Marcus Lemonis and the Fishy Seafood Store

Okay, let’s take a look at this one. We finally got the train wreck we have all been waiting for. I know you guys and gals love them.

Background

Swanson’s Fish Market is a 41 year old family business located in Fairfield, CT. It’s currently run by the founder’s son Gary Jr. His wife Sue is also involved to some debatable degree. Their daughter Larissa recently quit her job to come work as the book-keeper for business.

On July the 4th, 2009 the building that housed the original store burned down and all was lost including a full year of operations and income. Today the business is $900K in debt and struggling to become profitable.

Financials

Despite the huge debt Gary Jr. initially paints a bright picture when asked about the store’s financial performance. Monthly sales are over $150K. The fresh seafood has a decent gross margin of 30% while the soups and other prepared meals have a strong margin of 60%. Marcus immediately starts seeing $ signs as he thinks about expanding the latter. On top of that the new building makes additional money by renting out two storefronts to a cafe and burger joint. This income more than covers the mortgage payment.

Sweet! Sure it’s a dull business but Marcus has the Midas Touch and can turn it into another money maker.

Then things start to quickly unravel as we discover that Gary Jr.’s forte is not accounting.

I won’t get into the details but let’s just say that the business is a money losing disaster. It’s so bad that the employees are not only sometimes asked to wait an extra couple of weeks for their pay checks, but at times have to each pitch in a couple of hundred bucks to help pay for inventory.

Now that is the sign a very badly-managed business.

Larissa meanwhile is commuting an hour each way every day to help her parents try to save the business. She appears to be a good book-keeper and is the one who reached out to Marcus for help. Her numbers paint a bleak picture although there’s a mystery to where the money that does come in goes since Gary Jr and Sue’s personal financial affairs are also in shambles.

Showdown: Gary Jr. and Sue duke it out over what goes first: her BMW or his boat.

Showdown: Gary Jr. and Sue duke it out over what goes first: her BMW or his boat.

Growth Strategy

Initially Marcus works on a growth strategy centered around expanding the soup and prepared seafood meals. He envisages remodeling the store to make more efficient use of the retail space. This is all standard Marcus Lemonis growth strategy stuff.  Focus on the high margin lines and squeeze the maximum possible sales out of every sq. ft. of retail space.

It’s when Marcus learns that one of the tenants, the Black Rock Cafe, has not only not stopped making payments but is five (5) months in arrears that the magnitude of the problems really hits home. Five months?!? But Marcus being a tycoon type comes up with a brilliant solution. Pay close attention here. Why not save the tenant by having them convert their cafe into a seafood restaurant that serves-wait for it!–Swanson’s supplied product? Then customers can buy fresh seafood and soups to take home or have a meal there. One of the two cafe partners agrees to this while the other appears to ride off into the sunset.

It Gets Worse

As the show progresses there’s a steady stream of bad news with the worst being that the money-making property is now actually in foreclosure. Marcus also learns that Sue, who rarely shows up for work, is simply not going to trade in her company leased (I assume) BMW for a cheaper car despite the economic hardships of both business and family. Then on top of all that it turns out that Gary Jr. has a boat too. Both he and Sue are, to use the old phrase, like bull-dogs with a pork chop when it comes to their toys. This just infuriates Marcus, as it should. Finally the word leaks out that Gary Jr. and Sue are having their house remodeled in the midst of this financial meltdown. Meanwhile their employees are being asked to wait an extra couple of weeks for their pay and to pitch in for another load of fish.

I’ll just add that insurance salesmen in Fairfield must run and hide whenever they see Gary Jr. a coming. He’s had fires at both his store and warehouse. On top of that his boat got swamped in a storm and insurance has paid for all three losses.

The Offer

Before learning about the foreclosure and boat, Marcus offers to buy the building for $1 million which will go into an escrow account to ensure that it’s not used to pay off cars and boats. The money will allow Swanson’s to pay off all its debts and still have some working capital left over. By owning the property Marcus protects his own money. The deal is finally accepted when Gary Jr. gets an option to buy the property back at some point.

The whole thing then ends with a rather violent argument. At that point Marcus is suspecting that he’s been deliberately deceived and decides to just walk out.

You can’t blame him.

Lessons

-Always keep this in mind: just because someone happens to own a business does not mean that they know how to run a business. This is especially true of the small stuff with $500K in annual sales or less. These “businesses” are normally teetering on the edge of disaster but the owners are too tight-fisted to invest any money into fixing the problems.

-If you are planning to start a business one of the first things you should do is hire a book-keeper to come in and set up your books for you. Then commit to keeping your records up to date. This usually means an hour two on Fridays.

-Don’t try to treat a man like Marcus as if he just fell off the back of a turnip truck especially if the cameras are rolling. He’s going to eventually see what’s really going on and so will Mr. & Mrs. America.

-Sometimes you will come across families where the child is the parent and the parents are the children. Larissa struck me as the only adult in this family. Hopefully she can move onto a less stressful and better-paying  job soon. Her parents need to learn how to fix their own mess.

I didn’t really see all that much upside potential with Swanson’s. Seafood is a commodity which makes it difficult to brand. When you then add in all the nasty surprises that trickled out, it’s no wonder Marcus chose to walk.

By the way, is $1 million the biggest offer Marcus has ever made? I can’t recall although I know  he has made others which came close.

Does anyone know if Swanson’s is still in business considering the bank foreclosed on the property?

Could you be the next Marcus Lemonis?

 

55 Responses to The Profit: Marcus Lemonis and Swanson’s Fish Market

  • What a wonderful way to air out your dirty laundry in public. Poor Larissa had no idea what her parents were up to when she innocently called Marcus. The poor thing probably regretted it afterwards.

  • It would be interesting to see how the business was doing leading up to the 2009 fire or fires.

  • Store fire in July 2009. Loss = 1 M$. Payout = 1.2M$
    Warehouse fire in December 2009. Loss = 30K$. Payout = 225K$
    Boat flood in ?? Loss = 25K? Payout = 75K$?

  • 🙁 Apparently the old workers (shown on tv) are no longer there, and Larissa posted on Google a week ago that they have new friendly faces available to help serve their customers.

  • These people should ditch the fish store and just focus on their most profitable business of having fires and making out like bandits on the insurance payouts. Who are the check writing morons that overpay them like that?

  • After watching Larissa tell a supplier that they can only afford $35,000 to pay off a $55,000 debt, suppliers will know how the company deceives them. From now on all orders should be COD.

    • for the record Marcus was in the corner coaching me on what to say and i dont agree with cheating people out of money like that. we are actually working with someone to pay off all our bills.

    • Mary-anne, it’s not uncommon for struggling businesses (or even successful businesses) to negotiate with their vendors. In many cases, the vendor is better off offering a discount that ensures partial payment than digging in their heels and risking a bankruptcy liquidation that would likely result in an even greater discount and delay. In the meantime, it may give their customer a lifeline that allows them to remain solvent and continue ordering – I would guess that Swansons has written checks for hundreds of thousands of dollars to that business over the life of their relationship. Although it’s not ideal, taking a loss of $18,000 to preserve that relationship and get some money in the bank is probably preferable to the alternative.

  • That looks so suspicious! Two fires, and then another insurance collection of the boat? Looks so fishy! No pun intended….

  • I looked into a few things. MacDaddy’s is a chain of Mac and cheese restaurants owned by the Swanson’s and Robert Dunn. They apparently have expanded to other locations throughout the country. It used to be in the same complex the fish market as of 2010, but apparently left. Would like to know the story behind that….point is, the Swanson’s are apparently in other business dealings that weren’t revealed on the Profit.

    • Ken the MacDaddy’s partners were stealing from business, that is why it is not there anymore. My father agreed to put the last of his saving up to build the place, put over 150k and never got his return. He went to court and won so he was able to break the contract but he never got his money back. That is one of the many reasons why he is in so much debt…if you check our website you can read all about it, thanks and good night

      • I’m skeptical of the presentation that the show utilizes. The admission of the boat was obviously staged. Larissa’s parents didn’t just ‘happen to get caught’ by a camera crew. This was theater.

        Marcus is not a poor little victim. He is a very rich business man. Larissa, please provide a link to your side. Good luck to you going forward.

      • Larissa has nothing to be sorry for or ashamed of, she did nothing wrong. I can completely relate to what she is going through. My brother’s family cheats the insurance companies every year. They cheat on taxes so they can live on food stamps but appear to have plenty of money. If they were in charge, our family business would be gone. Strangely enough they attend church 3 times a week lol

      • Larissa I can’t believe how otherworldly HOT you are. How are you not modeling? Why are you wasting your time there? You are amazing.

        Episode seemed ‘fishy’ though. Looks like Lemonis wanted out, and the parents lied… Larissa caught in the middle.

  • Larissa wrote a lengthy response on their website with docs and texts show the really manipulative editing of this show. It’s shameful and can ruin people’s lives. Honestly I quest ios Ned he editing bc the outfits people were wearing repeated dentically weeks later… didn’t add up. http://www.swansonsfishmarket.com/#!the-profit–please-read/c24el

    • Did Larissa drop out of school before they taught about paragraphs? That’s unreadable.

    • I read your response but it did not change my mind. Your father came across vulgar and crude to me. Who uses that kind of language in front of women? Mom seemed to be a potty mouth too though. Whether the boat was paid for or not it costs a lot to maintain a boat. I thought your dad stated the insurance numbers info so, not sure that is the shows fault. Maybe Marcus would have come through with the money but your dad threw him out and or knew the numbers better? My opinion

  • I thoroughly enjoy The Profit for its entertainment, and for Marcus’ approach of seeing the possibilities in each business. But, I’ve been an entrepreneur and business intermediary for over 30 years buying and selling businesses, and I can’t imagine writing a check, as Marcus does, before doing due diligence on every aspect of the business. It makes for interesting TV but the reality is that no sophisticated buyer would be that impulsive before knowing more about the business and the people he is dealing with.

    • mike he never wanted to do a deal to begin with…his excuse was that he did not want to get involved and in between a family business but they did not show that

      • My comment was directed to the entire concept of the show. I don’t doubt what you said in your blog as it becomes more apparent from watching several episodes that much is staged and edited for audience appeal. News Flash: Reality TV is not so real after all.

        The value of the show in my opinion, is the way the situations demonstrate the need for entrepreneurial training in the fundamentals of running a business. For all the lack of emotional intelligence demonstrated by Marcus in his approach to dealing with the owners his principles of People, Process and Product are sound. If business owners get that from watching the show, it would make the experience worthwhile.

        As a value-building advocate for middle-market businesses I have seen much loss of potential wealth creation in business because the owners lacked an understanding of what I believe is the sole purpose of being in business; to build an enterprise of value that someone will pay you handsomely to acquire.

        As Michael Gerber says; many business owners are technicians having an entrepreneurial seizure. They may have mastered the technical aspects of a craft but don’t understand how to grow a successful business beyond creating a job for themselves. There’s nothing wrong with creating a job if that is what you want. But if you don’t get beyond that you will never create a business of real value to anyone else.

    • If you pay close attention to each episode you discover that Lemonis invariably gets his money back one way or another. It might not be all but in most cases it’s upwards of 90%.

    • Mike he writes the check but can get the money back if the business owners fail their side of the bargain.

      • Yes, but it is not portrayed that way on the show when he makes the offer. Also, at the time of writing the check Marcus does not explain the conditions in which the check is offered. That explanation comes as an aside when he is talking to the audience.

        • So what. He still makes if very clear during the show. No idea what your point is.

          • The point is that the check offer is disingenuous as portrayed since the owners are not always told the conditions of the check on-air.

        • Mike, you are too hung up on the checks. Of course there are going to be some strings attached so that Marcus can protect himself. He’d be stupid to give strangers $500,000 off the top without getting anything back in return such as equity, rights, or at least some demonstration that they are complying with his plans.

  • I have read all your comments and i can see why this entire show came off so suspicious to everyone. Mary Anne i did go to school and added in some paragraphs for you. Please take the time to just read our side that is all i ask, thank you and good night im so tired..

    • Hi Larissa: I read your side and I’m glad you posted some of the legal documents. They are facts, and facts can’t be argued with. I wish you weren’t such a devoted family member. It would be easier for us to discern the truth about the real story if we had an impartial outsider reporting. Having said that, I’m old enough to be cynical of the Press and of media in general. So I’ll now take what I saw on the show with a grain of salt. But regardless of what the truth is about your parents, we’re all agreed here that you were the REAL adult. I know this will sound “chauvinistic,” but it seems you’ll make a fine, responsible wife someday.

      • This probably not the best place to woo her. Besides she has a boyfriend.

        • Not my intent to woo her. I was simply trying to make an encouraging statement, that she will be a fine helpmate for a husband. (You’ll see I posted a modified, second version of my comment when I didn’t see my initial and thought the moderator had rejected it.)

          • A fine helpmate?

            How is the weather back there in 1954? You certainly are a condescending little chauvinist.

    • Hi Larissa: I read your side and I’m glad you posted some of the legal documents. They are facts, and facts can’t be argued with. I wish you weren’t such a devoted family member. It would be easier for us to discern the truth about the real story if we had an impartial outsider reporting. Having said that, I’m old enough to be cynical of the Press and of media in general. (And police reports.) So I’ll now take what I saw on the show with a grain of salt. But regardless of what the truth is about your parets, we’re all agreed here that you were the REAL adult. Once you’re finished taking care of your parents, you’ll probably do well in life.

      • Thanks Kim. (I hope not K.K. whom I once wrote for.) I could say what I think you are. But I won’t.
        P.S. I’m just quoting God in Genesis. Your problem is w/ Him, not me. Amen?

        • You are a gullible one one, Mike. Naive too. You might want to consider saying good bye to the 19th century and stepping into the 21st. You also need to stop being so condescending towards women. It’s a huge turn-off.

  • Marcus is a great guy in trying to help other business and trust their words and a deal on a hand shake. You don’t see too many people doing business like that these days. Although he didn’t check on the title of the business building before the deal he did protect himself in putting the check in an escrow account. It’s all about trust but there is a limit. The show wouldn’t have developed if we weren’t able to follow Marcus on his journey of discovery of the foreclosed building. I like this show especially when Marcus can help and improve a business. But, in some cases like this fishy place ( and it’s not the fish) can’t be helped.

    Hope Larissa can apply what Marcus has shown her in the brief time he was there and apply them in fixing the business. Larissa is the only sensible person and should be in charge of the business to get them out of problems. It’s sad that the daughter should become the parent and curtail the parent’s money spending and bad decisions.

  • In the absence of context, just about anyone can be made to appear inept; or in this case, corrupt. I certainly understand the ratings incentive to dramatize the family’s personal and professional lives; however, it is unfortunate that the production was clearly manipulated to lead the audience to conclude that the Swansons were engaging in fraudulent practices. Meanwhile, Marcus is billed as the doe-eyed victim, despite an intentionally strung-out due-diligence process that focuses on teaching the Swanson family some kind of contrived lesson about their personal spending habits…as opposed to verifying the financial viability of the business in which he is supposedly investing. My guess is that our hero Marcus rolled in to Fairfield for an afternoon of over-dramatized filming about once a month, while the Swansons were in limbo trying to determine if this “investment” was going to come to fruition. Don’t get me wrong, I’m not absolving the Swansons of their responsibility for the condition of the business. I don’t doubt that there was, at the very least, poor decision making and a number of curious coincidences that raise a few eyebrows. That said, I think it’s important to remember that these are real people that have to face real fallout due to the way they were portrayed on The Profit. Oh, who am I kidding…the joke’s probably on me and the whole Swanson family are paid actors.

    • Why shouldn’t he expect people to be true to their word if he is going into business with them? He protects his money and gets it back if they lie so its stupid and embarrassing for them to lie. They should have to face the embarrassment if they lie

      • I guess you have a lot more faith in the virtues of reality television production companies than do I. When they’ve boiled down the four month process to 45 minutes of out-of-sequence, contrived, intentionally-dramatized footage, I tend to take that with a grain of salt. As for Marcus, he didn’t have to “get his money back” – he never actually put it on the line in the first place. Again, that’s not a huge surprise; however, it’s not what they portray on The Profit. Marcus whipping out his check book is pure theatre. Marcus pulling up in the same Chrysler 200 that is advertised during the commercials…what a coincidence! If you think that the camera crew is just there rolling as Marcus and the Swansons go about their negotations, I have some beachfront property in Arizona I’d love to sell you. I have no idea whether or not the Swansons lied to Marcus, but I do feel it’s a pretty serious accusation to leave hanging out there as the episode draws to a close – one that obviously has real implications for the Swansons and their business.

        • “I got some beach front property in AZ to sell you” Possibly one of the most tired overused phrase as witty as you think it is. You wrote 2 long rambling paragraphs about the show without really making a point

          • He’s point was clear to me. The show distorts & he felt Marcus was wrong for stringing them along

        • Marcus clearly states the money goes into escrow

  • I feel for Larissa. She’s trying her best, and believes in her family. She should be applauded for that kind of loyalty and trying to help the family.

    And yes, I think Marcus was in this one for some drama, but I also think if you were an outsider looking in, you’d see a lot that’s wrong. This family has a dark cloud over it. Fires, stalking, lawsuits, etc. Every issue there’s an explanation. Every explanation there’s an issue.

    Yes, personal tragedies seem to follow the family, but not paying your vendors, or not paying staff on time when you expect them to be on time, yet having a boat and a bmw, both of which require cash seems like you have your priorities in the wrong places. If your business is failing, you give up everything to fix it and make payroll. That wasn’t happening here, all reasons aside, all stories aside.

    Larissa should just move on. Her family will eventually cause her to have a nervous breakdown. There’s a reason why she moved an hour away. She must know on some level this family is pretty toxic. It wasn’t the staged drama, it wasn’t the fake smoking gun Marcus found. It was the way in which the parents acted and reacted. That wasn’t staged or fake it was just pure dysfunction.

    Larissa, you didn’t cause the issues, you didn’t create the mess. Get as far away from your family as possible. They will bring you down. You have a lot more going for you. You can’t pick your family, but you can pick what you do with your own life.

  • Larissa,you are beautiful!!!

  • Gordie, thanks for your contribution to the discussion. You can now go back to creeping on chatroulette and omegle. Larissa, I read your post. I have always known editing plays a huge role in “reality TV” and it’s usually about as “real” as a three dollar bill. I also sympathize with your family regarding bad things that have happened to them which were out of their control. But I need to ask you a very tough question…. (and it probably makes a left turn in this discussion to more of a morality tale in what is happening today regarding people and how they perceive/wish to be perceived by others…. but)…. if you could be honest with an answer it would be appreciated: When you originally contacted the show, how much did you think about how fun and exciting it would be to be “on stage” and be a reality TV “star”, even if only for a short time?

  • Larissa,

    Time to stop lying and ranting and fessing up to your family’s BS. Ditch the Connecticut sense of entitlement and pay your debts.

    He did not film for months as you state and gave you a beautiful interior while ignoring your father’s drug habits and mother’s laziness. No excuses.

    But good luck to you all!

    • I agree with Sam H. Besides, they can edit and stage whatever they want.. the characters of the parents were real and utterly disturbing (to say the least). I would have walked away only because of their rotten (fishy) characters. Come on..

  • Hi , I am not in a position to know what is or is not true . However , if you watch shows like Hardcore Pawn , & see the people behaving like entitled savages , one can only hope that this is a made up thing for the show . Otherwise , society has degraded past where even I thought it was .

  • Honestly, Larissa, the fact that you have to vehemently defend your parents for them instead of them doing for themselves tells me how your parents were presented somewhat truthfully.

    You are still trying to clean up their messes for them and you are the child acting like the parent yet again. Your mom is slacking and you are slaving to do what she should have been doing.

    Have you ever heard of the word Narcissist? They spend like there is no tomorrow and yet,they can’t pay their employees in a timely manner? That is incredibly irresponsible and extremely selfish of them. Those employees were incredibly loyal and dedicated and now they are gone?

    I wish you the best of luck sweetheart. You deserve it.

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