reason that people come back.
21:05Yes, but I feed them.
21:06They're the only reason people come back.
21:07I feed them like children, and I'm out there hustling my ass all day long.
21:12All right.
21:13Can I just talk to her for a minute by myself, please?
21:15Yep.
21:15I know how desperately you want this to work.
21:19I can feel it.
21:20And you're so scared that it's not going to work,
21:23and it's not working because you're so scared.
21:27I believe in this.
21:28I think it's a great model.
21:29I think it is definitely, we're going to be a premier pet destination place.
21:33But I'm telling you, I don't have this team support that I think you think I have.
21:37They don't support you the way you want them to?
21:39No, they just don't support me at all.
21:41They're spoiled on these people.
21:44In my mind, when I listen to Kimberly,
21:46she sees herself at the top of the mountain and her employees at the bottom.
21:51The only way she's going to be successful is if she sees herself at the bottom of the mountain,
21:56and she wakes up every single day pushing her employees to the top,
22:00making sure they're successful.
22:02That's what a leader's responsibility is to do.
22:05I would tell everybody that we're going to have a company meeting on Tuesday,
22:11and they better get their ass there.
22:14So without talking about it anymore, I'm going to get everybody in a room,
22:17and we're going to flush this out once and for all.
22:23Let's get down to it.
22:24I'd like you to list off two or three things that make you crazy in a negative way in working here.
22:32We'll start with you, Steven.
22:33Steven, there's definitely a lot of things that need to change as far as morale in here.
22:40And then time gaps. Obviously, I get paid commission.
22:44And then if I'm sitting here, I would like to be paid for that time.
22:48I'll say it as if I worked here. I would say, you spend money on lots of stupid ,
22:54but then you can't figure out how to pay me when you're willing to pay other people,
22:59like a PR agency, six grand a month.
23:04Did you know that?
23:04No. You paying those girls six grand a month is .
23:09It's a waste of your money when your groomers and your staff
23:13aren't getting paid as much as your PR staff aren't getting paid per year as much as your PR staff.
23:22That is delusional.
23:27Well, they don't just do PR. They do all the social media, all the content, all the posting, all the...
23:32But what do I do? What do I do?
23:33The groomers are the company. I made so little last year.
23:38Steven, do you mind sharing how much you made last year?
23:42Yeah, I made $26,000.
23:46You only work three days a week, right?
23:48Don't start blaming me.
23:50No, no, no, but you only work...
23:52I work four days a week, right?
23:54You only work three days a week, right?
23:56Don't start blaming me.
23:58No, no, no, but you only work...
24:00I work four days a week.
24:02Okay. No, I think that...
24:04There was time in the beginning where there was no appointments.
24:08Nothing. I worked weeks with nothing.
24:10And I stayed here for you. Don't blame me.
24:14Leo, your turn.
24:16For me, my position...
24:20It's always been fluid.
24:22My responsibilities have always just kind of, like, wavered.
24:26And it just kind of depends on the day and, like, the company needs.
24:28So just kind of, like, more strict.
24:30Um, so just kind of, like, more strict or direct.
24:32Responsibilities will help me not set you up or the company for failure.
24:38Thanks.
24:40I hate that.
24:42And I appreciate your vulnerability, Leo,
24:44because that's the best way to communicate is honesty.
24:46You're up, Liz.
24:48It is so difficult to deal with your highs and your lows and your inability to be clear and follow through and stay on track because it's all over the place.
25:00I have never worked this hard for somebody for so little in my entire life.
25:04I honestly thought that I would be teaching at the school portion at this point.
25:08What the hell am I doing?
25:10Why am I still here?
25:12How much longer are you willing to stay here?
25:14Six months.
25:16I think we should take a little break here.
25:20It's a lot to process.
25:22We'll come back in a few minutes.
25:24This process that we just went through with the employees, it proves to me that if Kimberly doesn't make changes to her leadership style, this business doesn't survive.
25:34Is Liz leaving in six months?
25:36If she doesn't see a path forward, she is.
25:39I think you got to take a breath in.
25:41What I wanted you to see here is they are pissed off at you.
25:45Oh, yeah. I think so.
25:46And so that's why you're not able to motivate them to do things.
25:50Managing people is really hard because I have to tell you, no matter what you do, no matter what you do right, they only remember what you do wrong.
25:56If you want to manage the way you're managing now, unfortunately, I don't think I can help you anymore.
26:01Mm-hmm.
26:02And I think they will leave.
26:03Mm-hmm.
26:04And the business will close.
26:05Right.
26:06There was a lot.
26:10I feel a little misled that somebody else is making a ton more money than me because the stylist is supposed to make the most money.
26:21We're the lifeblood of the company.
26:23I'm a tough bitch, but I'm also a crybaby.
26:28When they say I don't appreciate them, I can't remember the last time they ever have appreciated me.
26:36I am bombarded with, you're not doing this right, you're not doing that right, you're not doing this right, we don't do this right, you don't do that right.
26:43Stop with the attacks.
26:44Maybe it is just human nature, no matter how much you give people and no matter how much you do.
26:51You know, they just want more.
26:53Hey guys, can you guys come on back?
26:56Do you feel like you made enough money in the last year?
27:01No.
27:02Do you feel like you made enough money?
27:03No.
27:04Do you feel like you made enough money?
27:05No.
27:06Most importantly, do you feel like you made enough money?
27:09No.
27:10All right, so we're all going to cut the and you're going to do what I tell you to do.
27:13We're going to think about this in three zones.
27:16Zone one is the retail store.
27:19We need to stock it with things that we think speak to the neighborhood.
27:22So we're going to put in a chew and treat bar because it's high frequency, high margin, and it's going to give the business the profitability it needs to pay everybody the proper wage.
27:31That doesn't have to come out of their pocket.
27:34Zone two are the six booths.
27:37I want to swap out the tubs and tables so it's easier for you guys and it's way more efficient.
27:42In the back, the third zone, we're going to start what was promised to you with a very basic educational platform.
27:50Going forward, we have three rules.
27:53Every decision we're going to make, we're going to use a filter.
27:56Does it drive revenue?
27:58Does it improve morale?
27:59And does it plan for the future?
28:01If it doesn't check those boxes, it doesn't work.
28:04They have to know what the rules of engagement are.
28:07They have to know what their jobs are.
28:09They have to know what their expectations are.
28:11You have to give them a proper pay plan and stay out of their way.
28:14That's it.
28:16Look, I am up to here with Kimberly right now.
28:26You know the best way to get Kimberly to change her perspective about her people and the process?
28:30Make her do their job.
28:32And then she'll realize how difficult it is.
28:34And then she'll be okay with changing.
28:36All right, Kimberly, first thing we're going to do is check our water temperature.
28:40If it is warm on your skin, it is warmer on theirs.
28:45So you have a bar of soap that is hanging on the inside of your tub.
28:49And you're going to use that to saturate her entire face.
28:52Paying really close attention to her mouth where food gets in it.
29:01We're almost done, baby.
29:03In the time that we've been open, Kimberly has washed two dogs.
29:17Two.
29:18Two dogs.
29:20How's it going?
29:24Okay, well, that's over there.
29:28Our staff meeting was hard for me to digest.
29:31To hear and see those reactions and responses from my staff.
29:35Small sections.
29:36It was super tough on me and super emotional.
29:39I can respect how they feel.
29:41I walk past my groomers all day.
29:43I'm in and out of their suites.
29:45But I had no idea.
29:46It's hard work.
29:48I am open to changes.
29:51I'll give them a vote.
29:52Okay.
29:53Go ahead.
29:54Oh, what a good time.
29:55For me, the path to prosperity for this business is surrounding yourself with the right people and having more dogs.
30:04And the quickest, easiest tool is ZipRecruiter, which is like the best hiring site out there.
30:09All they have to do is create a job posting, and ZipRecruiter delivers qualified, experienced people quickly, and then hire them, bring in more dogs, and generate more revenue in the booths.
30:20It's that simple.
30:30How you doing, buddy?
30:31How you doing?
30:32Good to see you.
30:33Good to see you, man.
30:34I brought the team to one of the largest and best pet distributors in the U.S.
30:38And I wanted Kimberly and Rick to understand that it's not that difficult to figure out how to get to break even.
30:43You have to start looking for new ways to make money, find new revenue sources, find new margin.
30:48We're meeting the neighborhood at the price point.
30:51But I most importantly want to give Leo the assignment of overseeing the retail store so that he wakes up every day and feels like he has purpose and he can contribute to this company.
31:01That has a little novelty to it. Those should be flying off the shelf.
31:05I think ultimately, Leo, you are going to be fully in charge of that retail store.
31:10And then from that day forward, it'd be my preference that you have your wage and then you have an incentive directly tied to the sales where you can make real money.
31:19Don't you have a restocking charge when you take something back?
31:22No, not for Marcus.
31:24Okay.
31:25What a fabulous offer.
31:26It's almost like unbelievable that we're here and you're here and we're just meeting you now.
31:30This looks really great.
31:31Part of the reason that I'm so adamant about this chew bar getting set up in their retail store is that they're losing $22,000 a month.
31:39If they sell $1,000 a day at a 50% margin, that's $15,000 a month in gross profit, getting a lot closer to zero than they've ever gotten.
31:49But the real revenue growth is going to come from more customers walking in the front door and taking on grooming services.
31:56So I want to show you something that I had my friends at Salesforce built.
32:01They've launched a product called Agent Force.
32:03And it's essentially like having an executive assistant that helps you communicate with the consumers.
32:09So I want to show you an example of what will happen.
32:12All right. So this is your website.
32:13Right.
32:14And I had them build an agent.
32:16Hey there.
32:17I saw that you're looking at our various grooming services.
32:19Are there any questions I can help with?
32:21I'd like to book a groom for my dog Ezra.
32:25Could you please tell me Ezra's breed and age?
32:27He is a standard poodle and he's three years old.
32:31We would be excited to pamper Ezra.
32:33We love standard poodles.
32:35We have a 3.30 p.m. slot on Thursday at our Magnolia Boulevard location.
32:40It's the future.
32:41It's really the present.
32:42The primary adjustment that needs to be made to achieve a level of profitability for this business is for them to understand the TAM, the total addressable market within their neighborhood.
32:57And in order to do that, you're going to have to modify your pricing.
33:01How much does it cost?
33:02Like if this was my doggie, how much would it cost?
33:04So he would be 180 at his weight range.
33:07Our base price on our most expensive is 290.
33:10The lower the price, the more people are open to it.
33:13How did you establish this pricing model?
33:16I did a very elaborate spreadsheet.
33:18You may need an abacus to figure out what the pricing is.
33:23Is it a puppy?
33:24Is it have short hair?
33:25Is it four months old?
33:26Is it weigh this much?
33:27It's like, holy .
33:29It's just all way too expensive.
33:31What you're selling in that booth is time.
33:34That is correct.
33:35That's all you're selling.
33:36Right.
33:37You can make it very simple by saying, for a small dog, it's an hour.
33:40For a medium dog, it's an hour and a half.
33:42And for a large dog, it's two hours.
33:44And you just charge time.
33:45So I was thinking to max out this store, let's just do $99 for a groom.
33:53And you'd get away from all this complicated numbers.
33:57Look, whether Rick is right about $99 or not, I can appreciate him wanting to simplify the process and get to profitability.
34:04But that's just one component.
34:06There's a whole host of other things that I'm going to require Kimberly to do to help us get to profitability.
34:12There are assignments here.
34:14Read them out loud.
34:15New pay plans for the groomers, as well as incentives for growth on selling other products and services.
34:20Standards and expectations for groomers on what is expected of them.
34:24And that's what Leo said.
34:25He said, I just want to know, what am I supposed to do?
34:27Mm-hmm.
34:28Tell me what you expect of me.
34:29And you also need to get Liz out of the grooming booth and let her do some teaching.
34:33I'm asking you to sign up to get this done in two weeks.
34:37If I come back and it's not done in two weeks, I have no interest in investing.
34:41We're making it happen over here, Marcus.
34:51We're making it happen.
34:52We're getting rid of some of our retail items that just didn't sell.
34:55We've reconfigured a lot of the merchandise.
34:58We've put up sale signs in the window.
35:01We're going to have a small army of people distributing flyers directly in the neighborhood.
35:05And maybe we should do cafe tables back here.
35:10After over a month of working with this business Fluffology in Los Angeles,
35:25I'm back to see if all the changes that we've been working on have actually happened.
35:30Have we fixed the people, process, and product?
35:33I guess we're about to find out.
35:35Well, hello.
35:38One of my main rules in business is that if you don't know your numbers, you don't know your business.
35:43And Intuit QuickBooks gives our businesses the tools we need, all on one platform.
35:49At Fluffology, Kimberly manages a complex business with a growing staff.
35:53I love the fact that QuickBooks allows business owners to support our teams with access to health benefits and affordable retirement plans that integrate directly into QuickBooks payroll.
36:04Now that you know your numbers, you'll understand why I use QuickBooks.
36:08And you should too.
36:12Well, hello.
36:16Hello.
36:17How are you?
36:18I'm well, how are you?
36:19Yeah.
36:20How would you describe the execution of LA's biggest chew and treat bar?
36:26Yeah, I'd give it a solid seven.
36:27Like we're definitely headed in the direction that you want us to like head in.
36:44Leo, you did a really nice job in here.
36:46How's business been from your perspective?
36:49We had the best month ever.
36:50You did?
36:51Yeah.
36:52How much?
36:53$54,000.
36:54For the month?
36:55Yeah.
36:56I've been waiting for her to get over $50,000 for two years.
36:58Eliminating losses is good for our relationship.
37:01And ours.
37:04I want to see how Liz is doing kicking off the grooming school.
37:07I know, I know.
37:08Super excited.
37:09And all you're going to do is move your thumb.
37:12That's all you're going to do.
37:13Hey, guys.
37:14Hey.
37:15What's going on?
37:16Is that a real dog?
37:17Why don't you see and find out?
37:19Go!
37:21Are you starting from scratch?
37:23No, scratch.
37:24Have you ever done this?
37:25This is first.
37:26Okay.
37:27Not bad.
37:28I like it.
37:30I'm glad to see that Liz is able to do what she came here to do, which is to teach.
37:35But I also want to ensure the other changes I required have also been done.
37:40Show me what's different about the tub.
37:42So, your door is actually a ramp.
37:46Oh, that's so awesome.
37:49This table is super, super awesome.
37:52There is no lifting at all.
37:54Is it not as pretty?
37:55No, it's not.
37:56Yeah.
37:57Does it make everybody feel better?
37:58Yeah.
37:59So, what are we doing to address compensation with the team?
38:03We've drafted a commission structure for our stylist.
38:08My commission has gone up dramatically.
38:10Yeah.
38:11Okay.
38:12Yeah.
38:13So, what are we doing to get close to doubling your income?
38:15Yeah.
38:16In this year versus last year?
38:18Right.
38:19Yeah.
38:20Is the last 30 days shown that to be happening?
38:21100%.
38:22I'm able to pay my bills.
38:23I'm able to live a little more comfortably.
38:25So, you feel better.
38:26I feel better, yeah.
38:27New tub.
38:28Yeah.
38:29New pay.
38:30Yeah.
38:31New attitude.
38:32Yeah.
38:33How about everybody else?
38:34I think everybody is happier.
38:35Yeah, we've been booked and busy.
38:36Yeah.
38:37For sure.
38:38And how do you feel now about all this?
38:39You kind of re-energize us.
38:40And sometimes, you just need that.
38:42Can I have a minute just with them?
38:44Absolutely.
38:45Okay.
38:46How different is she, if at all?
38:49One, she's giving more actual autonomy to decisions.
38:53She's a lot more, you know, just personable,
38:56whereas before it felt like rushed and...
38:59Not acknowledged.
39:00Yeah, no acknowledgments.
39:01But now it's like, oh, can I get you a coffee?
39:03That stuff feels good as an employee.
39:05I'm happy with the progress here that's being made towards
39:08driving towards profitability.
39:09And I'm also happy to see what's happened with the people.
39:12But for me, I really need to decide what I want to do here
39:15with this business.
39:21Take a deep breath.
39:23I know, right?
39:25I feel like you are so close.
39:28And when I met you, I felt like you were so far away.
39:32After I left on day one, I was like, what am I doing here?
39:36Right.
39:37I want to tell you that I'm really proud of how you changed.
39:41It's part of the reason why you had your best month ever.
39:44I think, Rick, you've been really supportive of her.
39:47It certainly makes for a much more harmonious marriage
39:51and business partnership when you are not watching your life savings go out the door.
39:56Which leads me to what I would like to do.
39:59I have an interest in being a non-active backer of your business.
40:06And you understand that if I do that, I'm going to want a chunk of something.
40:09Mm-hmm.
40:10That's just how it is.
40:12I would like to task you with two things.
40:16One, get to profitability.
40:18You got 90 days to make money.
40:21Second, I want you to go to some mild level of an architectural drawing that shows the cost broken down by zone one, two, three retail.
40:31Where do we get our fixtures from?
40:32Mm-hmm.
40:33Where does the product come from?
40:34Where do the freezers come from?
40:35Go to zone two.
40:36Where do the tubs come from?
40:37Where do the tables come from?
40:39All of that.
40:40I want to build all of that out.
40:41What I'm trying to get you to build is the concept that somebody else could buy.
40:46You now can take people who want to be business owners and say to them, here's my playbook.
40:51We are certainly interested in being involved with you.
40:54I have an interest in being involved at some point, but not until you get to zero.
41:00Okay.
41:03Super proud.
41:04And you really did a hell of a job.
41:06We'll see you soon.
41:07Yep.
41:08Okay.
41:09Be good.
41:10Awesome.
41:11I am very pleased that Fluffology had their best month ever.
41:14And a big chunk of that credit goes towards Kimberly in adopting the filter system that
41:19I gave her, which is, do the decisions I make drive revenue here?
41:24And she did that by changing her grooming pricing and adding the treat bar.
41:28Do they improve morale?
41:29And she did that by giving the focus to the employees that they deserve with the right
41:34pay plan and the right freedom to be the best version of themselves.
41:38And does it set us up for the future?
41:41And I think she's done that by modifying all of those things that give this business a
41:46chance to succeed in the future.
41:48If she continues to adopt those three and embrace them, the next month and the month
41:53after that, we'll only get better from here.
41:56To have someone who finally says, all right, get here.
42:02And I'm committed.
42:03I'm thrilled to death.
42:05I really am.
42:06We were able to convince a smart investor like Marcus to believe in us.
42:12Maybe I'm feeling a little validated with all of the hard work that I have put in and
42:16my team.
42:17They want this too.
42:19And they deserve it.
42:20I'm happy to report that after two months and the team making all the changes and most
42:29importantly, working together, Fluffology has become profitable for the first time.
42:34It marks a new chapter in their future.
42:37It proves to me that when people can work together and have a common goal, well, that's
42:42when the profit comes.
42:43I need somebody with business acumen.
42:48We're actually not profitable.
42:50Our growth is flattening.
42:51Mmm.
42:52That's delicious.
42:53These suck.
42:54Now give me new ones.
42:55Shut it down.
42:56You're telling me to change everything.
42:59You emotionally did not come prepared.