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tv   The Profit  CNBC  February 27, 2021 5:00am-6:00am EST

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overspending on a retinol cream? just one jar of olay retinol24 hydrates better than the $100 retinol cream. for smooth, bright skin or your money back. olay. face anything. and try new retinol24 max. lemonis: people ask me all the time, like, "tell me the top five episodes that you love," and i always say to them, "to make or to watch?" i would say that "eco-me" is definitely one of the bottom 5 in terms of enjoyable to make. but there's some good lessons in here. eco-me is one of the countless businesses that i visited during "the profit." let's go make some money. [ horn honking ] i've traveled the country trying to fix the people. and you do a million dollars a year. man: yeah, but we don't know how to keep any of it. lemonis: ...fix the process... see? it is flimsy. don't ever make these again. you don't sell them. ...and create a few products. woman: it reduces anxiety and depression. lemonis: i kind of like that. but we can't always fit everything i'm thinking into the show. so tonight, i'm gonna give you an inside look
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at an episode from season one, "eco-me." without me, this business doesn't make it. over the next hour, i'm gonna take you deeper than we've ever gone before... i'm willing to offer $500,000. robin: that is an awful deal. you're crazy. lemonis: if you brought me this business today, how long would we last? amber: not even a whole day. lemonis: ...and take you behind the scenes to see how a struggling consumer products company... i'm not willing to do the deal if you're in charge of sales. i don't think jenn knew how to be a salesperson. i'm not good at basketball. i'm not offended by it. ...navigates through a competitive landscape. the product itself -- i think it's terrible. robin: i'm really freaking out right now. lemonis: my name is marcus lemonis, and this is an inside look at "the profit." part of the reason why i picked this particular episode to do an inside look is that i wanted to show people how difficult it is to navigate with a consumer product company. i think there's a lot of lessons here that we can all take advantage of. eco-me is an all-natural cleaning product started by robin kay levine in 2006.
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with the partnership of her childhood friend jenn mihajlov, they built eco-me up from a small do-it-yourself cleaning kit to a 17-piece cleaning line, and they're nearly a half a million dollars in debt. if they don't turn around their finances, they're gonna have to close their doors, and all their workers will be out of jobs. hi. how are you? where do i find robin and jenn? raul: right through this door. lemonis: are you robin? robin: i'm robin. lemonis: robin, i'm marcus. robin: very nice to meet you. lemonis: nice to meet you, too. you guys have this place branded well. robin: thanks. oh, this is jenn. lemonis: hey, jenn. marcus. jenn: hi. nice to meet you. lemonis: so is this pretty much -- robin: well, this is the front office. this is my office, and when jenn comes into town, 'cause she's based out of the east coast, she works in here also. amber: is that hard to have jenn, her sales force, be in a different state? or does not not matter if they're doing it properly? lemonis: it's hard to answer that in the environment that we're living in because people have learned how to work remotely. amber: this was 2013. lemonis: yeah, back then, i didn't like the idea
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of people working at home, but as we fast-forward 7 years later, with technology, the ability to work remotely is dramatically different than it's ever been before, particularly when you're in the sales organization. robin: so in 2005, my sister was diagnosed with breast cancer. i went back to be with my family and help my sister through her treatments, and i was just opening up that cabinet under the sink, and i'm just staring at all the chemical stuff and the smell of it, and i said, "oh, my god, i can't clean with this stuff. i don't want her to continue to get sicker." and i went and i got vinegar, baking soda, olive oil. i googled, like, how to make your own stuff, what to do. and that just really started a snowball. and i totally pulled jenn in. "i've never done sales and marketing. but that's your background. you have to come with me." lemonis: so you oversee sales? jenn: yes. so i went. robin: so she went. jenn: and that was it. i was hooked. robin: she was hooked. lemonis: robin, so this isn't really just about the products on the shelf for you, is it? robin: no, no. jenn: no. lemonis: i love the fact that she has purpose, she really understands her business, and she's very much about conviction with the decisions that she makes.
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i give her a lot of credit for having conviction. you guys have a lot of your own money in the business? robin: yeah. lemonis: how much debt in total exists today, if you were just rough-balling it? robin: well, close to $500,000. lemonis: wow. robin: last year was the year i was supposed to get paid, and it didn't happen, and it's incredibly hard for me feeling the responsibility to pull any money from the company when i know that i haven't paid people that are working and following my lead. lemonis: you really do wish that more business owners thought that way. she thought it was important to have inventory. she thought it was important to take care of her people. they're supposed to get paid before everybody else gets paid. when's the last time you got paid? jenn: it varies, but even if -- robin: we're back to november still, with you, though. jenn: yeah. yeah. lemonis: what's your biggest fear? jenn: that this company won't survive. lemonis: if you don't raise money, is that a possibility? robin: yeah, it's always a possibility. lemonis: so i'd like to learn a little bit more about the product. robin: it's just vinegar, water, a little solublizer, and our essential oils. lemonis: i did think it was interesting, and i'm surprised i didn't address it then,
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that when she made the formula really simple, what was missing was something proprietary. what is the barrier to entry that prevents anybody else from getting into that business? and as i look at investing in episodes later in the series, i really wanted to make sure that i was investing in things that had some sort of proprietary formula around it. robin: each of the products has a name. for instance, where they pick up a floor cleaner, it says dave, and they say, "oh, my grandfather's name was dave." lemonis: oh, my gosh. this makes me crazy to watch this today. robin: so it really is catchy, and it sticks with the consumer. lemonis: so the name of the product is emma or eco-me or...? robin: so the story is that there is an emma, and these are all named after our friends and family. lemonis: what is the actual truth? is there an emma? robin: there is an emma. lemonis: the product itself is good. it has good purpose, a good mission, and it works. but as a business guy, it -- it's really -- i'm struggling with this. i think it's terrible. you got to have a brand -- not kate, jack, emma, dave. it's just too much. make sense?
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robin: we don't want to be like everybody else. this brand is very personal to me, and it was built on our friends and family, and in the marketplace, people know emma, they know bill. lemonis: that's what's called pride of authorship. and it's one of the biggest mistakes that a business owner can make, is not taking that information and listening as opposed to just saying, "stop. this is what i believe in, and this is why i did it, and if you don't like it, don't invest or don't buy the product." what matters is what's inside. robin: what matters is what the customer sees on the shelf. lemonis: well, the customer's not buying much of it. robin: i know you have your opinion, and i respect that, but i don't fully agree with it. lemonis: i'm cool with you arguing with me. but listen for a second. robin: this is our warehouse. we basically have drums that we do all our batching in. lemonis: should i think about this like a big recipe vat? joyce: absolutely. lemonis: adding ingredients like a mad scientist? joyce: yes. lemonis: okay. robin: but we're not mad. we're happy. lemonis: the fact that she thought it was a good idea to rent a warehouse, to try to mix things in her own drum,
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to try to package them together, when there's co-packers that are across the country that can take water, vinegar, and natural oils and put them in a bottle together and run thousands of bottles is beyond me. making it yourself is fine if you're selling it at a flea market or at a farmer's market. but if you want to sell it to big box retailers, they're gonna want to know that there is a certified process to make the product where it's always gonna be consistent. and there is a liability associated with that when you're making representations about the product. that is the reason to go to a co-packer. robin: this is a big plastic tote of castile soap, and it's one of the best castile soaps you can buy. lemonis: so, what's something like this cost? robin: what is a tote? joyce: four grand. lemonis: $4,000? joyce: yes. lemonis: how much production can you get out of this? joyce: just under five thousand units. robin: we don't have a ton of room here, so we're buying one tote at a time, where maybe we need four totes. lemonis: the reality of it was, is that robin was doing a great job rubbing two sticks together to make her business go -- very smart, very resourceful.
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my big problem -- she had to look at everybody else for the answers. i didn't like that early on, and i would never tolerate that today. space is one confinement for not having more of this. what's another confinement? jenn: we need more people. i mean, it's just a fact. robin: yeah, jenn is our sales team. lemonis: you don't need more people. in this particular model, if you find a co-packer, you're essentially going to have the product made by somebody else that will distribute the product. what this business ultimately needs is a sales organization. and if you don't have the resources to staff people internally, you can hire a broker or a rep firm that will actually take this to market for you. how are you? i'm marcus. raul: hi, marcus. my name's raul. nice to meet you. lemonis: nice to meet you veronica: veronica. lemonis: nice to meet you. so tell me about your process. raul: come get the bottles. lemonis: so we got a blank bottle. raul: then we take it to label it. these labels are probably too big. the roll's too long so it will not fit on the machine here. lemonis: what, are you rigging the thing? raul: yeah, because the roll's too big. lemonis: not only do you not have the automated machine, this machine doesn't even work for what you have.
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raul: right. lemonis: how long does this normally take? raul: on a good day we can probably get maybe 1,200 bottles. lemonis: this is the process. mike: very long, very tedious. lemonis: now let's see over here. what happens over here? raul: this is a filler machine. lemonis: take me through how this works. raul: have to turn on the machine. you set down on the floor. this is how we set the time for the fill. lemonis: it's a guess, isn't it? raul: until we get it accurate, yes. lemonis: these look full, but not really. they're a little short. raul: no, they'd be short. lemonis: so what does this need to weigh? raul: these should weigh about 35 ounces. see, that's -- that's over. so when it's over, what we would do -- pour it out. lemonis: now, you're still over. raul: i'm over. lemonis: in season one, i was probably more anxious about addressing a labor model and saying, "if you'd take this to a co-packer, you'd run a much better business," because that means that some of these folks would lose their job. i'm frustrated with myself that i didn't get right to the point. like, this is a bad process -- all this inefficiency of labor and time and materials.
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this isn't a manufacturing facility. this is like something in your garage. your role in the company is the sales. do you think it matters that you're not actually in california with the rest of the team? you're in new york. do you think that makes a difference? jenn: no. lemonis: no problem. jenn: no. lemonis: do you feel like you're good at sales? is this something that you feel like it's a strong suit of yours? jenn: yes, i do. when i go to do these shows and i'm talking to a buyer, i could pretty much hold any product in my hand and sell it. lemonis: are you freaked out a little bit right now with where the company's at financially? jenn: um, yeah. i mean, it's just been a tremendous roller coaster. it's just been very difficult. lemonis: so here's the good news -- i believe in the product. robin: okay. lemonis: i love the people that are here, but i think your process is terrible. i think you lack efficiency and equipment. you also need to sell more, so here's what i have in mind. number one, i want to get this company to $10 million in sales.
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number two, i want to be profitable in a very short period of time. robin: that sounds great. lemonis: i'm willing to offer $500,000 to help this business not only survive, but succeed. i'll finance the inventory. i'll finance whatever equipment we need for the warehouse. i will pay off the debt and fund working capital. but i want 20 percent of the business. robin: that is an awful deal. lemonis: for who? for me? robin: for us. no, you have a great deal. that's a great deal. you're crazy. so you're asking me to give up 20 percent of this company, give up everything that we've worked for. lemonis: you need money. robin: we do need money. lemonis: and you need help. robin: we do. but i would say $250,000 is easily worth 10 percent of the company. lemonis: how is it that somebody even today would think that a business that did a half a million dollars in sales doesn't make money, doesn't have a manufacturing process, and basically told me, "our formula's really easy. it's just water, vinegar, some solubles and essential oils," would put a value of $2.5 million -- is what she essentially said the business is worth. she wanted $250,000 for ten percent.
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robin: that gives you enough equity in the company so you feel secure that you're part of it. lemonis: so a company that does $500,000 a year in sales and loses $200,000 is worth $2.5 million to you? robin: the valuation of our company -- lemonis: i don't care about the valuation. you need money. robin: this is my child. this is my company. it's everything. lemonis: i appreciate how personal it is, but without my money, without my help, this business that you love -- it all will go away very fast. amber: i think you said you made mistakes, they made mistakes. i still don't know what your mistakes are here realistically. lemonis: coming to the business. amber: for real? that's your mistake? lemonis: my biggest mistake in this episode was staying in the business. if you brought me this business today and they acted the way they did, how long would we last there? amber: not even a whole day. lemonis: right. that's a mistake. i stayed. for the next week, i'm in charge. no! for the next week! on day eight, you do whatever the heck you want, and i'm good with it.
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lemonis: without my money, without my help, this business that you love -- it all will go away very fast. look, robin, i will do $250,000 in debt, and i will do $250,000 in equity for 20 percent. that's a total of $500,000. i'd like to clean that up a little bit because the way that i presented that offer to all of you
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was not how i would have presented today. i'm essentially willing to invest a half a million dollars, and i would split that half a million dollars with $250,000 going into equity with a $1,250,000 valuation and an additional $250,000 in the form of debt to allow the company to procure the necessary equipment it needed. there's no reason that i should have been investing $250,000 in equipment. i should have invested $25,000 to fly my ass somewhere to find a co-packer. robin: every inch of this business, every second from beginning to end, it's me, and when you say, like, "oh, can you give up control over something?" yeah, i can, but i don't want to. this business is in my blood, so if it doesn't make it, it's devastating. lemonis: we have a deal? robin: let's do it. lemonis: okay. the purpose of me being here is to help you fix the business, and for the next week i'm in charge. for the next week, i'm gonna hand you a half a million dollars and be in charge for a week.
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oh, yeah, and then on day eight, you do whatever the heck you want, and i'm good with it. yeah, no, that's not happening. robin: you can't fire any of my employees. lemonis: but when i tell somebody that i'm in control for a week and then they start backpedaling and telling me, "well, but you can't do this, and you can't do that, and you can't do this" -- robin: i just had -- lemonis: i know, and i'm saying no. robin: but we've just met. lemonis: but i'm just giving you $500,000, and i'm asking you to trust me after i told you i would trust you. robin: but i'm turning over my entire -- my child. lemonis: but for a week. but for a week. robin: you come in, not emotional -- it's not your baby yet -- and you say, "you know what? so-and-so might be better in a different position. and i don't know if we're ready for that position 'cause i might want to outsource that." lemonis: it's a business, robin. see, she even knew that doing the manufacturing internally was a problem because she said the word "outsource." why in the hell didn't i think of that? in that moment, i was so fixated on deflecting her request to not make changes and arguing over who is gonna be in charge for a week that i really didn't focus on the most important part
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of the business, which is improving the process. and i think she did an excellent job of head-faking me away from a co-packer by having me focus on not firing people 'cause what was i going to say? "yeah, i'm definitely gonna fire everybody"? there's ways to reallocate people to other areas of the business. that warehouse could have turned into a distribution facility, and the three people that worked there could have easily continued to work there. hear me out for a second, okay? for me to give you $500,000, that trust has to be really earned over a course of a week. but at the end of the week, if you don't do what you say you're gonna do and you don't follow through, my $500,000 and me will both evaporate. robin: okay. okay. lemonis: so make it out to eco-me? robin: eco-me. lemonis: we have a deal. robin: okay. lemonis: thank you. robin: wow. that's crazy. that's a real check. [ laughs ] lemonis: it's a very real check. robin: yeah.
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lemonis: the first thing i'm gonna do is get eco-me's equipment up to date. i'm taking robin and jenn down to accu-tech, one of the premier companies that produces bottling equipment. man: so this is the machine. this is the same type of head right now that i think you have. robin: yep. man: this is a neck grabber. what it does -- it ensures that the bottleneck is centered to the nozzle, so you don't accidentally crash in between bottles. robin: right. okay. man: you could do 60, 70 a minute on this without even thinking about it. lemonis: so where do the labels go on? man: after the bottle's been capped, we'll send one through here, and then it's gonna travel down here through the labeling machine, and that will -- let me catch it. robin: oh, my god, lemonis: oh, that was awesome! equipment like that really will help solve a problem. but at the end of the day, a co-packer is the real solution here. and this was misstep number one on my part. we need more business like yesterday. robin: yeah. lemonis: we better sell more. and if you don't, i'm gonna find somebody who can,
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'cause this $180,000 machine's going to require us to sell about $4 million or $5 million dollars immediately just to make this thing make sense. thank you very much. man: great. robin: everything is coded and dated. lemonis: how are you? robin: good. how are you? lemonis: this is connie and kelly. they're my two lead buyers. jenn: hi. nice to meet you. connie: nice to meet you. lemonis: they see about 600 vendors a year, and they know that they're talking to about six million customers. it was one of the few times that i had one of my camping world employees actually in the episode. amber: right? in fact, kelly allen runs my entire retail business for camping world now. amber: she's great. lemonis: jenn, if you can show them some products, that would be great. jenn: sure. okay. lemonis: hey, robin, can i show you something inside real quick? robin: okay. jenn: i'll just start. robin and i met when we were in kindergarten, and we grew up together. we came together based on a need. the need is to remove harmful chemicals from our homes that we use every single day. we wanted to group everything together as our family line of products. that was our initial intent -- to mix up very natural products for you and your family.
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connie: jenn, can i interrupt you just for a moment? when i look at your product, i see "eco-me all-purpose cleaner," but it doesn't tell me what it cleans. jenn: well, you know, we're -- we're saying that it's all-purpose. i mean, it really can clean almost everything in your home. connie: wood? jenn: not wood. connie: okay, see? jenn: mm-hmm. it kills germs and bacteria. kelly: is that on there? jenn: yeah. i mean, our vinegar does. it says it in the labeling. connie: does it smell vinegary? jenn: no. we worked very hard on that as well. connie: i smell the vinegar. how are you going to compete in the market? i mean, 'cause you really can't tell me about your product -- of really what it does. jenn: yes, we can. we just haven't figured out how to do that yet. connie: well, when are you gonna figure it out? jenn: we're working on it now. kelly: i see "dave," and i don't really understand who dave is. connie: who is phil, dave, matt, and emma? jenn: they're our friends and family, basically, and they're supposed to replace your friends and family. kelly: i think we're missing it a little there. this is broke for our stores as far as packaging goes. connie: it is broke. i don't feel that you're ready at all,
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and then when i'm asking you about your product, i didn't get a good, clear answer as to -- jenn: i would have if i knew that i was meeting with you today, lemonis: no! okay, note to everybody as the takeaway. you don't need to know that somebody's coming to have your act together. you have to be ready all the time. you may meet somebody in an elevator, at a lunch, at a party in your office. you're always going to meet an opportunity 'cause it knocks when you least expect it. jenn: i mean, obviously, i do my research when i come prepared. connie: you have to be ready, or you're not even gonna get an audience. that's how it rolls in retail. i'm not convinced that you can do it. lemonis: thank you, ladies, for stopping by. kelly: thank you. robin: thank you very much. jenn: thank you. lemonis: mistake number 2 -- or number 19 -- for me in this episode is that i normally would have asked jenn after, "how did you think that went?" 'cause i want to get her perspective, and anytime you're coaching one of your employees, you know that you've drawn your own conclusion.
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but it's important to understand how that person felt like it went, and understanding what their perspective was will help you navigate and mold the process going forward. so that was something that i definitely missed. jenn: so this looks like a lot of chemicals. what are you looking to clean with -- do you mind if i ask? lemonis: sounds like you're trying to sell a timeshare. she didn't do well out there.
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i don't necessarily agree with her assessment, but i do like the fact that she was comfortable pushing back, and as the takeaway, the best kind of business partner to have is one that doesn't always agree. when they agree, it doesn't really create a push and pull that is required in being an entrepreneur. now, i feel like she was defending her from an emotional standpoint, not a factual standpoint. she didn't do well out there. robin: it's a person and their job and their role. lemonis: so what did i do to her that is disrespectful? jenn: you just told me i wasn't good at something that i've been doing for six years. lemonis: you're not! jenn: really? lemonis: quarterbacks get cut all the time. robin: this isn't that situation. lemonis: it's a business. this is about putting people in the right place. you are not a salesperson. ♪♪ jenn: camping world, here we come. lemonis: i invited the eco-me team to one of my camping world stores to set up a display on the floor and sell their products. i wanted to see what kind of reaction potential customers would give them. so i'm gonna introduce you to johnny,
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who handles business development for me across all my businesses. johnny: all right, come on over. you can go ahead and set up. we'll see how you merchandise it, and now we need to see what our customers think of it, okay? jenn: excellent. let's do this! ♪♪ this comes out. i just don't want to break my nail. oops. sorry. lemonis: this looks like something you bought at ikea. robin: this is something we bought at ikea. lemonis: [ chuckles ] robin: okay, i'm one screw short. johnny: you know, robin, i didn't realize all this was gonna be getting assembled. this is kind of rough, bringing it in and set up inside store. boxes out. yeah, let's make sure we don't get in this spot again. robin: okay. lemonis: i allowed them to come into my business with my fellow coworkers, and i had johnny sirpilla, who is the president of camping world at the time. i remember johnny being horrified. in fact, let's let him tell you for himself.
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can we get johnny on the line? amber: yeah, let's get him. [ phone rings ] lemonis: hey, johnny. how are you? jenn: marcus, good to hear from you. lemonis: you remember the eco-me presentation. how did you think that went? johnny: when i saw the display going up, i knew we were in trouble. as we talked about at the time, bringing them in on a saturday in one of our top-performing stores on our busiest retail day of the week isn't ideal, but the display itself, once it got put up, although a little bit homemade, it was presentable, but it wasn't the best presentation of the product that would ultimately sell it. but in that testing environment for what we were trying to prove, really, to them at the time, i think it proved out what you thought from the beginning. lemonis: right. okay, johnny, we'll check back with you later. robin: hi. how are you? jenn: hi. what you buying? man: i need to get some toilet stuff. robin: hi. hi. lemonis: one of the things that i learned through this whole process is that you have to show up to an event like that with small sample bottles, and there's a cost associated
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with creating small sample bottles. but you have to think about that as a form of marketing. and in order to get people to engage, if you give them something for free, they're going to stop and take it. trying to stop somebody that's just walking by to -- to sit down and talk about it sounds like you're trying to sell a timeshare. jenn: and then what are you gonna clean that with? man: this right here. this bottle right there jenn: this bottle right there -- the all-purpose cleaner. robin: do you have a pet? do you have a dog? no? jenn: so this looks like a lot of chemicals. what are you looking to clean with? do you mind if i ask? man: everything. jenn: everything? so why don't you try this today, too? you know, this you're spraying -- you know. yeah. lemonis: jenn is being way too aggressive with the customers. instead of selling the value of her product, she's tearing down the other products. and robin's even struggling to have a conversation with anybody. i noticed that robin and jenn weren't listening to anything that i was saying, one of the things that i wanted to do is show robin
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what a good, old-fashioned focus group was. and i had johnny gather a bunch of people together. i thought the focus group would actually give them an opportunity to get the kind of feedback that would make them at least question some of their decisions. johnny: all right, everybody, thank you for coming today for our focus group. so the name eco-me -- when you think of that, what comes to mind? woman: when you say "eco-me" -- what is that? there's no tie in to what the actual product is. it's a little confusing. woman #2: this looks like a bubble bath. man: if it was in a supermarket on the end aisle, i'd walk right past it. robin: is it because the word "eco"? man: just by the name eco-me, and i wouldn't know what it was. woman: what do the names mean on these? woman #2: "by mia." this one says "by mia." johnny: so what does that tell you? man: it means nothing to me. i don't know who they are. woman: i think the names definitely have to go. amber: johnny, i love that you did this focus group. how well did robin take constructive criticism? johnny: you know, guard was up. it's difficult when you have a thought process of why sales aren't there and then you listen to people
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who give you a total different view of why the sales aren't there and why they wouldn't even stop to even look at the product, even based on the name. if it's gonna take that explanation and trying to get someone to back off their opinion and say, "oh, okay, well, then that makes sense," you lost them. the consumer's not gonna give you that airtime. that's a hard dose of reality, and i don't think that they were expecting that. lemonis: johnny, thanks for coming on, buddy. i appreciate it. the consumer is saying, "it doesn't work," so we are going to change the name. woman: she's just overwhelmed. ♪♪ lemonis: you see beat up right now. robin: i feel the overwhelming burden of, "did i make the wrong choices for the brand?" lemonis: the reason that i continue to move forward with this is because i believe in you. but i'm trying to understand in a positive way,
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and i'm struggling, the dynamic of jenn. i watch her interact with people, and instead of selling, she's defensive. robin: i'm not willing to sit here and have a conversation that picks apart our vp of sales and marketing and my partner. it's really not okay by me. lemonis: i think you have a difficult time separating your friendship from her role. amber: by the way, robin supposedly partnered with her best friend, jenn, because jenn had the sales and marketing experience. lemonis: one of the things that i always like to tell people is don't work with your friends, and don't work with your family because the ability to discipline, correct, retrain, coach, criticize, terminate are almost off the table unless you're willing to put your friendship on the table and know that it may go away. i want to introduce you to derek. derek, say hello to everybody. derek: hi, everyone. robin: hi, derek. derek: how are you guys? lemonis: derek's gonna unveil a couple of concepts. this is what, conceptually, when you see the tree, you think of eco-me. derek: you can see that there's actually elements in here
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of the bits and pieces of all the stuff that it would clean. lemonis: this would be what our bottle would look like, fully wrapped. and we got rid of all the names you used to use. robin: i really don't like the colors. lemonis: how about, "i like the concept, but are there other color options? is there ways to tweak things?" it's always important to at least be complimentary. "thank you for coming here. thank you for taking your time to do this." at least be polite. robin: usually, when you see bright primary colors, what comes to mind are fast-food joints. lemonis: i'm kind of confused. you didn't want a lot of bright colors, but you didn't seem to mind to throw up all over your bottom. robin: okay, so i don't take it as throw up, so, you know... lemonis: i mean, you just, right out of the gate, just said -- robin: i said "primary colors." i said i don't like these colors. lemonis: so this is okay 'cause it's pastels. robin: i wouldn't even say those are pastels, but i feel like these primary colors scream "mass market" -- too extreme. lemonis: does that mean because it's not your idea? robin, i don't give a crap what it looks like. what i care about is that it sells, and that isn't selling. i want to remind you that i'm in charge and that during this process,
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your feedback isn't any more important than anybody else's. we're a team, we're gonna function together, but we are gonna make a change. you don't look like you want to get in there. let me show you how to clean the toilet. what better way to get somebody to feel connected to you than for you to get down and clean the toilet? that makes the potential buyer uncomfortable because it looks like you don't have your act together.
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when you switch to xfinity mobile, you're choosing to get connected to the most reliable network nationwide, now with 5g included. discover how to save up to $300 a year with shared data starting at $15 a month, or get the lowest price for one line of unlimited. come into your local xfinity store to make the most of your mobile experience. you can shop the latest phones, bring your own device, or trade in for extra savings. stop in or book an appointment to shop safely with peace of mind at your local xfinity store. lemonis: i've come to new york and i've set up a meeting with jenn and the managers of the strand hotel. landing a major hotel chain could really make a difference in this business. it could be as much as three times more than a typical retail account. jenn: hi. how are you? i'm jenn. nice to meet you. so thank you for meeting with us. we really appreciate it. john: you're very welcome. we're known for our cleanliness, so this is important to us. lemonis: there had been a lot of conflict between robin and i about jenn's effectiveness in sales. and so what i wanted to do is give her an opportunity
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on her own terms to have a meeting. she would have the ability to present the product, to pitch it, and to try to activate it into something that would actually make money. jenn: so we have amazing line of products that really get the job done with the most natural ingredients possible. eddie: which of your products you would use as a disinfectant, which is our biggest concern? jenn: our all-purpose cleaner is a disinfectant. it's made with vinegar, which kills up to 96 percent bacteria and germs alone. johnny: are you getting that in terms of an aroma? jenn: no. john: at all. jenn: you know, a tiny bit, but ammonia and bleach, that's okay? [ laughs ] you know, it's just funny to me. okay, interesting. eddie: speak to me more a little about your dilution system. jenn: okay. eddie: how does that work? jenn: yes, everything on -- it depends, yep, what it is that you're gonna order as far as size-wise -- our, um, dilution, um...sorry. lemonis: what a company like that wants to see is a line sheet -- one or two pieces of paper that have every product you have,
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the options, the pricing, the shipping, the lead time -- all of the information. and instead she's flipping through pages. and that makes the potential buyer uncomfortable because it looks like you don't have your act together. john: it sounds like a great product, so we have one or two other vendors that we're entertaining, and thank you. jenn: great. lemonis: no, no, no! when the other side gives you a reason not to move forward, you have to give them a reason to say yes. and you go back and forth in a very elegant way, like you're playing tennis until you start to get yeses, and then once you get them in the habit of saying "yes," saying "no" feels uncomfortable. here's a good example. "do you think it's a good idea that you avoid chemicals in your hotel room?" "yes." "do you think it's a good idea that people know that you're using natural products to clean the hotel room?" "yes." "if i give you some samples for a week at no cost to you, would you be willing to try it and get some feedback from your employees and your customers?" "yes." see, i want to get yeses. and i want to get that momentum going,
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as opposed to saying, "okay." hold on a second -- i have a question. what do we need to do to earn your business today? i mean, that's obviously why we're here. we understand that you have other products. but when jenn and i talked about coming here, we came to ask for the sale, so... john: well, i think, you know, in short, you know, the only question that i really will make sense is -- it's testing this product out. jenn: absolutely. lemonis: do you have a room that we can go clean right now? john: yes, of course. we should do that. lemonis: well, we're willing to go clean toilets for you right now, so do you have a room that we can go test this in? okay, great. all right! i'll take the shower, jenn, you take the toilet. jenn: i don't do the toilet in my own house. really? john: so you're really going in there, huh? lemonis: heck, yeah, because if i don't believe in the product, you won't believe in the product. john: love it. lemonis: come on, jenn. you're like the supervisor or something. what i want you to see is the cleanliness of the glass, but more importantly, take a sniff. john: i get the scent. lemonis: smells clean. john: i get the scent.
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there is a freshness that's impressive. lemonis: you don't look like you want to get in there. come on. lemonis: i would have rather the toilet bowl cleaner be called marcus 'cause in this episode i was the only one that cleaned the toilet. jenn: that's where all the gross is. amber: that's my most prized moment, 'cause she wouldn't clean the toilet, and you did. lemonis: what better way to get somebody to feel connected to you than for you to get down and clean the toilet? and she was like, "no, i don't -- i don't do that." amber: she doesn't get her hands dirty. lemonis: no. well, we're looking forward to your first order. we're excited. eddie: thank you very much. lemonis: we'll have the box on the way. that last line is what i would call an assumptive close. an assumptive close is almost assuming that the deal's done. instead of asking somebody, "would you like to buy it?" you're gonna say to them, "great. i just wanted to let you know the box is on the way. we're really looking forward to doing business together the first time." you're almost like acting like they said yes already, and you're waiting for them to stop you. you understand the product, and you are a great face of the company. but i still don't think that sales is your core competency.
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jenn: i disagree. i am the reason we have sales for this company. there's no room for discussion here. lemonis: yeah, but then i'm not writing a half a million dollar check. the company's about to fizzle away, and i think where i'm at is i'm not willing to do the deal if you're in charge of sales. jenn: i've been working my ass off for six years... lemonis: nobody's doubting that. jenn: get us on the map, and someone's coming in and saying, "you suck." lemonis: if you want to save your business, your reaction to constructive criticism shouldn't be defensive. you don't like constructive criticism. you just don't like it. jenn: i'm gone. lemonis: here's the challenge that i have with how jenn is is behaving in this moment. she said to me on several occasions that, for the last six years, she's been doing this, and no disrespect, but in the last 12 months, the business generated a half a million dollars of sales.
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and i'm not minimizing a half a million dollars, but after six years and losing money year after year after year, at some point, you got to go to a different game plan. i just got off the phone with them, and they have no idea why the final product looks that way. you just went on your own and did that. she just let her stubbornness and her pride get in the way. if you're looking to take your business to the next level, log on to... many plug-ins are stuck in the past. they release a lot of scent at first but after a while, [ phone rings ]
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jenn: i'm gone.
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lemonis: hey, robin. marcus. robin: hi. lemonis: so i just spent an hour with jenn at the strand hotel at an appointment that i got set up. we went upstairs to one of the rooms, we cleaned it, and then i gave constructive criticism. she became unglued. robin: mm-hmm. lemonis: how do we best move forward so that it works for everybody? robin: everything's changing, but jenn really knows the brand and the industry. and i think she's committed to this company, and we're committed to getting this going, so... lemonis: yeah. why are you so upset? jenn: because this is my livelihood, marcus. lemonis: yeah, but i'm not trying to take your livelihood. i'm trying to save it. jenn: you seem like you are without me in mind. you seem like you have an agenda, and that's why -- lemonis: here's what my agenda is -- my agenda is to save your business. jenn: i understand. lemonis: you haven't gotten a paycheck in how long? two years? three years? jenn: yeah. okay, you've got to let me help. jenn: i want you to help. lemonis: okay, i'm here. jenn: but i want you to understand that i do deserve to be in the sales business. this is me. this is what i do. this is what i've always done. lemonis: are you willing to be coached through that process?
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jenn: yes. lemonis: okay. i will give you the support that you need, but you have to not get explosive with me, and you have to trust that what i'm telling you isn't to hurt you, it's to help you. you really have to believe that. is that a deal? jenn: yes, absolutely. lemonis: okay, can we shake on that? softy, marcus. back in los angeles, i was originally on my way to eco-me to talk to robin about jenn's performance at the strand hotel in new york, until i got a call from the graphic designer telling me that robin changed the labels. that was way more pressing. robin, so i just got through finding out that you changed the labels. robin: we just didn't like the direction it was going. lemonis: our deal was, when i left here, i told you that i was in charge. for a week, dummy. do you take direction well? can i trust you? it was kind of a violation of our agreement. robin: you told me to work with the designer. lemonis: but you didn't. robin: yeah, we did. lemonis: well, i just got off the phone with them, and they have no idea why the final product looks that way. robin: we were trying to get it that way, and they couldn't, so at certain point, we put it into the context of -- lemonis: so you just went on your own and did that.
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i have somebody that i'm paying to come up with something. at a minimum, she could have just called him and said, "hey, look, i'd like to make this change and that change. what do you think? you're an expert." and they start working together on it. at the end of the day, i don't have a problem with people pushing back, but i have a problem with people going around me to get it done. when we make an agreement and we're gonna work together, i shouldn't be changing things, and you shouldn't be changing things 'cause it violates our trust. i feel like you include me when you need to and don't include me when it's convenient. robin: yeah, i mean, i could see how we might have gone rogue and it should have been a conversation before we -- lemonis: yeah, i have 6,000 employees, and i want them to have their own minds and take chances. but when we have an agreement and we shake hands, i don't ever want to wonder if that's gonna change. robin: you know, as much as i might be a control freak and my team sees that and i have that feedback and i know i need to work on that, i can be humbled by this. i know when i've done something and maybe there is a better way to do it.
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and yes, 100 percent, my apologies to derek and to you. lemonis: i understand that change is difficult, and i understand that she wants to control things. i get that, but i also respected the fact that she was like, "you know what? now that we're talking about it, i can see your point. and i have learned from this issue." and that's really all we want from people, is just to learn from it and grow from it. robin: i'm a very caring person. i would never set out to do anything that would "a," put my company at harm or people at harm that i work with. and i do sometimes get too stuck in my head and stubborn. i know my fault. lemonis: good enough for me. just own it, and let's move forward. lemonis: you and i are gonna be fine. i have thick skin. i'm used to entrepreneurs like you. i'm gonna to go out in the warehouse and see the guys, and i'll catch up with you a little bit. robin: thank you. lemonis: robin understands the details that are required to run a business, and she has purp oh, interesting. amber: what? lemonis: wait a minute. it's the same label that she hated seven years later.
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man: this is our machine right here right now. how many do you guys get done in a day? raul: we can probably get 1,200. man: with this new machinery, you're gonna be able to get 10 times that done -- 50 a minute. this is the actual machine. your line speed's be fast enough to where you're not gonna be able to keep up with 55-gallon drums. our labeler will hot-stamp coat all the labels with the date lock codes. you're gonna have a touch-screen computer thing that'll tell you how many bottles you filled in a day. raul: wow, that's great. lemonis: i've spent over $180,000 improving the equipment and machinery here, and i've paid off nearly all of their debt. i'm gonna be well over $500,000 when it's all said and done. we now will have what i would consider a legitimate company.
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[ applause ] you know, robin, this package got us to here, and this package gets us to $10 million. how hard was this process for you? robin: this was so painful. it was almost like cutting off a limb. to be able to step back and realize that i had to do it for the company and then see how great it is and how much better it is. lemonis: pull up the website today. do a screen shot. oh, interesting. amber: what? lemonis: wait a minute. it's the same label that she hated seven years later. amber: oh, it is the same labels. that's funny. robin: it's amazing. i get it now. people will now know eco-me instead of being, "is it bill? is it emily?" i get it. lemonis: and i'm proud of you, robin. i'm glad that you see that this is really a transformation of robin as a leader as much as it was a transformation about eco-me as a company. and the fire that you have in your belly is the reason that the business has been able to survive all this time. if you can just get that positive energy turned in a direction that takes us to the next level, i'm confident you'll get us there. robin: well, thank you so much.
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i couldn't have done it without you. lemonis: i always focus on people, process, and product, and in this case, the people have made a real turn. jenn is doing a great job at listening and following my lead as it relates to sales process and sales presentation. she's lined up some new, big national accounts and i'm very proud of her progress. robin has become a much better leader and she's improved not only the process, but she's improved the product. the new labels are in place, and sales are up almost 50 percent in a very short period of time. with the help of these two and the other employees, we're well on our way to getting to $10 million. in the year after doing this particular deal, when the cameras went down, it did become a lot easier to work with robin and jenn. she was far less guarded than she was, and i think the cameras definitely made her nervous. her level of intelligence and her focus on the business grew the business. and about a year and a half after i made my investment, she was able to sell the company to somebody that could make it even bigger.
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i got all of my money back. i didn't make much of a profit, if anything. but what i'm most proud of is how robin was able to transform into a better leader, how jenn was able to transform into a better salesperson, and how the company was able to transform to the next level and still exist almost eight years later. happy friday, it's time for "options action. here's what we've got lined up for you. >> writing it home the interest rate ripple spread all the way to your regional bank carter worth charts the course. then it seems everything always comes pack to apple in some way, too, now doesn't it? tony zhang sees the orchard through the trees. coming or going? professor mike khouw tests the doppler effect around target it's time to risk less and mak


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