Aspiring entrepreneurs, and every person working in any business worldwide, can learn a lot from watching all the interesting real-life case studies on The Profit.
Marcus Lemonis, a self-made American billionaire, makes his money by partnering up with struggling businesses who ask for his help. He is not a consultant; if he decides to invest in a business, he gives the business an infusion of cash in return for a large percentage of ownership, and with the understanding that going forward, HE is the one IN CHARGE of ALL BUSINESS DECISIONS.
Some of Lemonis’s investments do work out, and some of them don’t. His television program follows him through the process of meeting the owners, investigating the business, and deciding what deal (if any) to offer to the business owners. Subsequent follow-up programs, a year or two later, let viewers know if, or how well, these various investments have worked out. If they have not worked out, we are able to learn the reasons why.
In a nutshell, Lemonis has broken down the functioning of a successful business into three areas: people, product, and process. Normally, he has to feel that he is able to trust and work with the people in the business, that they have the proper skill-set, and the proper attitude to be able to adapt going forward. Next, Lemonis analyzes their products and their markets, to determine what changes, if any, need to be made. Usually, he is looking at a business in terms of whether it is scalable to a national level in terms of expanding profits. Next, he looks at the processes the business has in place.
The reason Lemonis specifies in his agreements that HE WILL BE IN CHARGE GOING FORWARD, is that sometimes current owners don’t like, or agree with, the changes he wants to make going forward, in terms of product, or process. Sometimes he reassigns team members into different or specific areas of responsibility. Other times, he redesigns the product lines and marketing strategies. He often makes changes such as revamping the factory floor, or redesigning the menu or cooking processes. He always explains his reasons for the changes he is making.
In the investments which don’t work out, it’s generally because the partners involved were dishonest with him, withholding crucial information such as outstanding debts, or in some cases even stealing from business, helping themselves privately to business funds. Other times, the partners agree to changes, and the minute Marcus goes away, they go back on their agreements, returning to their previous processes and products–thus wasting all the money and time Marcus has invested, frittering away the new investment funds. In a few cases, the partners have come into the deal with the intent to defraud Marcus. In some cases, the business owners want Marcus’s cash, but are lazy people with no intention of making the business a success going forward.
In the investments which do work out, the business owners are honest, hardworking. They have the right skills and experience, or are willing to upgrade their skills, or make whatever changes are necessary. They are not resistant to Marcus’s changes, and they support his changes going forward. Generally these businesses become very successful and even evolve into national chains.
For viewers, employees or employers, and aspiring entrepreneurs—all can learn extremely useful life lessons in an interesting and entertaining way. It’s easy to identify with Marcus. We want him to win because he’s a really decent guy who looks for win-win solutions to help ailing businesses, and to help employees of these failing companies to keep their jobs.