New episodes of Marcus Lemonis's show 'The Profit' premiered on October 14th and the second episode will air tomorrow night at 10pm ET/PT. Since 'The Profit' first premiered, Marcus Lemonis, Chairman and CEO of Camping World and Good Sam Enterprises, has invested more than $7 million of his own money in the companies featured on the series.
Marcus Lemonis leads close to 6,000 employees in over 100 cities across the US. He started the company after realizing the RV industry had potential for growth and bought more than 100 RV companies from “mom and pop” dealerships across the country and turning them into Camping World RV SuperCenters. Combined with Good Sam Enterprises in 2010, the consolidated company will record close to $2.5 billion in sales in 2013. RV Business Magazine named Marcus as their 2007 Newsmaker of the Year. In addition, Crain’s Chicago Business featured him in their 2005 edition of “40 under 40”; and in 2008, Ernst & Young named him Entrepreneur of the Year.
In the following interview, Lemonis talks about lessons he learned from last season, how he handles family dynamics in small businesses, which of his investments he most regrets and more.
Dan Schawbel: What have you learned so far from your experiences in the last season that helped you for this new season?
Marcus Lemonis: I learned that I need to ask more detailed questions, particularly in the first two days of filming when the participant is a little more nervous and a little less open. That if I don't dig for the answer, I may get half the answer, which ultimately leads to a misunderstanding at some point in the future.
Schawbel: How have you learned to best handle the family dynamics of these small businesses? Why is it typically that the people get in the way of their own success?
Lemonis: I have a lot of experience in dealing with them and have been dealing with them for years. It's truly not any different. It's sifting through which family member actually contributes to the business and treating them the same way I would if they were productive. But if there's a family member who doesn't contribute to the business, you have to handle it the same way you would for an unproductive employee. Understanding that a change, dismissal, hire, or pay plan shift definitely has an impact on the other family members.
I don't know if people consciously get in the way of their own success. In fairness, people have a lot of pride and they fall back on what they know to be safe and correct. Anybody, including me, struggle with change. I think it's a misconception that they are getting in the way of it and that they are just comfortable in what they've done and they have pride in authorship. In some cases, I like how they fight back because it shows they have a vested interest and passion for what they're doing.
Schawbel: You're really good at asking the right questions in order to access a business. What are the most typical questions you ask and what can you learn from the responses that can help you solve their problems?
Lemonis: Usually you can figure out where a persons mistakes came from if you ask them the genesis of their thought process. Why did you do it this way? As opposed to telling them they did it the wrong way. Understanding their thought process will ultimately help you be able to communicate with them and navigate around them. Then teaching them that their thought process could have been done differently, feels more constructive than destructive. Understanding why it is that people did things a certain way is the most important question.
Schawbel: Do you regret any advice you gave last season or any investment that you made? If not, what advice do you wish you gave one of the companies that you didn't?
Lemonis: I regret the Pro Fit investment because I didn't know that I was dealing with people who were more concerned about the exposure than fixing their business. Recently, I've been able to get them re-focused on their business but for the past six months I've spent a lot of time arguing about why they weren't spending time on their business. Out of all the deals I've ever done, that one is the one that I regret the most.
I should have been stronger with Pete Athans, which was episode one, AutoMatch. I should have encouraged him to go find a different career earlier on as opposed to trying to think that he was committed to the car business. He was committed to the glamour and idea of the car business but not the work that's required to make it happen. Today, he's no longer with the business but I have a relationship with him and he's happier because of it. I should have been firmer earlier about him not being in the industry.
Schawbel: Which companies are thriving from last season and which ones aren't? How well are the companies doing from this new season and what are your accomplishments?
Lemonis: From last season, AutoMatch is doing very well. Amazing Grapes is doing very well. Sweet Pete's is doing very well. Key Lime Pie Co isn't doing terrible but it's still struggling and we're converting it to a Crumbs down in Key West. Pro-Fit is doing OK but I've kind of checked out on it. Stein Meats is out of business.
It's a little too early to tell in this season because the time between airing the show and finishing the filming is less than thirty days. Early signs are, with the numbers Courage b is doing pretty good but more importantly their margins are up from 50% and are now over 80%.
Dan Schawbel is a speaker and best-selling author. Connect with him on LinkedIn.
