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#CinemaJourney
#The Fixer
#The Fixer
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00:00Across America, thousands of businesses grinding it out every single day because the ultimate
00:09American dream is owning something you built. Everything will be stationary for when Marcus
00:15comes in. Every episode, I'm meeting businesses at a crossroads. We've actually invested our
00:21entire life savings into this business. I'll pick one and go to work, but I'm not a consultant.
00:27I don't believe in handouts. I'm a capitalist. This is $15,000. Always looking for ways to
00:34make money. That's why we want you to work with us, because we're bad at math. That's a
00:38terrible reason. You should be good at math. I'll work on their people. I don't know why
00:43you're being such a dick about it. Leon, are you mad about something? No. Why the f***
00:47are you singling me out? They're processed. The execution is just like, what is it? And
00:53their product. We've heard from the clients that it's not so easy. That's f***. Marcus
00:58is an amazing investor, and hopefully we'll invest in our business. In the end, we'll
01:02negotiate. My offer is $500,000 for 10% to see if a deal can be made so we both can profit.
01:10Yeah, no, it's not. Hi. How are you? Nice to meet you. I'm Jeff. Jeff, I'm Marcus. Pleasure.
01:22Hi, Danielle. Nice to meet you. Danielle, nice to see you. This is our son, Liam. Liam, how
01:26you doing, my man? Good. How are you? So we own a company called Escape Room New Jersey.
01:31Okay. We now own three locations. Oh. What kind of revenue do these locations do?
01:36Engelwood's the smallest. I'd say Engelwood's about $10,000 a week, I would say.
01:41So just extrapolate that out. A half a million a year? Yes. What's the next location?
01:46Madison, probably pulling in about $15,000 to $20,000 a week. So Pompton Lakes will be our
01:51next location. And revenue there? That one's between $20,000 and $25,000. Okay, so $2.5 million
01:58in total? Is that about right? The whole company, I'd say about two. What's the bottom line?
02:02Between one and 1.5. Wow. So that's a pretty big net margin return. Why don't you have more of these?
02:09That's where you come in. Oh. I want to create this into a franchisable concept. I want to open
02:13these all over the country. That really is the dream. Okay. All right, let's have some fun. Yes,
02:18let's have some fun. We're going to do the escape box first. There's a coin in here that you need to
02:24access. You're looking at the box. You can see there's locks, right?
02:28Looking for a combination. Okay. Excellent.
02:33And here's my coin.
02:38So what are we doing? And now you may bump.
02:42Make you out, Liam. He's down. Mark this one.
02:46Next, we're going to move to the rage room.
02:49I get it. Clearly, based on the numbers, it's a great cash flow business. But if you don't
03:00constantly change the game, at some point, your ability to retain customers would dissipate. And
03:07right now, for me, I don't think it's scalable. So I don't think that it's something that I would
03:14invest in. Thank you for the opportunity. Of course. Thank you. I appreciate you. Thank you so much. Thank you for your time. Thank you very much.
03:25I'm live through this.
03:27Wow. How are you?
03:29Hello, Marcus.
03:29Marcus.
03:30Very good to meet you.
03:31What is your name?
03:32Frank.
03:32Frank.
03:32Frank.
03:32Nice to meet you.
03:33Sean.
03:33Sean.
03:34Sean.
03:34Nice to meet you.
03:35Good to meet you.
03:35Carlos.
03:36Carlos.
03:37Nice to meet you.
03:38Brian.
03:38Pleasure.
03:38Brian, how are you?
03:40Good.
03:40So we are Brothers Guitar Shop. We are a retail store in Manhattan. We started out of a back of
03:47our hardware store, our family-owned business. Oh, wow. Yeah. Our parents are immigrants,
03:51so we're first-generation Americans. It's a family business that's been established for
03:55how many years in New York? 40, 40 years. 40 years pushing. We've been really focusing on trying
04:01to have us spending more time on the guitars. Guitars, it's more of our passion, you know? That's
04:06what we like to do. Is it more profitable than the hardware store? No,
04:09it's not at all. The margins are way better in the hardware business. 100%. It's, you know,
04:14a pack of screws, you buy it for 57 cents and sell it for $4.99. Here, it's a 30% margin
04:21on all new gear. Do you guys provide guitar lessons? We do, yeah. We do. We also love to do
04:28the used stuff. The used, we make the most profit right now. I think that- No, you don't.
04:33Well- In the guitar lesson business, there's no cost associated with it. You essentially split
04:38the revenue with the instructor, and that's it. Totally. Makes sense. Totally. It's 100% margin.
04:43Well, the used, we see the most money out of it in the register. Generating the most revenue is
04:48different than it being the most profitable. Yeah. Right.
04:50It can generate the most gross profit, but there's also expenses against it. Can I use your guitar as
04:56an example? Consider this like your revenue, and then all the way down, you'll have your cost of
05:02goods, and you'll have all of your expenses, and then at the bottom, you'll have your profit or not.
05:07And I think that if you're running multiple businesses, this is one P&L for used sales,
05:12and there's one for new sales, and there's one for service, and there's one for lessons.
05:16And in the end, you're going to see what the bottom line is. This hobby business still feels like
05:22a hobby because knowing the sectors of revenue and the gross profit and the expenses associated with
05:30them is not as clear for me yet. Am I wrong? No, you're absolutely right.
05:35You're absolutely right. I mean, we're kind of all over the place.
05:37And that's why I don't think there's an opportunity here for us together.
05:43Keep your hobby going, but not at the expense of your hardware business. Thank you for coming today.
05:49Thank you, Marcus. It's great to meet you. I appreciate it.
05:52We'll see you next time, guys.
05:55That's it.
06:11Okay.
06:11Well, that's an interesting way to make an entrance.
06:21Nice to meet you there, young fella. How are you?
06:22I'm Marcus.
06:23Marcus, I'm Gene Seller.
06:24Gene, nice to meet you.
06:25Nice to meet you, too.
06:26So, what is it that you do?
06:27I own a store called Jazz Audio, and I do a bunch of accessories on cars. You know,
06:33we do amplifiers and lights underneath the car, power steps, rims and tires.
06:39So, your company soups up my ride, makes it sound better, look better.
06:43It's perfect.
06:44Let's maybe put the music on. I want to hear how good this bass is.
06:49I'm going to give you a demo.
06:50Because I just want to clarify, I'm from Miami.
06:53So, bass for me is very different than it is for most people. I know what bass is.
06:57You do.
06:58I do.
06:59And you have a subwoofer behind the seat?
07:01I got an amp behind the seat.
07:02And by the way, this is called a downfire box, and I'll tell you why.
07:06A what?
07:07Downfire box.
07:08Downfire.
07:09Right.
07:09You know why?
07:09Because you can put anything you want on top of it.
07:11Okay.
07:11Hold on.
07:13Yeah, get in there.
07:14All right, go ahead.
07:16Okay.
07:22You know what I'm saying, buddy?
07:25Now we're rocking.
07:29That's how you drive a car.
07:30I thought I was going to be a rock star.
07:34It didn't happen.
07:35So I had an opportunity to open up a stereo shop, and I jumped all over it.
07:40So I've been in the car business for a big part of my life, and seeing stuff like this,
07:46aftermarket distributor of car accessories that does installation.
07:50Right.
07:51And there's a million of them.
07:53Yeah, but they're not cheap.
07:54They're not jazz audio.
07:56I know you're going to ask me, what separates you?
07:58Me.
07:59My whole system, my whole procedure.
08:01You have a process?
08:02Of course.
08:02It's like McDonald's.
08:03I got a process.
08:04So let me, let's take a step back.
08:06Shoot.
08:07If you're not a manufacturer, your market is only as big as your labor reach.
08:13Your basic trade area, BTA.
08:15Okay.
08:16That basically means that this is the area that you can influence.
08:20Yeah, my store will take out a certain amount of, you know, square miles, 100%.
08:24So it's limited.
08:25Yeah, unless you have a bunch of stores.
08:28Is that your goal?
08:29That's my goal.
08:30How many you have now?
08:31I have one.
08:32What's your total revenue?
08:33Bring it in, like one, three.
08:35And on the bottom line?
08:36400, 450.
08:40And so how much money have you saved?
08:42Uh, do I really want to say that?
08:45Well, I mean, I think, I think ultimately.
08:47I got money saved.
08:48No, you don't have to give me a dollar amount.
08:51But what I'm asked, what I'm trying to understand is you've built a heck of a business.
08:55Yes.
08:55Truly like the American dream.
08:57Yeah, definitely.
08:59So why am I here?
09:00What's the opportunity?
09:01I want to get another salesperson.
09:03I want to, I want to start training some people at the location I have now.
09:07Get them ready for the next location.
09:09My job is to help you navigate to where you want to get to.
09:12And to use my resources and things that I know and the people that I know and the things that you
09:18know and try to put it together to make the road from point A to point B as straight as possible.
09:23Yeah.
09:23No matter what we do, no matter how much we know, that road's not going to be straight.
09:27The fire in my belly's not out.
09:28To do what?
09:29Make more money.
09:31You're a great guy.
09:31I'm just thinking about what I want to do right now.
09:34Well, listen, you can get back to me.
09:37I could or I can tell you now.
09:38You could do both.
09:39Yeah.
09:39It's your choice.
09:41Yeah.
09:51You're a great guy.
09:52I'm just thinking about what I want to do right now.
09:54Listen, you can get back to me.
09:56I could or I can tell you now.
09:58You could do both.
09:59I think this is an opportunity worth pursuing.
10:03I want to do some business with you.
10:05If Gene's numbers are accurate, $1.3 million in revenue and $400,000 in profit,
10:12well, that's interesting to me, but I'm not just going to write a check.
10:15I want to look under the hood to find out if the people, the process, the product,
10:19and the profit are legit.
10:22I guess we're about to find out.
10:23I'm here in Long Island, New York, to see Jazz Audio and its owner, Gene.
10:40When I saw the product the other day, I saw a couple of things, but I want to understand.
10:57Is this a big business?
10:58Is it even an opportunity?
11:01How are you?
11:02How are you?
11:03How are you?
11:03Good.
11:03I'm Marcus.
11:04I'm well, because I'm Rob.
11:05Rob?
11:06Robert.
11:06Yeah.
11:06Michael, nice to meet you.
11:07Michael, nice to meet you.
11:08The aftermarket automobile business is really enticing because not only do manufacturers tend
11:14to drive price down by leaving options out, but with the used car market being as good
11:18as it is, it gives consumers the opportunity to customize the vehicle to exactly what they want.
11:24And whether that's rims, running boards, alarms, leather seats, a variety of things,
11:28it's a great business with great margins.
11:31Gene, Marcus is here to see you.
11:33Marcus is here for me?
11:34Yep.
11:34Oh, come on.
11:34You want to meet Marcus?
11:35Good morning.
11:36Buddy.
11:37Hey.
11:37Marcus, how are you?
11:38How are you?
11:39That's my wife, Susan.
11:40How are you?
11:41Nice to meet you.
11:42She made a surprise visit on me.
11:43She came to check on you to make sure you're behaving?
11:46I guess.
11:48So is this Jazz Audio?
11:49This is Jazz Audio.
11:581985 called and they want their store back.
12:03What's going on here?
12:04Okay, so these are a soundboard.
12:07These are speakers.
12:08Why are these empty?
12:09Sold them out of the board.
12:10How long ago?
12:11Too long ago.
12:12How long has this stuff been in the case?
12:14Uh, God, that stuff has been in that case so long that none of those radios are current.
12:21They all need to be changed.
12:22How many of these are out of production already?
12:24Probably half of them.
12:25So half of them, they don't even make any.
12:27They don't even make any more.
12:28It feels like time stood still in here.
12:32And that technology changed.
12:34And then as you sold things, you just didn't replace it.
12:36I mean, there's a lot.
12:39There's a lot of empty slots here.
12:40I agree.
12:41That's not a good look.
12:42It's a terrible look.
12:44When somebody walks in the front door, if they have a good experience and the parts are in inventory,
12:49their likelihood of them buying it is increased.
12:51And if they buy it, the likelihood of it going to the shop
12:54and giving those guys the chance to earn money is also increased.
12:57That's it.
12:58That's it.
12:59Sell more, service more, make more.
13:01It feels like you're not paying attention to the business.
13:04Just, that's my first impression.
13:06When I first met Gene the other day, he said...
13:08Now on Long Island, my store will take out a certain amount of, you know, square miles.
13:13So it's limited.
13:14Yeah, unless you have a bunch of stores.
13:15Is that your goal?
13:16That's my goal.
13:17There's this great concept to take across the nation and...
13:23Um...
13:26No.
13:26Michael, how long have you been here?
13:28About two years.
13:29And what did you do before this?
13:31I ran global operations for Alliance Bernstein for 23 years.
13:34Well, that's a big deal.
13:35Are you the manager?
13:36Yeah, I said no.
13:37Which part is yes, which part is no?
13:39Well, I handle most of the interactions with the clients, sometimes with the retail,
13:44but I don't like directly order anything or control, you know, that type of stuff.
13:48Who does that?
13:49Uh, Gene.
13:51He used to manage a business a hundred times the size of this.
13:54His aptitude and his knowledge of being just a general manager of sorts is probably greater than
14:01Gene gives him credit for.
14:02And what is the inventory management?
14:03There really isn't one.
14:05There isn't one.
14:06No.
14:08Running any kind of business without an inventory supply chain system
14:11is really like deciding that you don't want to be in business anymore.
14:14Knowing what you have in real time, knowing what's coming and understanding what to reorder
14:18is all about predicting how sales are going to flow through your business.
14:22But with Gene, not tracking the inventory is a problem.
14:25That's headquarters.
14:26That's me getting ready to put on a show.
14:27Who is?
14:28That's me.
14:29I always wanted to be a rock star.
14:31Tried to get a couple of record deals and it didn't pan out.
14:34But I love music.
14:35So I opened up, you know, a stereo shop.
14:37I started out as an installer.
14:39I did sales.
14:40So this is mama.
14:43Who does the installations?
14:44They do my installers in the shop.
14:46Juan, Rob, Richie.
14:48So there's three installers?
14:50Correct.
14:50And one salesperson?
14:51Correct.
14:52And me.
14:53The installers, listen, I love them as people and whatnot.
14:56But do they need help?
14:57They need to get here on time.
14:59They need to be more assertive instead of just sitting on their ass waiting for a car to come in.
15:03Yep.
15:04And if I tell them, hey, if I say anything to them, they'll just walk out.
15:07And I need a mechanic.
15:10You know, so they're not listening to me.
15:12So that's the real.
15:13Why don't they listen?
15:14They don't, because they don't care.
15:16They just want a paycheck.
15:17They're welcome to America.
15:19They don't want to work.
15:20It infuriates me when a manager or an owner of a business thinks that people are just sitting on their ass.
15:25Guys, this is Marcus.
15:26I just experienced no inventory on the shelf.
15:29But now you're accusing your technicians of sitting on their ass because there's no work.
15:32There's no work because there's nothing to buy.
15:35So the technician is my most favorite person in the whole world.
15:39It's been since I was a little kid.
15:41That would be me?
15:42I grew up in the auto business.
15:43I grew up in the shop.
15:45Okay.
15:45I grew up in the parts department.
15:46I was an assistant tech.
15:48I was a service advisor.
15:49So I understand the plight of the manager inside and the technician outside.
15:55So I get it.
15:57Technicians are the most important labor pool for me in the entire world.
16:01They are the driving force of everything that happens in this country.
16:04And they are underappreciated and they are underrecognized and they are underpaid.
16:08The other thing that I know about technicians, they don't say a lot.
16:11But when they do, you better listen.
16:14How long have you worked here?
16:1525 years.
16:17What?
16:18Yeah.
16:19You've been with him, Gene, for 25 years?
16:2125 years.
16:22I've been here 15 years.
16:25So you guys like it here if you've been here that long?
16:30It's okay sometimes.
16:31Sometimes it's just too much tension.
16:34What drives that?
16:37Who even came up with such a stupid idea?
16:39Where was the brain power to come up with that?
16:40There's two genes I always say.
16:42There's a happy gene.
16:45And there's an evil gene.
16:48There's the gene that will insult you.
16:51I'm saying you look cranky.
16:52Did you have a bad night?
16:53Did you get into a fight with your husband or something?
16:56Berate you.
16:56Richie, I'm killing myself and you're sitting on your ass.
17:00You don't know what you're walking into.
17:01He'll blow up on some of the dealers.
17:05And we lost a couple of dealerships.
17:06Which are the lifeline of the business.
17:08Yeah.
17:09There are two distinct streams of revenue in an aftermarket business.
17:13Individual customers who walk in and wholesale customers like dealerships.
17:17So no product to sell at the front of the store.
17:20And now you've pissed off all the dealers in your local area?
17:23How are these guys supposed to make a living?
17:25Richie?
17:26How you doing?
17:26How you doing?
17:27I'm Marcus.
17:27Nice to meet you.
17:28How are you?
17:28Good.
17:29How long have you been here?
17:30I started in 93.
17:33That's a long time.
17:34Mm-hmm.
17:34I'm getting the sense from Michael and from the other guys that most of you are unhappy.
17:39100 percent.
17:41He has good days, a lot of bad days.
17:43What are his good days like?
17:44It could be fun.
17:46And his bad days?
17:47Just berated.
17:50It's not right.
17:51I don't know why anybody would do that to somebody, especially somebody that's worked
17:57for you for that long, made you money.
18:00How hard he is on Richie is just, it upsets me.
18:05I think it'd be helpful if you guys are open to it, where
18:08the five of us have an honest conversation once and for all.
18:11That would be tremendous.
18:12Let's so see if Gene's available.
18:14This is a bigger challenge than I ever thought that I was signing up for.
18:19And it's a smaller opportunity than I thought I was signing up for.
18:23Do I care at this point?
18:24No, because I'm so pissed off.
18:26And I'm so fired up about the way the guys in the shop are treated.
18:30That I don't care how much time I have to spend here.
18:32I'll feel good about it.
18:34And that's all that matters.
18:35What I think is broken is the relationship between you guys.
18:38They have a lot to say.
18:39You have a lot to say.
18:41Best thing to do is flush the toilet.
18:43So the doesn't sit in the bowl anymore.
18:45Yeah.
18:47I have no problems starting off.
18:50My big thing has always been mutual respect.
18:54We've had this conversation.
18:55Many times.
18:56Is there a lack of respect for each other?
18:57I don't think you respect any of us.
18:59Why?
18:59Why do you feel that way?
19:01The way you are.
19:03I feel like some of you guys, you come in and you just want a paycheck.
19:07And that's it, no matter how it is.
19:08That's not true.
19:09I'll tell you what.
19:10You put yourself in that shoe right there and you own the damn store.
19:14Would you pay me to sit on my ass to do nothing?
19:17God, no way.
19:18You would never pay me to do that.
19:20Never.
19:21You would throw me out and go tell me to go to home.
19:23And you guys know you would.
19:24Richie, get off your fat ass sitting in the corner when I got no work going on.
19:28Come up to my office.
19:29Hey, you got anything you want me to do?
19:31I'd bite the bullet.
19:32Why the are you singling me out right now?
19:39Richie, get off your fat ass sitting in the corner when I got no work going on.
19:43Come up to my office.
19:44Hey, you got anything you want me to do?
19:46I'd bite the bullet.
19:47Why the are you singling me out right now?
19:48No, I'm just looking at the whole crew.
19:50I'm just looking at the whole crew, bud.
19:51That's all.
19:52Not just you.
19:53I'm looking at the whole crew.
19:54Well, you did call him a fat ass.
19:55Well, I apologize for that.
19:57Well, my people process product model is a little busted right now.
20:02Because there is no product in inventory.
20:06They have zero process.
20:08Zero.
20:09And the people are...
20:11How about when I go out and do $1,500, $1,600 and four o'clock,
20:15you want to get rid of me because now it's dead?
20:18It ain't my fault you're so fast.
20:19You're getting paid for three hours.
20:20So I'm productive is what I'm saying.
20:24Dysfunctional?
20:25Should we go with that?
20:26Well, there's no reason for you to get agitation on me.
20:29I'm not agitation, I'm just saying.
20:30One, I need you to get here at 9.30.
20:33I mean, yeah, I know you think it's funny,
20:35but that's costing me money.
20:37I'm a businessman.
20:39What's your thought on what he's saying?
20:41No, I just say he's right, you know.
20:43So you agree with him?
20:44Yeah, I do.
20:46Right, but you can deliver that same message
20:49a totally different way.
20:51And the fact that he just acknowledged it
20:53is a pretty good thing.
20:55The fact that he's productive is a pretty good thing.
20:58Pretty good.
20:58The fact that you called him names, not a good thing.
21:02Got it.
21:0325 years?
21:0430-something years?
21:05Mm-hmm.
21:0515.
21:07So there's some reason against their better judgment
21:11that they stay with you.
21:13Can you imagine if they actually liked working here,
21:17how much better the business could be?
21:19Well, I'm hoping you're right.
21:20Oh, I know I'm right.
21:22Okay.
21:22I know I'm right.
21:24But the machine is not working.
21:25It's broken.
21:26So either we fix the machine and you fix it my way,
21:31or I'm going to leave and never come back.
21:34Those are the choices.
21:35We'll make it right now.
21:36You want me to help you fix it,
21:37or do you want to just let it just die?
21:39I'm with you.
21:40100% in.
21:41I'm with you.
21:42Okay.
21:42Come prepared to work your ass off.
21:44Okay.
21:45I'm ready.
21:46Me and my guys, you know, we're button heads.
21:49I don't really hate them,
21:50but they do aggravate the crap out of me sometimes.
21:53And Marcus does see that.
21:54And Marcus is going to help me try to fix it.
21:58Jazz Audio could use an infusion.
22:00I'll change the name to Marcus Car Stereo.
22:04I have no problem with that.
22:05Everybody's coming to see Gene.
22:08As far as I'm concerned.
22:09Any time I walk into a business, I always want to go under the premise that I'm going
22:18to leave it better than I found it.
22:20And this business is broken with people.
22:21That's Gene.
22:22Has no process, no inventory system, and literally has no product.
22:26And so we're going to have to rebuild the basic building blocks of any business.
22:30Bring inventory in, renovate the store, put a system in place.
22:34And then I can figure out if there's even a deal here at all.
22:37We're going to start over.
22:38We're going to get this business back on track with the right inventory.
22:41And we're going to start chucking any of these parts and pieces that don't work,
22:45that we know are obsolete.
22:46For as much time as it takes to get the store renovated,
22:50I'm going to cover the payroll.
22:51All right, let's get to work.
23:00What's going on?
23:01Marcus and me and the boys are tearing apart Jazz Audio.
23:05My, my.
23:05Marcus, you don't know how bad I've been wanting to do all that.
23:09Well, why haven't you?
23:10Why is that he won't let me touch anything?
23:13I've been wanting to redo the shop and get this place ship-shaped, you know?
23:17So having Marcus come in and get the ball rolling was a big plus.
23:21I feel like I had him on my side.
23:22Michael, can we throw this out?
23:25I don't even care what's in here.
23:26I never go through it.
23:27I do.
23:28That's bothering you?
23:29That is bothering you?
23:30Yes, ma'am.
23:31Oh, my God.
23:35Oh, yeah.
23:36That's right.
23:36There's wires.
23:37It's going to fall.
23:38I knew Marcus was going to do something.
23:40I didn't know it was going to be this extreme.
23:42Somebody's got to grab one.
23:45When I seen him tip over the soundboard,
23:48I knew the showroom was in trouble.
23:50Yeah.
23:5116 years later.
23:54It's empty now.
23:57See?
23:58See?
23:58That was better.
23:59That's why you do it.
24:03Nobody knows half the I do.
24:05Nobody knows half the stuff that I do.
24:07That's life.
24:07That's life.
24:08That's my choice.
24:09I picked it.
24:10I chose to open this store.
24:11I chose to open this store.
24:12I chose to open a taco store.
24:13They call a dealership.
24:14You have a taco place?
24:15I do.
24:15What else do you have?
24:17Shell a bagel.
24:18Okay.
24:18What else?
24:19Used car on up the street, too.
24:20I forgot to tell you.
24:21Okay.
24:21Who runs the used car place?
24:22Oh, I have people for that.
24:23I got a pointer.
24:24Who runs the bagel shop?
24:25Benny's there every day.
24:26He runs it.
24:26Okay.
24:27Maybe this particular business shouldn't have so much gene in it.
24:31I love that.
24:32I would love that.
24:33And maybe it should just be about these guys.
24:35You should put a manager in place.
24:38And you pop in and out.
24:39I would love to.
24:40Okay.
24:41Look, I understand that this is Gene's first business
24:43after being a rock star.
24:44And I understand the love affair that everybody has with their first business.
24:48But for this business to actually survive and prosper, Gene's going to have to put somebody
24:53else in charge.
24:54So, basically, what's going to happen here is I'm going to remove myself a little bit from the store.
25:01Michael is going to be general manager.
25:04He's going to be running everything up front.
25:06He's going to be doing it all.
25:08You know, the buck's going to stop with him with customer satisfaction, efficiency of the shop,
25:14my inventory.
25:14You're going to have to deal with me more.
25:16Oh, that's all right.
25:18I'm fine.
25:19I love Mike.
25:20I'm fine.
25:20Fine or it's a good thing?
25:22It's good.
25:22Okay.
25:23With Michael as the manager now, I'm going to step back.
25:25And it's very hard.
25:26It's very hard to step back.
25:27I'm going to tell you something, because I got 45 years of my life into this store.
25:32But Gene's got enough work.
25:33If you could turn the camera around and look at Gene's desk, Gene's got enough work to keep him
25:38busy till he's 75.
25:40Even though we butted heads up till last Friday, whatever.
25:43I still believe we got the best stereo shop on Long Island.
25:46We got the best installs.
25:48And if there's a problem, you can come to me.
25:51Okay.
25:51But just don't come to me with a stupid problem.
25:54You were doing good.
25:55You were doing so well.
25:58You were doing so well.
26:00Okay.
26:01Just back that up.
26:02Yeah, just back that up.
26:03You guys are awesome.
26:05You guys are awesome.
26:06We've been here together for 30 years.
26:07You know what I mean?
26:08You guys can work anywhere.
26:09You don't need to work at Jazz Order.
26:10You can work anywhere.
26:12But somehow, you guys all choose to work with me.
26:15And I appreciate that.
26:16And I thank you.
26:17Now that Michael's the general manager, I have a high expectation that he's going
26:21to drive business through the front door or finding dealerships to do business with.
26:25All while managing the inventory at the store.
26:28All right, let's finish the work, guys.
26:29Let's do it.
26:30Let's finish the shop.
26:31You're disappointed with the bottom line?
26:35Well, yeah.
26:35Like, you're working your ass off for that.
26:38Yes, I am.
26:39Something's got to change.
26:49Gene, you ready to say goodbye to the old jazz floor?
26:52Here it goes!
26:56Coming down.
26:56Michael, I want to walk you through the upgraded QuickBooks that I want to put in the system.
27:03Okay.
27:04I need somebody to track all of the assets, all of the cash, all of the liabilities at all times.
27:09How do you track your receivables today?
27:11Yeah, for argument's sake.
27:13And then I save the paperwork here.
27:15So they send me the check.
27:16I print it out.
27:17But is all that recorded in QuickBooks?
27:19No.
27:19No.
27:19It needs to be.
27:20Okay, that's what I'm saying.
27:21No, I use just this.
27:22So you bring in inventory, you log it into QuickBooks.
27:26You sell inventory, you record it in QuickBooks.
27:29Because all this paper craziness is what leads to things being out of stock, parts missing,
27:35you not feeling comfortable that things are being walking away out the back door.
27:39It's a tracking mechanism.
27:40It's an analytical mechanism.
27:42Yeah, no, we can eliminate a lot of steps.
27:44There's a lot of room for error in that.
27:46There's a lot of steps.
27:47I think when I was 12 and I had my candy business, I had a better system than you.
27:54What are you trying to say?
28:00So part of the reason why I wanted to come here is that I'm looking for margin
28:03expansion for the business.
28:05Is there somewhere we could look at product?
28:07Absolutely.
28:08Yeah.
28:08Can we go into the warehouse?
28:10Yeah.
28:10One of the first moves I want to make is to improve the way the company thinks about inventory.
28:15So I'm taking them to a regional distributor that'll give them access to innovation,
28:20real-time inventory, and much better margins.
28:23Can we pull stuff and just put it on so we understand what we're doing?
28:26One of the side benefits to doing this with Michael and Gene is so I could see how Gene behaves.
28:31This is Michael's first opportunity to step up as the leader, to build that relationship with
28:36the distributor, and to show Gene that he's qualified.
28:38This is a great piece.
28:39And if I'm correct, you came in at a great price point.
28:42It's also the test to see if Gene can zip it.
28:46So I was thinking, you know, the JVC, the Alpine, that those are great.
28:51You got a wireless one?
28:52It's $6.95.
28:54I appreciate Gene getting up in there, but I think you have to remind him not to go back to his old ways.
29:01He's doing it right now.
29:02I don't want to spend the extra money.
29:04What I would ask you to do is politely say to him, listen, Gene, I'm going to handle this.
29:12And then I would ask them, what other things do you guys recommend?
29:16What are you seeing?
29:17What's new?
29:17What's innovative?
29:19I want to pull from their knowledge.
29:21So go ahead and jump in.
29:25So what I was thinking was what the client base has been looking for,
29:30and see if they can give us some recommendations on what the best, you know, options are for us.
29:37That's fine.
29:39Friends, between having just a regular BT screen.
29:42Let him make you see what categories are emerging.
29:45Come here for a second.
29:46What's hard for you about this?
29:48Letting go.
29:48What's hard for you?
29:50Because I'm a control guy.
29:51I put 35 years of my life into it.
29:55It's like you walking away from the camp world after you did all that.
29:58So here's the thing that I learned.
30:00Tell me.
30:00My own advice.
30:02For years, I thought I was the only person that could do anything there.
30:05Okay.
30:06And what I learned over time is that when I brought in people that were so much smarter than me,
30:11they had a different perspective than me.
30:14They approached people differently than me.
30:16The business actually flourished more.
30:18I think it worked.
30:19And my job was to organize and collect all the smartest brains in the world to run the business that I had started.
30:29Mike is going to be your sales guy?
30:30Okay.
30:31I appreciate the fact that you're letting Michael represent your business.
30:35He's going to place the order.
30:37You're going to take a deep breath.
30:39Okay.
30:39Perfect.
30:41Mike, just so when we're done, we just pay.
30:43Yep.
30:44Okay.
30:44I want Gene to understand how committed I am to improving his business with him.
30:50And paying for the inventory right now is a good way to make a good faith effort towards that.
30:55But I want to see how they handle it.
30:56It's the final step in determining whether I even want to do a deal here or not.
31:00Mike, I look forward to working with you.
31:01Thank you so much.
31:03Now that Michael's taking control of rebuilding the inventory,
31:06I want him to develop new relationships.
31:08So I'm taking him to a local dealership so I can see how he performs.
31:14Hi, Aaron.
31:15Hey.
31:16Michael, Aaron, how are you?
31:17I'm Marcus.
31:18I've been running this dealership for 12 years.
31:20We don't even know all of the services and accessories that you guys provide.
31:24So we're going to put a marketing deck together that gives you everything that we believe we can provide to you?
31:30Yeah. You give us a fair price and make it quick, easy, and efficient, we're all in.
31:34I'm going to teach Michael how to use technology to actually understand who his whole customer base is.
31:42Salesforce is a technology platform that will allow Michael to understand every single customer that walks through the door,
31:49how to manage the account, how to communicate with them, and how to get the most out of that relationship.
31:54Bye. Thank you.
31:55I have to be honest, I think the space looks really good.
32:08One of the benefits of Marcus coming here was getting everybody to work together to refresh the store.
32:15We tried to make it, like, more inviting.
32:19I love the way it turned out. It feels so much better.
32:21It feels like a whole new store.
32:23You guys have to move back a little bit, because I'm going to show you what's behind the curtain.
32:29One of the things that I think is important is that a business never forgets where it started,
32:34and it understands where it's going. And with Michael being the general manager,
32:37and the shop being cleaned up, and new inventory coming, it's a fresh start.
32:41But I also think it's important to recognize the work, Gene, that you've done to get us here.
32:47And whether there was twists in the roads and bumps in the road,
32:50you still have had a business that's lasted for a long time.
32:54And I think a lot of people dismiss the fact that a business can last for 25, 30, 35 years,
32:59despite all of its dramas. So I'm going to show you something that I hope you enjoy.
33:06Okay.
33:06You ready?
33:07I'm ready.
33:08Oh, Mike.
33:27Who's that good-looking guy?
33:28Awesome.
33:29That is awesome.
33:31Marcus, give me a hug.
33:33That is awesome.
33:36Nobody he loves more than himself.
33:37Look at Gene.
33:38He's always showing people that picture.
33:40Which one?
33:40Look at me with the hair.
33:41Now everyone's going to see it.
33:42The big one.
33:42They always say, that's not you, and then I got to show them my tattoo.
33:45We believe you.
33:46You don't have to take your clothes off.
33:47We're good.
33:48One of the things that I wanted to accomplish,
33:50in addition to paying homage to your past...
33:53...is that if this is the sales counter,
33:55and people are coming in, this is a conversation starter.
33:59It shows that you're in the business that you believe in.
34:03Him and the rest of the guys are going to lay out the floor.
34:05Okay.
34:06The three of us are going to go next door to the bagel store.
34:09I want you to bring your financials with you.
34:12Okay.
34:13Print out like last year's numbers.
34:14Okay, fine.
34:15Okay?
34:15I can do that.
34:16Let's do that, and then we're going to meet next door and sit down and talk a little turkey.
34:20Talk turkey?
34:20Okay.
34:21I don't like turkey.
34:22Too bad.
34:23Yes, you do.
34:24Now that I've spent time with Gene working on the people, the process, the product,
34:29it's time to sit down to really understand, is there an investment opportunity here?
34:33And what I'm thinking about is the kind of deal that would be unlike anything I've ever done before.
34:39What's the business need besides the people, process, and product?
34:48Profit.
34:49It needs money.
34:50It needs some money.
34:51It looks like last year the business did almost 900,000 in sales.
34:56Mm-hmm.
34:57Uh, $239,000 in gross profit, so that puts the margin at around 27%.
35:07Total expenses of $190,000 against $239,000 in gross, and a profit of $48,000, call it $50,000.
35:18Not a lot of money in the bank.
35:20No, not too much.
35:21I'm going to put some money into the store.
35:23He made $50,000 this year?
35:26The company did.
35:28Really?
35:29That's it.
35:30You're disappointed with the bottom line?
35:32Well, yeah, like, you're working your ass off for that.
35:35Yes, I am.
35:37Okay.
35:38Something's got to change.
35:40It's clear to me that Gene doesn't know his numbers, because when I met him,
35:44he told me that his business was doing $1.3 million in sales, and it had profit of $400,000.
35:50That would normally be on the bottom line.
35:51What's your total revenue?
35:53Bring it in, like, one-three.
35:54And on the bottom line?
35:57What, net profit?
35:58Yeah.
35:58$400,000?
35:59$450,000?
36:00What Gene misrepresented is that he meant gross profit.
36:04That's the number right underneath the revenue number.
36:07Then there's all the expenses, and then there's the bottom line.
36:11The bottom line is not $400,000. It's $50,000. And I'm going to maneuver my offer around $50,000,
36:18because it would be worth way more if it actually made $400,000.
36:23How much is the inventory that was just purchased?
36:25Right now, I think you spent about $30,000. I think I didn't see the receivables.
36:30I think between what I wired and what I put on my cart, it's close to $50,000 now.
36:35Right. You might be close to $50,000.
36:37That's how much I have in.
36:37Right.
36:38I'd like the $50,000 to stay in the business that I put in the inventory.
36:43Well, that's very kind to you.
36:45And I'd like to have some equity for it.
36:47Okay.
36:49Um, I'd like to think about that.
36:52You'd think about it right now.
36:54No, I can't make a decision that quick, Marcus.
36:56I'm not to be disrespectful. I'd love to have you as a partner. I'd love to do it.
37:00Well, I made the decision to put the $50,000 in.
37:02You did.
37:03Because I knew that the business needed it, and I knew you needed it,
37:07and I knew the people that work there needed it, and I didn't even hesitate.
37:11I can make the argument that you did it because you wanted to help a small business.
37:14I don't do anything in business for charity. I don't believe in handouts.
37:20So basically, you want a piece of my stuff.
37:22Well, I put money in.
37:23Right. You want a piece of it. Right. That's fine.
37:25I put money in.
37:25I got it. How much equity are you looking for?
37:28What's the $50,000 that I put in worth?
37:3110%.
37:33So the business is worth $500,000?
37:35My business took 35 years of my sweat and blood to get it here.
37:39You know, you gave me $50,000. I'll give you a $50,000 back.
37:43You know, if that's what you want, I'll hand you a $50,000 back.
37:45I got, you know, if that's what it takes, that's what it takes.
37:47But I'm not giving up half my store for $50,000.
37:53It took 35 years of my sweat and blood to get it here. But I'm not giving up half my store for
37:58$50,000. Did I ask for half? No.
38:00But I'm just... Then why would you accuse me of asking for half?
38:02You reacted to me as if I was reaching into your pocket trying to take something from you.
38:06I don't, I think that's wrong. I don't think so. I just said $50,000.
38:09I'm telling you how I perceive it. It's the same way your people perceive it
38:13when you tell them to sit their fat ass down or get off their fat ass.
38:17You go from zero to 100 really fast instead of just taking it slow and having a dialogue
38:24and just talking about it. So now I'm asking you, what is everything that we've gone through
38:29plus the $50,000 worth you? Because the $50,000 is just money out of the account.
38:35Yeah.
38:35The time that I spent with you and the things that you say that you've learned from me
38:41have to be worth $50,000.
38:42100%.
38:43Okay. So do I get any credit for flipping your ass like a pancake and getting you to think a different way?
38:54Well, okay. So I'll go up to 20% if you're interested.
39:00Is 20% something you could live with?
39:02100%. Love to have you as a partner.
39:04Okay, great.
39:05Love to have you as a partner.
39:06Yay!
39:07Fantastic.
39:07Can we go talk to your team?
39:09Sure.
39:09Okay.
39:12You know, I don't like making spur of the moment decisions. I don't do that.
39:15I didn't want to lose the deal. And I believe he can still bring a lot to the table.
39:19So I believe the 20% I gave up, it's fair.
39:27Why don't you tell them what just happened?
39:31I'm going to give Marcus so you're going to team up.
39:33You're not giving me anything.
39:34No, Marcus bought in.
39:38Marcus now owns 20% of jazz audio.
39:41He's coming aboard.
39:42We did make a deal for me to buy 20% of jazz audio. But I like to buy and sell things. So do any of you have any money in your pocket?
39:54Do you have a dollar? You got a dollar for one too? Can I have your money please?
40:01$1, $2, $3, $4. I just sold my interest to them for $4. You guys now own my 20%.
40:12Here you go. Today's your lucky day. Richie, Rob, Michael and Juan, you will equally own the 20%, 5% apiece. And no more nonsense about you're the owner and they're the workers. This is your business too.
40:31I'm excited because I think it's always a good motivation to say you're part of something.
40:39I'm glad you did that. These guys.
40:40I like the way you flipped it.
40:41Right. You flipped it and you did an awesome job. There's a pot of gold at the end of the rainbow. We just got to get there. Now we're getting there together.
40:48Well, you guys should actually have a monthly financial review. And Michael's going to help lead that because he's going to have access to Salesforce.
40:58You're going to have all the data that you need to understand how to run the business.
41:01If the business makes $300,000, that's $15,000 a piece extra for everybody.
41:05The more money you guys make, the more money I'm going to make.
41:08That's the right way to think about it.
41:10I said something right.
41:11That's finally, finally.
41:14These individuals who have been with him for 15, 20 and 30 years are the backbone of his business.
41:22And I wanted him to see value. I also wanted them to recognize the value that I see in that type of labor force.
41:29I also wanted the employees to understand that it's your business and your shop and your customer and your inventory.
41:35And when people take an ownership mentality, they have a totally different mentality.
41:40Thank you for giving me the chance.
41:42I appreciate it.
41:43Thanks, Marcus.
41:44Nice meeting you.
41:45Thank you very much.
41:46It's a great investment because it's an homage to every technician that I've ever worked with
41:51since I was a little kid who taught me the value of hard work and a long day.
41:56That was a small price to pay to recognize an audience that I think is underappreciated.
42:03Thank you, Marcus.
42:04Thank you for making our work.
42:05Oh, thank you.
42:07Marcus, thank you so much.
42:08It's so nice to meet you.
42:10By the way, everybody's got my number.
42:12They will when I leave.
42:13If you misbehave.
42:15Oh, give me your number.
42:19See you guys.
42:22What's the business?
42:23A new experience in the pet space.
42:25An organic bedding company.
42:26We created Modi Toys.
42:27Pop insanity.
42:28Gourmet popcorn.
42:29Dry ice depots.
42:30We're a frozen dessert business.
42:31That's delicious.
42:33You don't really know the math of your business.
42:36I disagree.
42:36You've lost a million dollars a year.
42:38Our growth is flattening very quickly.
42:40How much longer can you survive if the business keeps losing money?
42:43Maybe another six months.
42:46I've seen enough.
42:48I don't know who's in charge.
42:49Do you guys think there's an opportunity for me to make money and contribute?
42:53Then I'm your guy.
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