Transcripts For CNBC The Profit 20160311

Im not talking about it anymore. I back them up, spending my own money. Its 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 fairfields local institutions. For over 40 years, theyve been selling fresh fish, hot soups, and doing a little catering and, along the way, got their fair share of critical acclaim. Gary okay, youre 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. Gary completely devastated. Lemonis not only did the family lose income for an entire year, but they lost a good portion of their customer base. Gary we definitely need to pay a couple of these vendors. Hopefully, we have enough money in the account right now. Lemonis when the store finally reopened, a year after the fire, gary was 900,000 in debt. Sue mondays deposit that should have went in on tuesday didnt go in till the following week. Gary im put against the wall. Lemonis sue is so demoralized by the downturn that shes spending less and less time at the store. Sue i need a break. Im reaching my boiling point. Lemonis . Forcing their daughter, larissa, to come home and work with her dad and help pick up the slack. This is a critical time for swansons. Gary i really dont know how much time we have left. Lemonis familyrun businesses like swansons are the lifeblood of this country, and i know with the injection of some cash and some improvements in their process, i can rejuvenate the business and turn swansons into a big fish once again. Swansons location seems great. Its on one of the busiest streets in fairfield, its in a beautiful building, and theres two other businesses next door. Spencer morning. Lemonis how are you . Im marcus. Spencer spencer. Lemonis hey, nice to meet you. Spencer you too. Lemonis im marcus. Paul how you doing, marcus . Im paul. Lemonis nice to meet you. Paul good to meet you. Lemonis wow. You got a lot of good stuff. Paul yeah, were working on it. Man how you doing . Do you have 2 pounds of red snapper . Spencer no reds today. Man no reds . Spencer no. Man well, im gonna try some grouper today. 2 pounds. Spencer okay. Lemonis what else are you out of . Paul i believe we are out of tuna. Lemonis tunas kind of a popular fish to be out of. Is gary, the owner, around . Spencer yes. Ill go get him. Hes in the office. Lemonis okay. The place is definitely underutilized. I look to the left, and theres this big counter with nothing on it, nothing merchandised on it. It definitely has room for improvement. Paul i mean, this is a great place. I love the job and everything. Its just that sometimes it gets a little bit stressful when you dont know whats going on. Lemonis what kinds of things are you paul like money, really, to be honest with you. Sometimes, were asked if we mind waiting for our checks a week or two. Weve had problems paying for product. So weve all pooled our money together on several occasions lemonis people that work here . Paul yes. And helped them out. Lemonis how much are we talking . 100 bucks . Paul a couple hundred each. Lemonis in what business are the employees actually buying the inventory . They have bills to pay. This business is in real trouble. How are you . Gary good. Lemonis im marcus. Gary im gary. Lemonis gary, nice to meet you. This is an unbelievable location. How long have you been here . Gary 41 years. Lemonis wow. And who started the business . Gary it was my dad. Lemonis and do you guys rent this property . Gary no, we own this property. Lemonis how much did you buy this property for . Gary way back when, it was 450,000, and i bought it from my dad for 600,000. Lemonis its a really nice building. Gary well, it didnt look quite like this, cause it burned down. Lemonis remind me a little bit when did this fire happen . Gary 4th of july, 2009. It was 100 loss. Lemonis and how much was the total loss . Gary over 1 million. Lemonis how much did the insurance pay . Gary about 1. 2 million. Lemonis so the loss was 1 million, but they paid 1. 2 million . Gary yeah. Lemonis okay. Do you mind if i come around . Gary oh, no. Youre welcome. Lemonis do you have a mortgage on the property . Gary i do. Lemonis how much is that payment a month . Gary about 3,800. Lemonis so, those people next door are your tenants . Gary yes. Lemonis how much do they pay . Gary 3,000 a month. Lemonis each one . Gary each one. Lemonis so you have 6,000 coming just from them . Gary yes. Lemonis so more than covers your mortgage . Gary more than covers it. Lemonis swansons monthly mortgage payment is 3,800, but the rent they collect from the two tenants is 3,000 each, so swansons, after they make their own Monthly Payment, will still clear 2,200 each month, totaling 26,400 each year. They actually make money on this deal. So, you have a bit of a kitchen here. Gary oh, yeah. Lemonis and whats the most profitable part of the business . Gary prep foods. Lemonis prepared foods . Gary yeah. Lemonis so how much fresh fish do you sell each week . Gary about 18,000. Lemonis 18,000 . What are the margins on that fish . Gary about 30 . Lemonis and then how much in soups and prepared foods do you sell a week . Gary its equal about 18,000. Lemonis and what are the margins on that . Gary thats about 60 . Lemonis double the margins . Gary yeah. Lemonis and what does it take to run this place a month . What does it cost between mortgage payment, utilities, payroll everything . Gary i would guess 18,000. Lemonis so, garys explained that he does 150,000 a month in business. I asked him what his margins are, and he told me 30 on fresh fish and 60 on prepared foods. Half and half is the business mix. If i take 45 , which is the average of the two, across 150,000 in revenue, thats 68,000 in Gross Profit Per month. He then tells me that his expenses are 18,000 a month. That would leave him with 50,000 in net profit at the end of the month. Theres almost 70,000 in gross profit, and the expenses are only 18,000. Gary no, that was you know what . Thats way off. Theres just a lot of expense thats associated with running the business. Lemonis so whats that . Like, give me an example. Gary those are loans, the mortgages, we borrowed money from people for construction, and i have vendors that i couldnt keep up with. Lemonis and is all that debt still outstanding . Gary yeah. Lemonis when im talking to gary about his numbers, what im kind of scratching my head on is hes making money. I can see the customers outside. I believe him on his margins cause i did some research. And so the numbers arent adding up to me. You know what id love to do, is taste the soup. Gary okay. Spence, you want to give marcus the soup tour . Spencer sure. Lemonis soup tour. How does this stuff sell . Spencer great. This is swansons family recipe. Lemonis so, what is this called . Spencer this is bouillabaisse. Lemonis this fish is amazing. Spencer yeah, thank you. Lemonis im a little disappointed that gary hasnt expanded his prepared foods. The margins are double what the fresh fish is. If he can just have what i call attachment attaching one preparedfood item to every fresh item that he sells his business should go up markedly pretty quick. How you doing, sir . Do you come here often . Man i do. Lemonis what do you get . Is there a specialty that you love . Man i love this coconut shrimp. The stuffed clams i cant make them at home as good as he makes them here. I just wish he did more prepared stuff. Id like to see the man open a restaurant. Lemonis will you come help us wait tables . Ill wait them with you. Man aw, i dont know. Ill come to eat. Lemonis okay. Nice meeting you. Man thank you. Lemonis is it always this busy . Gary yeah. Yeah. Well, this time of day, yeah. Larissa dad, can i get you to sign some of these checks for the vendors . Lemonis how are you . Im marcus. Larissa hi. Nice to meet you. Larissa. Im garys daughter. Lemonis and youre the one that reached out to me . Larissa yes. I was shocked. I didnt think you would call. Lemonis what prompted you to come here . Larissa well, all the stress. My mom was doing the books, and she was so overwhelmed that she didnt have any help, and neither did he, and. Lemonis you had another job . Larissa yeah, i was working retail. Lemonis was it a good job . Larissa yeah. I was getting paid well. Lemonis so you didnt really know what you were doing . Larissa not really, no. Lemonis and do you live close to here . Larissa no, i live an hour away. Lemonis you drive an hour each way . Larissa yeah, an hour each way every day. Lemonis why do you do it . Larissa my family keeps me going, and its hard watching people you care about struggle. Lemonis how is it working with your dad . Larissa its nice. Gary yeah, we get along fine. Her and her mom not so much. Larissa yeah, well argue who we should pay first this vendor, you know. Gary yeah, my wife will come in and yell at me and bitch, bitch, bitch, bitch, bitch, and i just leave. Lemonis yeah. Hi. Im marcus. Are you sue . Sue Marcus Lemonis nice to meet you. Sue oh i love it that youre here you dont know what weve been going through, marcus. Lemonis well, tell me about it. Sue gary can drive you nuts the way he does his books. You know, when theres not enough money here, hell pull it out of the realty, and then, you know, thats the tenants checks that are coming, you know. There are times that im like this. Lemonis and so, are you out of the financials now . Sue i want to be. Yeah. Lemonis but i thought your daughter did the books. Sue yeah, she just started. She could see it, you know, that i just dont have it in me anymore. Right now, we can only pay, like, one or two people a week, and thats it. Lemonis hows payroll getting made . Sue gary was able to put a few thousand dollars aside, and he made payroll last week. Lemonis its that tight . Sue marcus, im behind two months on my mortgage. Lemonis at home, you mean . Sue yeah. I get my verizon shut down every month. Lemonis the reality of it is, the situations bad. Sue oh, yeah. Lemonis right . Sue mmhmm. Lemonis the good news is, well figure it out, because what i know for sure is that i saw a lot of customers come through. This is an institution. We just have to figure out how to make money, okay . Sue yeah. Okay. Gary we have a beautiful office. Lemonis and so, this is all new . You built this building from scratch . Gary yeah. Lemonis after meeting with sue downstairs, im a little confused about the numbers now that shes passed them off to larissa. I want to get them all together so i can clearly understand what the numbers really are and what the Company Really needs. Gary i have a picture over here of what the old building looked like. Lemonis that ones, like, one you want to just take out of your memory. How did the fire start . Do you know . Gary they dont know. Lemonis what do you think . Larissa well, we had a fire in our warehouse. Lemonis so, wait a minute there was two fires . Larissa yes. Gary its hard to believe that it happened twice. Lemonis and how much did that fire cost you to rebuild . Gary i didnt track it, but i want to say 30 grand. Lemonis how much did the insurance give you . Gary think it was about 220,000. Lemonis and how much did it cost to rebuild here . Gary probably about a million dollars. Lemonis how much money did the insurance give you . Gary 1. 2 million. Lemonis with the warehouse, gary told me they received 220,000 from the Insurance Company, but it only cost him 30,000 to rebuild. With the main fish market, the swansons location, he received 1. 2 million from the Insurance Company, but it only cost him 1 million to rebuild. That means that he got an excess of 390,000 from the Insurance Company. Im a little confused why theyre in such trouble. Larissa, was it a total mess when you got here . Larissa oh, god. It was such a mess. Thats why i needed somebodys help with it. No one helped me. Sue i talked to you on the phone. Larissa no, you didnt. Lemonis sue, im kind of getting the feeling that you really kind of left larissa with the bag in trying to figure all of this out. I mean, shes a young girl. Sue yeah, no, no, not that bad as you might say. Larissa no, i was pretty much here alone every day trying to teach myself. Lemonis gary, do you feel like sue left larissa holding the bag . Gary yeah. Yeah, she has. Lemonis i mean, you want the business to survive, somebodys got to teach her how to do it instead of dumping it on somebody else. That, to me, is like holy crap. Larissa [ sighs ] im sorry. Lemonis what are you stressed about . Larissa just everything all the bills and everything thats been piling up. Its just so much. Ive been trying my hardest to help, and i just dont know how much more i can do, you know . Sue exactly. Why do you think im at home . Im dealing with the phone calls at home. Gary mm. No, youre not. Sue yes, i am. Persuade them, you know, to work with us. Thats what im doing. Lemonis sue, look, its clear to me that you need to take more of an active role in the business. Are you able to be here on a daily basis to take some of this burden off larissa . Sue yes. Lemonis the fact that i cant analyze these numbers the way i normally do makes me very uncomfortable. So, i tell you what id like to start with, is understanding this whole universe of debt. And so do you have that on a spreadsheet . So, taxes, i. R. S. 33,000 . Larissa yes. Lemonis kas mortgage 345,000 on the building . Gary correct. Lemonis im a little confused how a business that got a fresh start after receiving insurance money can be in such debt. They owe their vendors 187,000, taxes 67,000, credit cards 30,000, utilities and services 44,000, and all mortgages at 595,000, totaling 923,000 in debt from a company that got a fresh start just a few years ago. How do you guys pay the bills at home . How are you surviving . Gary i will take money out of the deposits. I will take money, cash out, and give it to her to go to the store. Lemonis and sue was telling me downstairs that one of the things she struggled with is you were pulling from this fund and pulling from that fund. Gary yeah. Sometimes that would happen. And a lot of these expenses are just household expenses. Lemonis gary, so you told me that your mortgage is really past due, as well. Gary at home, yeah. Lemonis is your mortgage paid here . Gary yes. Were in good shape. Lemonis what kind of car do you drive . Sue the bmw. Lemonis well, where do you get the money to pay it . Sue well, i. Lemonis out of the company . Sue yeah. Lemonis you owe your creditcard providers, you owe your vendors. You have a mortgage thats past due. You cant pay your employees on time. The employees are having to pay for fish themselves. Driving a bmw may not be a deal breaker as it relates to their finances, but its a deal breaker as it relates to sending a message and leading by example. It just isnt right. Do you have a profitandloss statement for the business . Larissa oh, yeah. Right here. Lemonis so, 1. 8 million in total business . And the business, on paper, made 148,000. Gary on paper. Lemonis and so, what it doesnt account for is any money that left the business to pay debt. From what i can see, swansons has a lot of business, and they actually make a decent profit, but between paying their mounting creditcard debt and sticking their hand in the till, that paper profit is really a cash loss of hundreds of thousands. This is a 40yearold family business. Its a long time. Its a lot of history. Its a lot a fish. Its a lot of customers. Its a lot of memories. And those are to be taken very seriously. The struggle that i have is, the numbers are fuzzy to me. And with the numbers being as fuzzy as they are, no investor particularly me is gonna invest in a business that isnt cleaned up. Im not rolling the dice. This is not a parlay game. Im not gonna continue to just hope that it works out, because we havent demonstrated as a collective group that we can manage money very well. Its too dangerous. Its russian roulette. Gary well, then were wasting our time. Then theres nothing we can do. Lemonis or you have the option you sell the building. And so my offer is im willing to put 1 million up to buy the building. Which allows all of your debt to get paid off, own 100 of the business, and put working capital in the business and not have to lose sleep at night. Gary i dont want to sell the building. Giving up the building would be a mistake. Lemonis how much is the Monthly Payment . I feel like youre offended by me asking the question. Im kind of annoyed that youre offended. If you dont want the million dollars, sue, just tell me, and you guys can figure it out. neighbor yeah, so were just bringing your son home. dad ah greetings, neighbor. Neighbor boy. He really loves our wireless directv receiver. dad he should know better. Were settlers. We settle for cable. But let us repay you for your troubles. Fresh milk for the journey home . neighbor we live right there. dad salted meats . neighbor no thank you. dad hats then vo dont be a settler, get a 100 reward card when you switch to directv. Whewhat does it look like . Ss, is it becoming a better professor by being a more adventurous student . Is it one day giving your daughter the opportunity she deserves . Is it finally witnessing all the artistic wonders of the Natural World . Whatever your definition of success is, helping you pursue it, is ours. Tiaa. Lemonis im willing to put 1 million up to buy the building. Gary i dont want to sell the building. Giving up the building would be a mistake. And 1 million might not be the right number. Maybe its worth 1. 6 million. That wouldnt be a good deal. Lemonis and let me tell you how i arrived at that. 1 million, coincidentally, happens to clean every bill you have up and put working capital in your business. Gary but then we no longer have this future investment. Sue thats our security. Gary cant do it. Lemonis and if you had the ability to buy it back at a future date . Gary okay, well, you have my attention with that. Lemonis okay, at some point in the future, if you are able to save money from your profitable business or you decided to sell your business, you can then come back to me and buy the building back. I dont know how that doesnt seem reasonable. Gary well, now that youre saying that theres an opportunity to buy it back, i would be interested in that. Lemonis so, is that a deal . Gary yeah. Lemonis okay. Gary thanks. When do we do all this . Do we lemonis well. Gary oh, boy. Sue [ sighs ] lemonis 1 million. Gary give it to larissa. Larissa ohh [ laughs ] lemonis when i normally write a check, i allow the Business Owner to deposit that money right into their account for operations or equity. In this case, the check that im writing is gonna go into escrow. When the attorneys have confirmed that everythings clear, the money will be dispersed. Itll go to the banks first, the vendors second, and whatevers left after everybodys paid will then go into the business. That ensures that theres no issues no fuzzy math, no questions, no risk. Sue knew she was supposed to be here today . Larissa yeah. Gary i dont know. Lemonis shes not answering . Gary shes not answering. Lemonis [ sighs ] so, guys, i wanted to get everybody together to kind of tell you last night, gary and i made a deal for me to buy this building for 1 million. Im not buying it to make a realestate investment. Im buying it to give gary an opportunity to get the business back on its feet. And so im gonna bust everybodys fanny to make sure that were successful. So, when we go through this process, im 100 in charge. What i say goes. And so, were gonna look at people, process, and product. I think the process is broken. When i find out that you guys are taking money out of your own pockets to make sure theres fish there, thats a broken process. When i found out that customers want prepared foods and we dont have them, thats a broken process. And so we obviously want to study this case, study the square footage, and figure out ways to make every square inch of this place more profitable. In swansons fish market, their cases make up 54 square feet of space 18x3. I now believe that i can take 54 square feet of space and double the revenue. The prepared foods have a 60 margin, versus the fresh fish at 30 , and so i know that if i can take the products that are in the current case and cook it, grill it, boil it, season it do all the things to it and make them prepared foods, we can go from doing 150,000 a month in sales to well over 200,000. What can we do to get more in their basket and more through the register . Hi, sue. Sue hi. How are you . Lemonis good. Sue good. Lemonis do you want to go ahead and join us . Sue yes. Lemonis sue committed that she was gonna be more excited and more involved in the business, right . And shes gonna do whatever it takes to make sure that were successful. Youre committed, right . Sue oh, yes. Ill be larissas backbone. I will guide her every step of the way. Definitely. Lemonis 41 years this business has been here. Its our job to make sure that it doesnt go away. All right, lets get to work. Thanks, guys. Gary thanks. Thank you. Gary okay. Well, yeah, its all right. What well do is ill talk to you guys in the next day or so. Nelson all right, thank you, gary. Gary all right, bye. Lemonis whats that about . Gary black rock cafe theyre falling behind on the payments. Lemonis the people next door . Gary yeah. Lemonis how much is that . Gary around 15 grand. Lemonis boy, thats a lot of money. Wheres all the paperwork . Gary i have it. Lemonis and whos joseph . Gary hes the money guy. He told me theyre not making it. Lemonis theyre not gonna make it . Gary no. Doesnt look good. Lemonis the situation at black rock is bleak. They opened up a couple months ago, and already, theyre 15,000 past due on the combination of rent and equipment. It looks like theyre ignoring their financial obligations. Gary he has the money. I think hes made a decision to not put anything more into the business. Lemonis so hes personally guaranteed this . Gary yeah. Lemonis the owner of black rock cafe has a 75,000 personal guarantee on this equipment and the lease. What that means is that we can go collect on his personal assets. I dont want to do that. What i actually want to do is come up with a solution that works for black rock and works for swansons. Well, if they cant pay, then what about the possibility of turning that into, like, a swansons grill . Maybe its a way to sell more fish, get better prices. Gary yeah, that might be a great idea. Lemonis swansons should have a restaurant, and black rock, the way it exists today, isnt a viable business, so i feel like i could fix both situations with one meeting. Why dont we maybe see if we can get together with them, okay . Where is sue, by the way . Larissa shes on her way. Gary yeah, shes always late. Lemonis im annoyed that sue continues to come late. Shes trying to convince me that shes committed to the business. Shes not committed to the business. Shes committed to herself. Gary aha. Finally. Sue morning, marcus how are you . Lemonis good afternoon. Gary good afternoon. Sue [ laughs ] lemonis you told me you were all in this business. Did something change . Sue no. Lemonis i got here early thinking you were gonna be here, and so im just if youre not gonna be engaged, i just need to get that around my head. Sue no. Lets move forward. Lemonis i feel like these guys are doing all of this by themselves. Am i missing something . Am i just wrong about how im seeing it . Are you able to get rid of your car to lower that payment . Can you change to a different car . Sue [ chuckling ] here we go again. Lemonis how much is the Monthly Payment . Gary is it 500 . Lemonis its 500 . Sue yes. Lemonis i feel like youre offended by me asking the question. Im kind of annoyed that youre offended. If you dont want the million dollars, sue, just tell me, and you guys can figure it out. It does send a bad message when your employees downstairs are taking money out of their pocket to buy the fish and youre driving a bmw, right . Gary yeah, no, youre right. Lemonis am i thinking about it the wrong way . Lemonis can you agree with that . Larissa i agree with you 100 . Lemonis and so, you dont agree with that, sue . Sue that. . Lemonis it sends a bad message . Sue but that started happening afti was driving it. It didnt happen before. So. Larissa it is upsetting that you have kind of abandoned the whole thing and put this all on me and dont feel bad about it. Sue larissa, when youre in here, are people calling . Larissa im here all day every day. Im dealing with everyone coming in and out of that door all day. Sue and its very stressful, yes. Larissa people looking for checks they didnt get paid last week. Sue and then we bounced two checks this week. Larissa i know about all of that. Sue i dont know if youre aware about it. Larissa im here five, six days out of the week. Sue okay. Because obviously larissa its my routine every day coming here. Sue obviously, im not larissa i drive an hour every day to get here from branford. I dont know why i made everyones problemy problems. [ voice breaking ] sorry. Im getting emotional. Ive just been through a lot trying to help everyone. And i just dont know how much more i can do. Like, its just. Sue oh, no. Larissa i try to be strong for everyone, but. Sue ohhh. Youre doing a fine job. Youre doing great. [ smooches ] mommy loves you. No, you are. Youre doing good. But no, working here larissa, the amount of i know. I know the amount of stress. Larissa i dont really have anything else to talk about now. This is just a lost cause. [ sighing ] i just. Lemonis you guys are 15,000 behind. In the real world, if you dont pay your rent, the door gets locked and everything inside becomes his property. This just got interesting. Why pause to take a pill . Or stop to find a bathroom . Cialis for daily use is approved to treat both erectile dysfunction and the urinary symptoms of bph, like needing to go frequently, day or night. Tell your doctor about all your medical conditions and medicines, and ask if your heart is healthy enough for sex do not take cialis if you take nitrates for chest pain, or adempas for pulmonary hypertension, as it may cause an unsafe drop in blood pressure. Do not drink alcohol in excess. Side effects may include headache, upset stomach, delayed backache or muscle ache. To avoid longterm injury, get medical help right away for an erection lasting more than four hours. If you have any sudden decrease or loss in hearing or vision, or any symptoms of an allergic reaction, stop taking cialis and get medical help right away. Ask your doctor about cialis and a 200 savings card stop taking cialis and get medical help right away. I. Just me. Me andrd my four daughters. Ah, theres a lot of dancing and pageants that go on in our kitchens and living rooms and things like that. Ive had to learn to accept certain things like the fact that my toe nails and finger nails are going to be painted constantly. But its really awesome to watch them at their own things. Theyre great kids. All of them. Whatever home means to you, well help you find it. Zillow. What aremaking a cake ht now . Ayla reminds me of like a master chef and emiana reminds me of like a monster chef. Uh oh. I dont see cake, i just see mess. Its like awful. It feels like i am not actually cleaning it up whats that make mommy do . doorbell whats that . Swiffer wetjet. So much stuff coming up. This is amazing woah. Wow. Now i feel more like making a mess is part of growing up. Stop cleaning. Start swiffering. Lemonis black rocks situation looks really bad, and theyve pretty much given up on honoring their financial obligations. Secondly, gary really needs to expand his business in the preparedfoods market. So im looking to come up with a solution that not only gets gary his restaurant back, but lets black rock off the hook. Nelson gary. Hows it going . Lemonis how you doing, sir . Im marcus. Joe marcus. Joe. Nice to meet you. Lemonis nice to meet you, joe. Right now, the business is struggling. Youre a few months in, and youre already 15,000 behind. Joe i understand i mean, i have other business interests, as well, so its kind of tough. Lemonis you have 75,000 on the hook, and you have a lease. Do you have the money to take care of this guarantee . Joe i could pay it, but its a question of do i want to go into my retirement account and start liquidating . Lemonis and honestly, i dont want you to do that. And so were giving you a lifeline. Were suggesting that, for a very nominal amount, your personal guarantee is gone, all the liability would go away. Yes, you would take your losses on everything youve put in thus far, but it at least stops the bleeding. Nelson so, what is that nominal amount that youre talking about . Lemonis 10,000. Thatd be probably it. This is a nobrainer. Anytime somebody allows you to get off the hook for 10 grand on a 75,000 obligation, it seems like theres not much to think about. This restaurant would become part of garys business. You would become kind of the chef for the swansons team. Wed be making prepared foods here. And everybody keeps their job. This gives the opportunity for the employees of black rock to keep working and for gary to sell more fish. Seems like a winwin to me for everybody. Joe we had a little bit of hiccups with opening this up. That kind of put us behind the eight ball. So im okay with walking away. Nelson we are gonna go ahead and do the deal. Lemonis i see this as a really good opportunity. Gary yeah, this could be a great success. Lemonis its going to be a great success. Im glad the deals done. Well see you guys tomorrow. Nelson marcus, thank you. Lemonis thanks, guys. You had put together a spreadsheet of everything we owe. Is this it . Larissa yes. Lemonis so, heres what i want to do, gary. I want to start calling some of these vendors right now. What i want you to remember is youre getting a set amount of money from me. And so the less that you can have leave, the better. And so im looking for you to negotiate as best you can. Larissa with everyone. Lemonis . With every single person. Lets start with vals. I want you to call them and offer them 35,000. Larissa okay. Lemonis we owe a lot of money to our vendors almost 200,000. One of those vendors, vals, that supplies our fish, we owe 53,000 to. We need to negotiate these down. And quite frankly, im assuming that most of these vendors will be happy to hear from us cause getting something is better than nothing. Larissa hi. This is larissa from swansons fish market. I just wanted to see what our Outstanding Balance was with you. Man its 53,000. Larissa okay. How would you like to meet me at 35,000 . Man thatd be a bit much after all this time. I couldnt go below 40,000. Larissa all we have is 35,000. I mean, were just were trying to, you know, get our pennies together and just pay off as much as we can, but thats all we could really do. Lemonis today. Larissa i would write a check for you today. Man certified check . Larissa certified check. Man all right 35,000. Larissa okay, thank you. Thank you so much. Lemonis how much did you just get off . Larissa i think 20,000. Lemonis 20,000 . Youre 20,000 closer to buying your building back. Larissa mmhmm. Lemonis you did a great job, by the way. Kickass. Larissa thank you. Lemonis so keep going. As i go through the case, talk me through what logic you have when putting stuff in certain places. Spencer i actually kind of try to keep it colorcoordinated somewhat. Lemonis whats the numberone mostpopularselling item . Spencer salmon. Lemonis okay, where is that . Spencer its right here. Lemonis right in the middle. You know when you go into a grocery store, where do they put the milk and the bread . Spencer in the back. Lemonis right. And so the sides are your back. And so the things that you sell every day, all the time you dont even have to work at it should go on the ends. And then the highestmargin stuff in the middle. cause this is what people are gonna look at first. So what i want to start doing is moving some stuff around. Spencer okay. Lemonis im gonna go through that case and make sure that every square inch has product that we can sell, its presented properly, and it now has room for prepared foods. That was down there. This is now here. Gary yeah. I mean, it looks great. Sue all right, come on. How is it that you can have a boat and get away with it and hes up my ass about the bmw . You know how i feel. Its a good car and how i feel safe driving it. So, now im wondering if. What do you think about getting rid of the boat where i dont have to get rid of my car . What does it actually cost you to put that boat in the marina . Without repairs, 5,000 a year. Gary you want the car cause you want the car. Sue i dont want to find out that im gonna have to drive around in a smart car while you have the freaking boat thats been nothing but an expense, and ive been after you to sell it. Gary its the only hobby i really have. Sue its ridiculous gary to you, it is. You know what . You, it is. Sue the amount of money 2,000 minimum. Gary i work for it. Sue a waste of money, that boat. Youve had it. Ive asked you year after year gary so was the bmw. Sue [bleep] the bmw, okay . Gary blah, blah, blah. Sue [bleep] sick of it. Lemonis hey, guys. What are we talking about . Gary well, she wants to keep her bmw, so i should sell my boat. Lemonis i didnt know you had a boat. Gary yeah. Lemonis so, you didnt want me to see it . 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Hmmm. And equipment for two child seats. Hmmm. For those who take safety seriously. Like we do. The Volkswagen Safety in numbers event. Is happening w get a 1,250 volkswagen reward card and 0 apr on new 2016 passat models. As long as you love me, its alright bend me shape me, any way you want me. Shape the best sleep of your life. Sleep number beds with Sleepiq Technology adjust any way you want it. The bed that moves you. Only at a sleep number store. Lemonis i didnt know you had a boat. Gary yeah. Lemonis so, you didnt want me to see it . Gary yeah, it wouldnt send a good message. Lemonis to who . Gary to anyone and everyone and you. Lemonis everybody else knows you have a boat, so that feels a little funky to me that you didnt feel like you could just be honest with me about it. The fact that im hearing that gary has a boat is outrageous information, and im not gonna lie to you it pissed me off. The fact is that he didnt want me to see it, and that bothers me more than the fact that he has the boat. Gary the boat got swamped in a hurricane, and it got bought out by the insurance. I got a 70,000 check probably double the value of the boat. It hasnt been a huge expense. Sue minimum 5 grand for the season. Minimum. At least i use the car for business reasons, okay . Lemonis do you deliver fish with it . Sue yeah, ive picked up shrimp and whatever. Gary no. You dont really do that. Lemonis the reality of it is is that im writing a check so that you guys can get stuff refinanced. Your employees are taking money out of their pocket. You could see to the outsider how a boat and a bmw looks a little. Sue, can you see how somebody would look at that or no . The bmw and the boat have to go, so i think thats. One of the ways i can make swansons more profitable is by taking their existing space and getting more out of it. Whats in here . Paul nothing. Lemonis ugh it smells. Were not utilizing the space properly. Im taking the old equipment out that was broken, and im bringing in new refrigeration. Thats fine. I went out and spent 17,000 to buy new equipment that allows for great presentation of prepared foods. Anything thats in that kind of container ready to roll prepared. Spencer okay. Lemonis salads premade boom. Soups prepackaged done. Nelsons next door preparing a number of different recipes that were gonna sell at swansons grill, as well as in the preparedfood cases. Did you taste that . Gary yeah, i did. Im gonna taste it again. This is delicious. Lemonis im also adding Fresh Produce in the store cause customers may want to buy some vegetables to go along with their fish, increasing the amount they spend per visit. In the past, swansons was nothing more than a freshfish market. Now you can buy prepared foods, you can buy produce, you can buy lunch or dinner next door, you can buy soup to go, both fresh and frozen lots of different options. All of thats gonna double the business here. Ive spent over five days at swansons spread out over four weeks, and im finally back to see what sort of progress theyve made. The first thing i see when i get there, is sue rolling up in her bmw, and whats worse, its 12 00. Thats not my definition of commitment, and thats not gonna fly. Hey, sue. I guess the first thing for me, really, is when you say, im gonna help you, im gonna be your backbone, you have to actually be that backbone. It doesnt look good that you show up late, it doesnt look good that youre driving the bmw. Can you see my point at all . Sue oh, marcus, i dont feel like doing this. Okay, marcus . Lemonis what do you mean, okay . Youre asking these guys at the front to show up and take money out of their pocket and buy the shrimp and buy the fish, and you got a 500, 600 car payment. And so when things get tough, you make sacrifices. You dont put yourself in front of the employees. Sue yeah, no, ive already explained it to you. I dont feel like going over it again. Lemonis you cannot be driving a luxury car. Hey, sue. Sue i am not gonna get into any more discussions about the bmw. Im done. I am [bleep] done. Lemonis i mean, i just dont understand why you think its okay. Sue one more time, and i swear to you, i am gonna punch somebody in the face if they mention the bmw again. Larissa mom no, seriously lemonis seriously, what . Sue i am sick of it of constantly being reminded or being reprimanded about this. Lemonis well, if youre not gonna give me the courtesy of discussing this, then we have no deal. Because i didnt put my money down into a business so that you could do what you want. Your daughters driving a car thats older thyou, and shes doing all the work. Be committed to your family. Sue i am. Lemonis no, youre not. Youre showing up late. Sue i had a contractor at the house and the painters showed up. Lemonis did sue just tell me that theres contractors at their house . Remodeling . Painters . Bmws . Boats . Were here trying to build a business. Theyre out rebuilding their house . How am i supposed to do business with people that arent transparent . Meeting with the painters more important than being here with me . If it is, no problem. Maybe the painter will give you a million dollars. Look, if you have nothing to say, then i should just go. Im sure you have some plan, cause you dont seem to be concerned about paying me back. So strap yourselves in for action flo Small Business edition. Oh, no im up to my neck in operating costs ill save the day for plumbers and bakers and scapers of lawn, shes got insurance savvy you can count on. You chipped my birdbath now youre gonna pay not so fast i cover more than just cars and trucks. Action flo did somebody say insurance . Children flo action flo cut can i get a smoothie, please . Ooh they got smoothies . For me. 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If your pill isnt giving you the control you need ask your doctor about noninsulin victoza®. Its covered by most health plans. More sit per roll. More stay per roll. More whos training who per roll. Bounty is two times more absorbent. So one roll of bounty can last longer than those bargain brands. So you get more life per roll. Bounty. The longlasting quicker picker upper. And try bounty napkins. Im sure you have some plan, look, if you have nothing to say, then i should just go. cause you dont seem to be concerned about paying me back. Larissa i know youre upset, but look at this opportunity. Why are you getting so angry . Hes doing us a huge favor. You just, like, screamed at him. You should be grateful. Dont you understand that . You just got to suck it up. Like, he might back out on us, and i wouldnt be surprised. [ sighs ] lemonis gary and sue called me here to help them fix their business. They told me they were in dire straits. But im learning that theyre living a lifestyle that people that are in dire straits dont live. So im going to town hall to find out if theres anything else i dont know. Woman good morning. May i help you . Lemonis id like to look up some public records. Woman sure. Come on over. Lemonis okay. The clerk gave me access to the computer, which allowed me to see all the records on garys realty since 1990. I cant believe what im learning. The swansons are actually in foreclosure right now. While im spending all this time and money getting prepared to buy the building. This started back in 2012. The bank is getting prepared to take the building back. The representations that gary and sue gave me regarding their building theyre not accurate. This foreclosure action gives me a reason to not want to do the deal. Now i feel like i need to confront gary. Im tired of his misrepresentations and, quite frankly, im tired of his lies. Over the time that weve been together, ive had to go fishing for information. Ive had to learn things on my own. Things have come to light. You hid a boat from me. Gary i didnt hide the boat from you. Lemonis you told me that downstairs you told me you didnt want me to know. Gary i didnt waanyone to know. Lemonis you got paid 75,000 from the Insurance Company. You told me the money nt into the business. Gary yes, it did. Lemonis okay. And so im watching all these trails of money come from the Insurance Company and go into your business, and i can see the business is thriving downstairs. Where is the money from all those people that are buying . Gary i think we explained that. Lemonis explain it again gary some of the cash goes for. Lemonis personal bills. Gary yeah. Weve got to pay lemonis just like the insurance claims. Gary yeah. Lemonis then when i go to buy a piece of property, i decided to run a title search. Gary right. Lemonis first thing that comes up is a lien. The second thing i have is a foreclosure action. Gary from kasowitz mortgage. Lemonis you never told me about this. Gary [bleep] i didnt. Lemonis [bleep] when . Gary you sat here at this desk when we called that guy up and told him well pay him tomorrow. Lemonis but you didnt tell me that he was foreclosing. The foreclosure action started before i even got here which means that documents were sent here notifying you that the foreclosure process was started. Sue we didnt see that. Where are they . Whewhat does it look like . Ss, is it becoming a better professor by being a more adventurous student . Is it one day giving your daughter the opportunity she deserves . Is it finally witnessing all the artistic wonders of the Natural World . Whatever your definition of success is, helping you pursue it, is ours. Tiaa. So we know how to cover almost alanything. Thing, even turkey jerks. [turkey] gobble. [butcher] im sorry burke covered march fourth,2014. Talk to farmers. Weve seen almost everything, so we know how to cover almost anything. We are farmers. Bumpadum, bumbumbumbum this bale of hay almost derailed the ranch. When a wildfire raged through elkhorn ranch, the sudden loss of pasture became a serious problem for a family business. Faced with horses that needed feeding the owners were forced to place an emergency order of hay. Thankfully, mary miller banks with chase for business. And with a complete view of her finances, she could control her cash flow, and keep the ranch running. Chase for business. So you can own it. neighbor yeah, so were just bringing your son home. dad ah greetings, neighbor. Chaneighbor boy. Ss. He really loves our wireless directv receiver. dad he should know better. Were settlers. We settle for cable. But let us repay you for your troubles. Fresh milk for the journey home . neighbor we live right there. dad salted meats . neighbor no thank you. dad hats then vo dont be a settler, get a 100 reward card when you switch to directv. Free wifi is nice but also risky. An open network isnt encrypted, which means your personal information isnt safe. Movie times . Great. Online banking . Use a secure network. Protect yourself from prying eyes. The more you know. Protect yourself from prying eyes. Lemonis the foreclosure action started before i even got here the documents show it. You guys have lied to me. Gary [bleep] we did [bleep] we did. Lemonis gary, how come i didnt know about this . Gary how come we didnt know about it . Lemonis how am i supposed to know . Gary we were behind a payment. Lemonis the guy cant foreclose if youre behind a payment. Gary and he hasnt foreclosed. Lemonis yes, he has. This is entered in the court. I got this from the city hall. Gary and you stood here and said we were gonna pay him off. Lemonis thats because i ran a title search and i found [bleep] that you didnt tell me about gary then why didnt you do the [bleep] search first . Why didnt you do the goddamn search before . Lemonis because i took you at your word. Gary [bleep] lemonis i dont negotiate with people and run background checks on them. Gary [bleep] lemonis [bleep] my ass. Gary yeah, get the [bleep] out. Lemonis the deals off. Sue marcus gary get the [bleep] out. Sue marcus. Lemonis you know, i do business on handshakes, and i try to help people, and i do it to make money. There are a lot of struggling businesses out there not because theyre taking money out of the till, not because theyre spending it on lavish things that they shouldnt have, but because they genuinely are struggling. Not all of them get my money, and not all of them get my time, but this one didnt deserve either. They just flatout lied. Is your mortgage paid here . Gary yes. Were in good shape. Lemonis for that reason, im out. man the sharks are back. Theyre looking for the best products and businesses america has to offer. And tonight, guest shark lori greiner joins the tank. I can tell instantly if its a hero or a zero. Hopeful entrepreneurs come to the shark tank seeking an investment to start, grow, or save their businesses. What sales do you have . Weve hit over 5 million. sharks whoa if the sharks hear a great idea, theyre ready to invest. I have an offer for you. Using their own money. Its called taking a chance. And fight each other for a piece of the action. I dont want to do business with kevin. Doesnt matter whyou want. Its not your business. chanting shark fight. Shark fight. But first, the entrepreneurs must convince a shark to invest the full amount theyre asking for or theyll walk away with nothing. Are you willing to go closer