A lot gets written on "teaching kids to invest." Before you skip ahead to teaching your high schooler what P/E ratios are, remember that investing is buying into part of a business. For most people understanding businesses is an abstract concept at best. But learning how businesses function is very educational, not just for those specific businesses but indeed how much of the world functions.
The Profit focuses on businesses that are up against some kind of threat, perhaps liquidity or product or customer or legacy issue. The Profit aka Marcus Lemonis, goes to great pains to point out that he is not a consultant, but he clearly has learnt the old consulting rule of thumb - its never process problem, its never a tech problem, its always a people problem.
The shows give you a slice of life in a wide variety of businesses from Key Lime pie companies to auto sales to coffee roasting and a lot more. What the show excels at is quickly getting a clear picture as to the value (if any) that exists in the company, and then efficiently figuring out where the blockers are. The main lens is people, process, and product to slice and dice where the strengths and weaknesses are. But its the people that must be genuinely convinced to participate, both the business owners to do the deal and Marcus Lemonis that the deal is worth doing.
So much of business is taught (and practiced!) as a bloodless operation, I think that's a real turnoff, sure numbers matter, but unless the people side is working you won't get the numbers over the long haul. Real world business is incredibly personal. The show does a great job showing the human side, good and bad, of business.
As we're still in the middle of the uneven post 2008 recovery, its especially fraught with emotion and meaning as you watch business owners fight to save their creations and employees fight to save their jobs.
There are a lot of great lessons embedded in the show. Some that stand out:
- Find diamonds in your backyard - a recurring theme is employees going to heroic lengths to keep businesses rolling. This happens in a lot of small businesses (and all successful ones), what's missing often is that investment in people will pay off more than any other
- Know when to say no and walk away - its easy to get swept up in the dealmania, only look at the upside, but some deals just do not make sense
- Be decisive - small businesses do not have layers and layers of bureaucracy, its all hands on deck. Whether its chucking old merchandise that won't sell or closing stores that don't make sense, tough calls have to be made and acted on efficiently
- Simplify then scale - a number of the businesses have solid cores but extended in too many directions at once. Marcus Lemonis leads the businesses through a process of simplicity first. There is a good episode on a South Carolina Barbecue restaurant with huge customer demand. Instead of adding another location, Marcus Lemonis has them get one location right and then plan to scale from there. Walk in to a Chipotle, the menu could not be much simpler. I recall interviews with Chipotle CEO/Founder Steve Ells when they became successful asking him what is next? Breakfast? Late night? Bigger menu? Ells replied 'we are not going to do any thing new. We are going to do what we already do and we are going to do it better.' In software development we say "one is more than none" don't overengineer out of the gate. That's a crucial business message that comes through in many The Profit episodes.
There are other business shows on TV, but none that get to the heart and head of business. Shark Tank can be fun, but its too often a bloodless VC conversation and while its fun to see all the different business ideas, you do not get the day to day operations or any visibility into the people that make the business tick. Here again The Profit gets to the heart of what matters.
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