Do you want to come over here . No. But this is business. I do it to save jobs, and i do it to make money. This the profit. [upbeat music] this week, im going to keyport, new jersey, a town that was devastated by Hurricane Sandy in 2012. Im going to meet the owners of mr. Green tea, a gourmet ice cream company. For nearly 50 years, mr. Green tea has been handcrafting exotic ice cream flavors and supplying the asian restaurant trade in new york city. So delicious. Way ahead of their time, mr. Green tea was producing flavors like green tea, ginger, and red bean. This Family Business was founded by richards dad, santo emanuele, in 1968, who ran it with richards older brother, james. Richards dad passed away, and then his brother died unexpectedly, leaving richard to run the business. Richard wanted to keep his family legacy alive, so he took over the business and brought his son, michael, with him. Michael, theres multiple problems. We gotta do what we gotta do. Unlike many of the businesses i help, mr. Green tea isnt facing a crisis. They generated over 2. 5 million a year in revenue, and the emanueles make a very good living, but the business is static. I have such a hard time making this decision. The emanueles cant seem to agree on a plan for their future. Michael has big ideas, but richard always plays it safe, and that creates tension. Its not 75. Just get dont mince my words. I hate that. I believe that mr. Green tea can be a 50million company. They need to be bold, and they need to take chances. They havent launched new flavors in over a decade, and theyre still not wellsituated in the retail market. The ice cream business generates well over 10 billion a year. I want a taste of it. Hello. Hi. Hi. Im marcus. Hi, marcus, nice to meet you. Im lori. Nice to meet you. Are you loriare you mom . Im mom. I wore green because i wanted to youre gonna fit right in. I wore green. [laughs] id love to meet everybody. Would you like to meetsure, come on in. Yeah, thatd be great. This is marcus. Hey, guys. Hi. How are you . Im marcus. This is dick, dicks our operations manager. Im dick, nice to meet you. This is my son, michael. Nice to meet you, mike. Nice to meet you. And my husband, rich. Hi, marcus. Very nice to meet you. How are you . Its nice to meet you. Heard a lot about you. You too. So, rich, tell me a little bit about the history of mr. Green tea. Well, you know, my dad started this business, you know, 45, 50 years ago. Hes the real mr. Green tea. He saw the need of highquality ice cream for the restaurants. He had a friend who was also in the ice cream business, and my dad believed you gotta sell to food serviceto restaurants, and his friend believed you gotta sell to grocery stores. My dad went his way, founded mr. Green tea, and put it into restaurants, and reuben went his way and founded haagendazs. So, you know. You see who actually had the better idea. Haagendazs as in as in the haagendazs, multibilliondollar ice cream . Exactly. Do you have his number . Maybe i can go do some business with him. Well [laughter] i like this story because its a classic case of being willing to take risks. In the case of mr. Green tea, they like to get up to the plate and hit singles, and in the case of haagendazs, they were swinging for the fences, and they took the biggest risk of all. They were willing to strike out. In this case, they hit a home run. If we can get mr. Green tea to take the same sort of risk, then they can be as successful, maybe even more. Whats the top line today . Were on track to break 2 million this year. Okay. So its a small business. Its small. But a decent margin business. Comfortable, butexactly. Yeah. Do you make the ice cream here on the premises . No, we dont actually make anything here. We use copackers, a few around the tristate area, and we travel to the copackers when we need to manufacture, make sure theyre to our quality control. What does that cost to go there . A lot. Ill bet you they are anywhere between 20 and 30 , yeah. Copackers are thirdparty vendors who manufacture and produce product for small companies. Mr. Green tea gives up about 20 margin by using copackers because they dont produce the product themselves. 20 margin on 2 1 2 million of revenue means theyre giving up about 1 2 million a year in potential profit by not making the product themselves. We have grown 20 every single year for the last five or six years, and the only reason were not growing more, especially this year, is we physically cant get enough ice cream. Theres logistics in the manufacturing and getting the product here. And for that matter, since we cant fill certain orders, were not actively going into new ones. Right. One of the other disadvantages of using a copacker is that you dont control the manufacturing process. That copacker could have 50 to 100 other customers, so youre allocated one time slot. If your business grows and you dont have more Time Slots Available with this copacker, it wont matter how many orders you get. Theres no time slots. Theres no way to make your product. Thats a big problem. We want to build a facility and bring all the manufacturing under one roof. And whats held you back from doing it . Well, i knowobviously, you get worried. You know, im very, very conservative, and maybe even too much. Conservative to a fault. Why is that a bad thing . Weve been talking about putting up a new facility for a long time now, and its just going slower than yeah, but in my opinion, it should but the thing is, itit you need the business there. You know, im not gonna put a facility up unless i know we have that much growth its the chickits the chicken or the egg. Exactlycoming in. What keeps you up at night, thinking about this business . Um, making a wrong decision, which would impact the company and the employees. And how about you, michael, what keeps you up at night . I think we lose out on the potential here of the company by not moving fast enough. Those are two very different philosophies, cause one is a little like, you know, im not gonna get anywhere near the edge, and you are just wondering, how close can i get to the edge without being deadly . Yeah. Actually, michael is like, can i actually jump over the edge and make it to the other side . Tell you, listen, its a the Food Industry is one of the most brutal industries. Michael, youre trying to defend yourself, but theres no defense. You cant have alet me f let me finish. Six or seven years ago. Seven years ago, yeah. When your wildest dreams, you couldnt possibly outgrow this facility, were there. In my opinion, mr. Green tea is not nearly as lucrative or profitable as it should be. Im afraid that if we dont hurry up along our path, that a bigger company, one of the major guys, will come along and squash us. This is the test kitchen area. What we do in here is test our supply of milk, sugar, cream, and ingredients, and make sure that the suppliers are giving us the same one every week. We have three skus. We have the green tea, the red bean, and the ginger. Well start with this, the green tea. This is our top seller. Yeah, hence the name, mr. Green tea. Look at the color. Its been the top seller for what, 45 years . Yeah. That green teas good. Isnt it good . Mr. Green tea currently makes three pint flavors, and after being in business for this many years, well, thats not good enough. I want to see them expand their product offering, expand their flavors, and appeal to a much broader audience. What does it cost to launch, to develop a new flavor . A lot. Between the milk and everything, well go to a facility, have it run, and test it. That gets expensive. Im gonna say 10,000. Launching a new product line is a costly investment, and its risky, especially when youre dealing with copackers, cause theyre gonna charge you a fortune to make a small batch. If we wanted to get into, lets say, a hundred stores this year, in 2013, itd probably cost us about 40,000 to 50,000. See, i think more than that, because do the two of you communicate about these numbers very often . Michael does not do the numbers on an everyday basis like i do. If you dont know your numbers, you just dont know your business. I mean, its just that simple. I know my numbers. You know your numbers . I know my numbers. Okay. Absolutely. If an investments gonna be made, numbers are everything. Look, richard is all about the numbers, and he leaves very little margin for error, and michael has big ideas, but he doesnt pay enough attention to the numbers, and that could lead to big problems. I noticed on the website that you also have some mochi. Yeah. This is a mochi. Yeah, they come individually wrapped. Its a little bit of ice cream with a sweet rice dough on the outside. I tell people its like a ravioli. So this dough is you were saying is sweet rice flour. Sweet rice. Like a ravioli of ice cream. This one i believe is black sesame. It is black sesame. Yup. Whoa. Ive never seen it individually wrapped in this package. Wow. Isnt it good . Itd be interesting to figure out a way to retail this. I agree. Mr. Green teas products are great, but i need to know more about their process and their daytoday operations. Walk me through the logistics here. What is this space here, and you know, what happens here . Okay, here we have the freezers where we keep a lot of the stock. How does the product get from the copacker to here . We pick it up. Theres three trucks. You know, its a Constant Movement of product. Its gotta cost a lot to do that. Its very intricate, because if you miss one day, its a Chain Reaction that screws everything up. So this is where all the inventorys kept . Right here. So what is there, one or two weeks supply in here . Uh, probably about a week right now. Ill give you a lot of credit, it looks organized, it looks right. Yet another problem with copackers. Were burning a lot of money transporting product from the copacker to our storage facility. We need to build a factory right away. How much money does this business need to go to the next level . I think whatever it takes to build a facility. Have you looked at any . Yeah. Whats the output . How manywhats the Production Capacity . Quadruple what we could get what we could bring in now. For every one you make today, in a new facility, you could make four . Correct. Wheres the facility at . The building were looking at is in keyport. Can you take me to see it . I could. All right, so this is it. Its been vacant for 25 years, and theres so much crap in it, its unbelievable, you know dont be too enthusiastic. Yeah, well, you know, the roofs been leaking, the stuff fell, it was flooded, its who knows what youre gonna find in there, but and then more after the storm. I personally think its beautiful. I love the building, i love that were right here. I know michael doesnt want to hear this, and he gets crazy when i talk about it. I think what scares me a lot about it is the uncertainty of what its going to cost. Because i know thatall right, the building, thats money you gotta lay out immediately. If its a 300,000 price tag to buy it, thats way too much. You know, you get so far in, and then the problems that youre gonna have with whats uncovered, you know, um i would go right now, just get going. Whoa. Isnt it beautiful . You know, look, michael, the more i look at this place, the more scared i get. Stop looking at it. This building is a total disaster after Hurricane Sandy. Were gonna need to redo everythingthe plumbing, the electrical, the ceiling, the floors, the windows, the walls. Its a total mess. Were gonna make it right, though. Do you want to come over here . Uh, no. Ill piggyback you. Thats okay. What a mess. It seems like theres a theme that goes on where you want to get stuff done now, and you want to talk about it. Cautiously. Right, right, exactly. The building costs x, the build out costs y, those two add up to a number. What do you think it takes to get it all the way to open . How much money . 600,000 mark. Remember, im relying on your numbers for the return, so. Its accurate. Its low. Yeah, i mean, the, uh, manufacturing equipment is gonna cost about 225,000. The freezer, im expecting about 80,000. And how much margin do you think youre gonna pick up by making your own stuff . At least 25 . 20 just to be on the safe side. So it takes a little less than two years to get all your money back . To get everything back. Exactly right. At the end of the day, if it takes, from your mouth to my ears, 600,000 to get it right, and the return on the investment happens in less than two years, then i think what we need to do is get to work on getting it. Businesses are usually about three things for mepeople, process, and product. I think the products excellent. I think the people are fantastic, and i think the process is broken because were giving up margin to a third party when we can do it ourselves. The basic premise behind this investment for me is, can i double or triple my money . Can i trust the people that im doing business with . Youre now at a point where youre not gonna go anywhere unless you do something different, and i think the Business Needs capital without pressure. What this business really needs is an investor whos willing to take chances and is willing to put money at risk for the upside. So my offer is 600,000 for 35 of the business. Hmm. I, uhii had other ideas. I wanted to talk about royalties and stuff like that instead of, you know, just a clear percentage. I dont know if im willing to give up any ownership of the business. The reason that i dont want to be a lender is because i want to be on the elevator. If i didnt think there was something good, i would be a lender at a high rate. Right. But i think theres something here. I want to invest my money in mr. Green tea for two simple reasonsi know its safe, because they have the financial controls in place, and they manage their money probably better than ive seen any business so far, and i know my return on capital is gonna exceed my expectations. I think my offer is very fair. I think my offer is well thoughtout. I mean, without me, youre gonna stay a 2million company until hes 60. This is something i would really have to think about. Thats a real check, by the way. Ii see that. [laughs] i[sighs]ii have to think about it a little bit. Well, let me step out, so you guys can talk not in front of me, okay . Okay. Okay. Are we willing to take this right now . I didnt expect marcus to make an offer so soon. Theres no doubt taking this deal will excel the company. Its a very high percentage. Learning doesnt come free. Listen, with the life that you dont know whats around the corner, i say go for it. I dont think youeither of you can convince me. Youre not gonna lose. No, i cant, lori. I dont think so. I think my fathers at the point where hes comfortable. Hes not hungry anymore, and theres a lot of people here that are. I think we can bring it to the next level. I know we can bring it to the next level. The fact of the matter is, the company is not nearly at the potential it can be at. We need a facility. We need more flavors and more marketing money. Unfortunately for you, this is my company, so you know what, to think that its unfortunately for everybody here. Well, this is not home. This is the office. You are strangling the progression of the business. Back up. Youre crossing the line between father and boss. Do not come in here again and speak to me that way. They know the product. I dont agree with that. Quick close. Sell him. 1 4 million is out of the question. And during this event, you can get a great deal on this jetta. It drives great. Volkswagen believes safety is very important so all eleven models come standard with an intelligent crash response system. Hmm. And seven stabilityenhancing systems. Hmm. For more confidence. On road trips. Hmmfff. Hmm. For those who take safety seriously. Like we do. The Volkswagen Safety in numbers event. Hurry in and get a 1,000 volkswagen reward card when you purchase or lease select new 2015 or 2016 volkswagen models. E trade is all about seizing opportunity. And id like to. Cut. So im gonna take this opportunity to direct. Thank you, well call you. Evening, film noir, smoke, atmosphere. Bob. Youre a young farmhand and e trade is your cow. Milk it. E trade is all about seizing opportunity. Its intelligent drive is msystems. Ng. Paradigmshifting. Its technologyfilled cabin. Jawdropping. Its performance. Breathtaking. Its selfparking. And selfbraking. Showstopping. The allnew glc. Mercedesbenz resets the bar for the luxury suv. Starting at 38,950. Is that coffee . Yea, its nespresso. I want in. Youre ready. Get ready to experience a cup above. Is that coffee . Nespresso. What else . What . You know, i think its worth mo than that, but its not about that. Well, as we said, we looked at the upside. Its not about it. The upthe downside of not taking the deal, and like i said, thats you know, marcus, i didnt i didnt expect, um actually, we didnt expect this to happen today. So quickly. cause we thought there was gonna be days, days, days. Why dont we go through a number of questions that you may have . Okay. So my dad takes this check. Mmhmm. And you receive 35 of the company. Mmhmm. You know, the daytoday operations of the business are gonna stay right here. I dont care. In this office. You dont want any part of that . I dont want any part of it. If you need my advice or you need some input, youll call me. And this isthis is not a sleep on it deal . I cant think about this at all . This is a you can, but the deal will get worse. You will never change this business model, ever, without me. [sighs] um. Obviously, its very lucrative. Its lucrative on both ends. Its a nobrainer as far as im concerned. So do we have a deal . We have a deal. I feeli feel better. Okay, so theres a catch. Okay. Sit down. The catch is, when you take my money, for the next week, im in charge. Do you understand that . Okay. And its gonna be a very long week. Were here tomorrow early. Rise and shine to work. I would like if you dressed like im gonna dress tomorrow, which is in a tie and a shirt. Yes, i will. Be a little more professional. Okay. You dress however you want since you own the joint. Okay. And were gonna go to work. Night. [sighs] we live and die by our decisions here, and theyre never easy. Theyre never, never easy. When i go in to look at business, i look at people, process, and product. I love the product. Its spectacular, but i am worried that theres not enough variations of product. I feel like were pigeonholed into one thing. I think the most exciting thing is gonna be developing some new flavors. Currently, mr. Green tea has a limited numbers of flavors, and theyre focusing solely on the asian restaurant market. I want to expand new flavors and new locations, including retail stores, so that we can become a household brand like haagendazs. When it comes to the process, today, our relationship is with copackers, and those copackers have us at their mercy. They control the supply. They control the pricing, so i want to explore alternatives to being reliant on copackers. Were gonna open our own manufacturing plant, which will put us in charge of production. We will also be able to cheaply create and test new products and new flavors. All these changes will give us the ability to go from 2 1 2 million to 5 million within 12 months. Im expecting to go to 30 million in the next four to five years. The last one is people. I think you guys have a wonderful family, but the dynamic between father and son is always a tough challenge in business. There are some issues. Rich has to learn how to take some chances. I like cash in the bank like you do, and i dont like debt, but i also like growth. You know what concerns me about michael is that he doesnt know his numbers the way he should. All right, lets go to work. Id like to go maybe make some ice cream, do that. Lets do it. So educate me on something. Once the ingredients are established. Yes. They can be modified into frozen yogurt . They can be modified into soft serve . Correct. Its all the base. Its important for mr. Green tea to expand their flavors and products, because once people fall in love with the brand, we want to make sure that we have a flavor for everybody. Theres two ways you can grow this business. You can grow it vertically, up and down, by developing new flavors, or you can grow it horizontally, by creating new brands and new ideas. I want to make sure that we hit all parts of the market from a 5yearold to a 50yearold. What i dont like about the Business Today is, i dont like that the whole Business Foundation is based on one name. I always thought that we could do another brand, another spinoff. I thought maybe we could do a Gelato Company cause we are italian, and we, you know, deal primarily in asian flavors. Itd be nice to take our heritage into making some of the products that we make money on, so i came up with the idea of solo gelato, cause the word solo means the same thing in italian as it does in english. I love it. Its a singular flavor. Solo. One. So the tagline could be something like, sometimes all you need is one bold flavor. I love the idea. It is a good idea. But . Theres always a but, but but launching a whole new brand i never really thought about launching a whole new line. It would beits gonna be its gonna be expensive. I think michaels idea to create a gelato line was brilliant because he understands that taking a facility that were already gonna be operating making ice cream and creating another product inside that same facility, getting the efficiency out of it, i mean, honestly, im very impressed with him. So you need to start to think about an umbrella brand and really creating something that these different flavors can sit inside of. Creating a gelato line called solo should not sit under a name brand green tea. I have to tell you, and i have to be very honest about it, is that in order for this business to grow, it will never function well under the green tea name. They know the name. They love it. Nobodys going to buy blood orange gelato. Mr. Green tea ice cream. From mr. Green tea. The actual green tea flavored ice cream, which is what the bulk of the business is, i would never advocate changing the name of that, ever. This package will never change. Mr. Green tea would be the flavor. Then what would you call the brand . You know, if i just was kind of brainstorming and coming off the top of my head, you know, why wouldnt you call it keyport creamery . The keyport creamery is an Emanuele Family company, right . Very nice underneath, and we offer since 19. Both 68. 68, the most fantastic line of green tea ice cream, ginger ice cream, red bean, but weve now started to expand into. Both solo gelato. And. Mochi. Mochi, and whatever else you decide to launch. Youre right. Yeah, ii like the ideas, yeah. Ive arranged for michael and richard to have a call with the bank, so they can negotiate for the building we saw the other day. So what do we want to do the initial offer at . I think we have to offer at 200,000. 200,000 . Right. And well sign the check today . Yes. Is that what were telling them, yes . Yeah, it will be a done deal. [dial tone] [dialing] [line ringing] hello, this is niko. Hi, niko, its mike again from mr. Green tea. How you doing . Good, guys. How are you . Good, good. I have the three investors here with us, and we want to make a deal happen quickly. So i had mentioned to you guys thethe 275,000. I mean, i know theres some back taxes and stuff that are due. Can you give me an idea of what you were thinking . We were thinking about offering today, trying to get it wrapped up quickly, at 200,000. No way. I could [sighs] i could potentially do 250,000. 1 4 million is out of the question. Thats crazy. I dont think you understand the amount of work that this place has to go through before its even habitable. I dont hear you telling him the reasons why, in cash, and the reasons why. Quick close. Sell him. Michaels struggling during the negotiation, but what i do like is that he convinces himself that he has the knowledge and the energy, but he just doesnt have the experience. Listen, were doing no financing. Cash deal. Quick. Get it done with. Listen, i appreciate what youre telling me. Im just telling you, i cant agree to that. I can agree to 240,000. I cannot agree on anything less. Well do 230,000, and well wrap it up today. I cant. I cant. Okay, well take the 240,000 deal if you pay the taxes. No, i just told you, i cant. All right. Both 15,000. Yeah. So youre paying 255,000. Were paying 255,000 on it, yeah. Lets split the taxes at 240,000, then. I cannot. You will not go a penny below 240,000 . I cant. What do you think . I could have spent that 18,000 five other ways. Michael, the word that comes to my mind is reckless. Ive been on my feel all day. Im bushed yea me too. Excuse me. Coming through ride the gel wave of comfort with dr. Scholls massaging gel insoles. Theyre proven to give you comfort. Which helps you feel more energized. All day long. I want what he has. There is a dangerous instinct that lives within you. You like chaos. And in these times, we need that. We need you to rush in, when everyone else is running away. Introducing the jeep renegade, dawn of justice special edition. It took Joel Silverman years to become a master dog trainer. But only a few commands to master depositing checks at chase atms. Technology designed for you. So you can easily master the way you bank. I tabut with my back paines, i couldnt sleep and get up in time. Then i found aleve pm. Aleve pm is the only one to combine a safe sleep aid plus the 12 hour pain relieving strength of aleve. Im back. Aleve pm for a better am. Lets split the taxes at 240,000, then. I cannot. You will not go a penny below 240,000 . I cant. I can look at what i would sell it for and take out expenses that i had factored in, and i get the net number. Hi, niko, this is marcus. Im a new investor in mr. Green tea. Hey, marcus. Are you greek . Yes. So am i, lemonis. So. Oh. Its two greek so, see, you know how the greeks are, then. Thats 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 banks position. So if we just signed a deal to buy the banks 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, im not only gonna get the warehouse as collateral, but im 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 net result is the same. Yeah. To me a note sale is actually an easier deal, and i have no problem with that. If you could do 240,000 for the note, i can tell you that that number works. Under these terms, are you comfortable moving forward . Yeah. Okay, so we have a deal then . Yeah, 240,000 will be the purchase price. Let me ask you a question. This is more of a trivia question. What would you guess that we do as a company . Mr. Green tea . Yes. Uh, make tea leaves . Okay. [laughs] thanks, buddy. I appreciate it. Efharisto. Whatwhat do you do . We make ice cream. Oh, really . Yeah, thats what i said. [laughter] you might want to think about your rebranding. [laughter] oh, good. Good point. Thank you. I mayi would have paid you 245,000 for that. [laughter] holy moly. Look at you. [chuckles] whats up . Looking sharp. Thank you. While the warehouse papers are being drawn up, ive asked the graphic designers to put together some new looks and logos for not only the company, but the solo gelato line. So this would be a sort of, kind of a print campaign for whatever flavor we wanted it to be. I love that. Thats awesome. This is crack one at solo. Theres another look here. Love that one. I like that one as well. Very european. I agree. I like em. Ii really do. This one, i mean, you know, listen, women sell products very easily. This makes you turn. Well, sex sells, so i mean. Yeah, but its just, you know. I was surprised how much rich liked it, and it was interesting to stand back and watch lori and michael and rich kind of debate on styles and colors. I want them to pick something that they love. Is this whole thing a little surreal for you . Because some of these things youve been wanting to do for a long time. It would have taken michael and i, like weeks. And could we even do it . So based on richs pace, we could probably have this done by 2035. [laughter] two thousandat least. I would get it faster. I said, rich, youre gonna have to learn to move a little faster. All right, guys, thank you. Thank you so much. Michael called and told us to meet him outside the office. He has a surprise for us. [horn honks] what do you think . What is it . Its a fiat 500. Well, i know its a car. I know what kind of car it is. Whats your thought here . What is this . Its a mobile promotional vehicle. Its a way to test the retail theory and see how many people actually want to buy mochi ice cream and mr. Green tea products in new york. Really low operating cost. We can get about between 650 and 700 mochi in this freezer. Out the door car, graphics, and the freezer was 18,500. 18,000 . How many mochi do we have to sell to pay for this . Uh, i do have numbers. I do have numbers. Okay. Theyre in my head. [laughs] that doesnt i was really caught off guard when michael went out and made this extravagant purchase without anybodys permission. Its a bold move, but its impossible to determine if its a good return unless you run the numbers. You know, you just cant keep all these numbers in your head and think that everyone could read what youre thinking. Why cant you trust that i know what im doing . Because i could have spent that 18,000 five other ways. Michael, the word that comes to my mind is reckless. I have a construction crew getting ready to clean up this building, like, tomorrow morning. I think ii need more time. The eclass has 11 intelligent driverassist systems. It recognizes pedestrians and alerts you. Warns you about incoming crosstraffic. Cameras and radar detect dangers you dont. And it can even stop by itself. So in this crash test, one things missing a crash. The 2016 eclass. Now receive up to a 3,000 spring bonus on the e350 sport sedan. 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This place has hotcakes. So why arent they selling like hotcakes . With comcast Business Internet and wifi pro, they could be. Just add a customized message to your wifi pro splash page and youll reach your customers where their eyes are already on their devices. Order up. Its more than just wifi, it can help grow your business. You dont see that every day. Introducing wifi pro, wifi that helps grow your business. Comcast business. Built for business. Michael, the word that comes to my mind is reckless. You know what, its that wasnt a reckless purchase. Whats its gonna cost to insure . Gas, repairs, maintenance, all these things. Tolls, everything. Itsyeah, but i factored that all in. But you have to show that. You have to show that to me. You have to show that to marcus. You have to show that to all of us. Look, its a bold move, and i like the concept, but how are we gonna know if it makes sense if you dont run the numbers . Hes got better ideas than all of us, but whats inside your head has to come out on paper. The lesson to be learned is it has to be on paper. It boils down to communication. Were gonna communicate from now on. Its been 48 hours since we toured the building and made the deal. I am excited how quickly things are coming together. All right, this is a loan sale agreement. The building is officially ours as soon as rich signs. Its, like, so fast. [laughs] the one thing i know about business is you have to move quickly, or youre gonna miss out on a good deal. [sighs] youre making me nervous. I know those sighs. Youre all good with this . Its what we wanted. Do you see a problem with it . [sighs] no, i dont see a problem with it. Ii guess i thought i was gonna have more time thinking about it. Its what we want. Maybe i need more time. Whats that look for . Icause iits i think ii need more time. I have a construction crew getting ready to clean up this building, like, tomorrow morning, and i asked you if all these things, and you kept saying to me, well, those are all ifs. I need to see it on paper. Well, here it is. I mean, listen, if you want to keep this company a 2million company, then just keep things the way they are. [sighs] were always gonna get to the point where hes gonna say yes and then at the last minute hes gonna say no. Its justits just overwhelming to me. I justi hope you guys dont get too disappointed. Ii just cant sign this right now. Ii just cant. Even though ive given rich everything he needs, hes still reluctant to take risks. Lets go take a walk. Rich needs to take a moment and clear his mind. Hopefully, hell get past it and make this deal happen. I dont understand. Its too fast. That makes no sense i dont know what happened back there, but you obviously got something on your mind. I got too overwhelmed, you know . All of a sudden, the reality set in. I guess everything happened. It came true so fast. It just became a little overwhelming. What i dont want to do is, i dont want to sell you on this concept. You have to really want to do it. When i decided to move forward on this project, i did it for one simple reasonthe economics gave us one heck of a return, so if we end up having 600,000 to 800,000 in this building, its very simple math. Right. You told me that you thought the margins that were evaporating from our business were anywhere from 20 to 30 . Our Current Business is 2 million, so on 2 million of business, its anywhere from 400,000 to 600,000 a year. Right. Evaporating. Right. I want to try to bring that back, but whats even more important is, that factory gives us the ability to satisfy the demand that you say is out there, so its justitsrich, i mean, im not gonnaas i said to you earlier, im not gonna sell you on it. Right. Youre a smart guy. You do the math. So whether im a part of this business or not, the ice cream will still get made, but it wont be as profitable. Right. It wont be as big, and it wont be ready for michael to take it over if you dont take this step. Your numbers werent right. It was a mistake. This is never gonna happen again. Aflac. Ohh ah ah aflac aaaaflac tadaa hes not a very good magician. He paid my claim in just one day. One day . shh how does he do it . In just one day, we process, approve and pay. One day pay, only from aflac. boy mom because weresettle settlers and thats what we do. girl but with directv and at t, you can get your tv and Wireless Service from one provider. dad are not we your providers . Do we not provide you with this succulent jackrabbit pie . This delicious graywater soup . And a single lick of the family lolli every harvest moon . vo dont be a settler, get a 100 reward card when you switch to directv. And we are theic plays hbug chicks. Ie and im jess. We are a nanobusiness. Windows 10 really helps us get the word out about how awesome bugs are. Kids learn to be brave and curious and all kids speak the language of bug. Hey cortana, find my katydid video oh this is so good. laughs if youre trying to teach a kid about a proboscis just sketch it on the screen. I dont have a touch screen on my mac, im jealous of that. laughs you put a big bug in a kids hands and change their world view. laughs whether im a part of this business or not, the ice cream will still get made, but it wont be as profitable. Right. It wont be as big, and it wont be ready for michael to take it over if you dont take this step. Imim ready. Ii feel better. You know, just getting out and clearing my head a little bit and just talking to you oneonone. Imim ready. Your dad and your brother would be very proud of you. They would be. They would be. I know they would be. Cleanup is finally under way at the warehouse, but a big problem has come up, and i need to meet with michael immediately. Michael, theres something that i want to talk to you about, okay . Okay. From the beginning, weve been talking about 600,000. Is the building and the build out and the equipment and everything. The building costs x. The build out costs y. What do you think it takes to get it all the way to open . How much money . 600,000 mark. Remember, im relying on your numbers for the returns, so. Its accurate. Its low. I made this investment largely because i believe in you. I didnt factor in all of the details because im not an engineer or an architect, and i knew you were working on the drawings, then i get an email that says the building isnt gonna cost 600,000. Its gonna cost 1. 3 million. I have 240,000 in the building. I have 50,000 in the cleanup of the building. Thats already 300,000, and we havent bought the equipment yet. The equipments gonna be 200,000, and to build out the space is gonna take nearly a 1 2 million. I dont like surprises. Im committed to you. Mmhmm. Im committed to mr. Green tea, and im committed to your family, but i am not committed to having numbers double on me. Do you understand that . I do. I cant move forward. Mmhmm. If i dont know for sure what the numbers are gonna be. When the number came back at 1. 3 million, you know, more than double whawhat the original estimate was. Mmhmm. Im not gonna lie to you a little sticker shock. Itwell, it kind of pissed me off, because weweve been talking about the fact that you have to know your numbers. Mmhmm. Do we know our numbers . No. We werent 100 accurate on them. I mean, really, the question for me was, when i got that email is, am i doing a bad deal . It was a mistake. But its a mistake with my money. I know that. I didnt know my numbers. It was a huge mistake, clearly. Theres this old adage in business, right . Its underpromise and overdeliver, and in this case, we overpromised and underdelivered. Im frustrated, and im angry. Im still gonna move forward with this deal, cause i know that my money is safe with this company, and i know were gonna be wildly profitable. I guess the disappointing factor is, its gonna take me a little longer to make a return on my investment. Look, this is business. [clears throat] your numbers werent right. I need to know for sure that this is never gonna happen again. It is never gonna happen again. Okay . Yes. All right. So im real excited for you to see the inside. We got a lot done. I know you were worried about the 40,000 to clean the place up. For the cleanup. 40,000 to clean up garbage . Did you see it . [bleep], id have come done it myself. There was a lot to clean up, and believe me, you wouldnt have. Michael, you did a great job getting this place cleaned up. Thank you. I mean, you move as fast as i do. It happened quick. Its a great shell. Its a beautiful building. It really is. It just needs a little polishing. Im kind of blown away at what i see at the warehouse. Weve spent almost 50,000, and we havent even built it out yet, but the warehouse looks amazing. So back here, the whole length of the building is the freezer. The freezer will go this way, trucks will come in here, and well have a really easy workflow from our deliveries directly to the production room. Im starting to really see the vision that michaels laying out. Were making a lot of progress, and were making it fast. Were gonna have a firstclass facility. Probably the best on the east coast. Everything from the freezer to the equipment thats coming from italy is the best in the world. And this is what we have to show your dad. Mmhmm. Is the investment. Mmhmm. We know that were gonna have a 20 margin improvement on that 2 million. Mmhmm. Thats a 400,000 annual improvement in margin. Correct. So in about two years, were going to have our money back. And its funny because your dad, if he would have just sat down and done those numbers. Mmhmm. He would have done it a long time ago. One of the beauties of this particular transaction is were gonna make an investment in an american town that was hit hard by the hurricane and, i think, can get back on its feet very fast, but we have a lot of work to do. Keyport, new jersey, has a new anchor. Mmhmm. For Business Advice and extra scenes from the show, go on to cnbc. Com theprofit. There has to be a way. Carry the centimeter, divide by 3. 14 something something something. [ beeping, whirring ] great caesar salad and now the name your price tool shows people policy options to help fit their budget. Is that a true story . Yeah people really do save an average of over 500 when they switch. I mean about you inventing it. I invented the story, and isnt that what really matters . So. What else about me . If legalzoom has your back. S, over the last 10 years weve helped one million Business Owners get started. Visit legalzoom today for the legal help you need to start and run your business. Legalzoom. Legal help is here. It recognizes pedestriansligent driand alerts you. Ems. Warns you about incoming crosstraffic. Cameras and radar detect dangers you dont. And it can even stop by itself. So in this crash test, one things missing a crash. The 2016 eclass. Now receive up to a 3,000 spring bonus on the e350 sport sedan. Okay, guys. I put these numbers together for next year. I think our growth next year is gonna be tremendous. I am projecting probably about 35 to 50 growth next year. So you think we can do almost 4 million next year . Ii believe we can. The company, in this next year, looks like its gonna grow by leaps and bounds. I know richards numbers are conservative, and this is an exciting time for mr. Green tea. The factory is scheduled to open in the next 90 days, and the copacker will be gone, which will give us the ability to double our profit from 450,000 to 900,000. In addition to that, rich has 1 million of orders sitting on his desk, and i expect those orders to get processed very quickly. I learned about calculated risk. To make decisions in this company and any company, you have to really weigh the pros and the cons. And everything you do, every decision you make in a business has to have that riskreward. You guys have pulled off, in my opinion, what is one of the hardest things to do in american business, which is to have a Family Business, because so often the failure rate is off the charts. You should be very proud of yourselves. Were good. Were strong. You said you had some new something new to try . Something new i whipped up for you. Thank you. Dont tell me what it is. Okay. Im gonna try to guess the flavor. Oh . I taste a lot of chunks of ginger. This is a very little. You dont like ginger . Candied ginger puree. No, i like ginger. With a ginger dice. I can launch this chocolate, tahitian vanilla, and black sesame honestly, no bull[bleep], before the end of the year. Cheers. Good ice cream, cheers. Keyport creamery is well on its way to becoming a household name. Michael has been working really hard to push the mochi and the new solo product line. 1. The response has been fantastic. Were looking into retail space in new york city. Youre a block away from times square, and the traffic up and down here is tremendous. Mr. Green tea continues to grow its restaurant clientele. I have our new coconut gelato. Both mmm. The equipment is on its way over from italy, and once its installed, well have one of the most stateoftheart ice cream manufacturers on the entire east coast. The building will be able to produce 1,600 gallons of ice cream a day. Itll have over 18,000 square feet of cubic freezer space to store all the product. The mayor of keyport has given us the citys stamp of approval to build out the warehouse. All right yeah. Whoohoo its got an opportunity for jobs as well as sprucing up the area. Opening the factory in keyport is gonna help the city by creating new jobs. More importantly, the relationship between father and son is the best its ever been, and they have a newfound respect for each other. There is no doubt in my mind at all that mr. Green tea will be a National Brand and make richards father prouder than he could ever imagine. Lemonis tonight on the profit. Lori hey. Lemonis two years ago, i bought an interest in mr. Green tea ice cream. Young man this is actually amazing. Lemonis and while weve been able to increase sales by nearly 100 . Is that your car . Michael thats my car. Lemonis . Success has spawned a whole new set of challenges. Michael the entire future of the brand is based off of my vision. Richard thats something im not so sure of. Lemonis the owners son is pushing for a piece of the pie. Michael i think 7 to 10 would be more than fair. Lemonis but his cavalier attitude isnt helping his case. Michael who cares about a 10,000 upfront cost . Lemonis i think we all kind of care about the 10,000. And now a family feud is brewing in the business. Richard whats important to me is the most important thing. Michael youre not making any sense. Youre making stories up