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Taylor Offer and Parker Burr started their multi-million dollar business, Feat Socks, while they were in college. Upon graduating, they received a $250,000 investment from a college advisor in exchange for a 16% share of their company. They recognized that in order to make the company move forward, they needed to upgrade their products, immerse the business with digital influencers and actively promote their business on social media and other digital outlets. Taylor handles the social media and logistical side of their company while Parker is in charge of product development, finance, and digital acquisition.

After securing another investment of $1 million from a single investor in exchange for 10% equity in their company, Taylor and Parker began to hire operational staff such as customer service, fulfillment, marketing, and graphic design. When the company went through $650,000 and $300,000 in inventory, they realized that their business model was not sustainable, laid off their staff and began outsourcing their operation.

When initially reviewing their company, Marcos Lemonis had limited interest in the sock business but was more interested in how they generated over $2 million in revenue selling socks. In reviewing some of the digital marketing strategies that are effective for them, Marcus recognizes that they have sold over $100,000 on Instagram and have a YouTube presence that generates significant traffic for a company of their size. Because Feat Socks does not have retail involvement, it is clear that they understand the influencer game (which is different than understanding digital advertising and marketing).

So why did such a successful digital marketing agency call Marcus Lemonis for help? Their sales are down and they are unsure how to make up 50% of their revenue in Q4 while carrying the financial burden of purchasing inventory. Marcus immediately identifies several problems with Feat Sock’s business model. The first issue is that they have $60,000 in locked up cash that they can’t touch. Another problem is that they have no real plan to try to jump-start their base and drive revenue. He also sees them as more of a digital marketing company than a sock company and they agree.

Marcus suggests that they put inventory on sale and promote the sale on social media explaining that they messed up and need the help of their consumers. Marcus also makes them a bet that if they can generate enough revenue in a set amount of time, he will purchase $10,000 of socks and donate them to people in need. They agree to Marcus’ bet and immediately jump to their social platforms to stimulate sales. Marcus feels that while they have great talent they are very green on the business side of their company. He also is concerned that they are arrogant and cocky even though they are coming to him because they aren’t sure how to make revenue-generating changes to their business.

Although Marcus Lemonis is interested in their knowledge and their company, he isn’t sure that he wants to financially invest in their company outright. In an unusual play, he does create a mutually beneficial business proposition for Feat Socks that will help to perfect their talent. Marcus brings Taylor and Parker in to meet with his business partners to discuss them all coming together to make a digital marketing super team. The purpose of the team is to drive revenue on a selection of brands (which would include Feat Socks) as well as to offer digital marketing assistance to companies who can not afford a large firm.

This new group is called Community and is made up of several key leaders from Marcus’ other brands: Inkka (shoes), Flex (watches), Ellison (sunglasses), and Everkin (phone accessories). Marcus’ business partners Travis and Brad will handle the logistics and sales, his partner Julie will oversee workflows while Taylor and Parker will be in charge of social media and web skills. This model will allow Taylor and Parker to become millionaires without having to buy inventory. Feat Socks agrees to join Community. In order for this group to be successful they have to accomplish three main goals:

  • Prove they can sell the portfolio of products they currently have
  • Demonstrate that they will sell other people’s products that they would represent. They will control inventory, manufacturing, marketing and logistics for other smaller brands that don’t have the ability to do it. In turn, there will be a fee to use those services.
  • Continue to develop new products for Community to market and sell

In order to improve their business skills, Marcus tasks Community with holding a casting call to review new business proposals, as well as to create a digital marketing campaign about Flex watches. The team becomes frustrated during the casting call when Taylor is aggressive and dismissive of most of the businesses that come in to pitch to them, if he doesn’t like something, he simply dismisses it. Marcus becomes frustrated during the Flex campaign when Taylor doesn’t know the product well enough to sell it even though Marcus was very clear on the business objective in this project.

In order to sell a product well you have to know it inside and out and be passionate about selling it. Admittedly, Taylor has always gotten by with winging things–especially when he is not passionate about the product. Marcus shares with him that he needs to focus on product knowledge but Taylor becomes very angry. He tells Marcus and the team that he wants to go after bigger money making products. He asks Marcus if his goal is to raise money for nonprofits or to make Community money. Marcus is very unimpressed with their attitudes and gives them another selling challenge with another product line. Again, they show that they don’t know the product well enough to sell it and that product knowledge is a major issue for both Taylor and Parker.

When Community reconvenes, Taylor again verbalizes that they want to make money instead of helping people. He doesn’t understand how the other businesses in Community make money and he wants to dig into their financials. They want to have access to all of the financial data for all of the businesses because they think that they can run the business more efficiently than the other leaders.

Marcus is frustrated that they are spending time worrying about the other business’ financials when they don’t even have their own businesses figured out and they don’t have adequate product knowledge. Businesses live and die with the people and the product – not the numbers and Taylor and Parker haven’t invested their time in learning the products. The reason that Marcus wanted to work with Feat Socks is that they have a real talent for marketing products. Instead of focusing on marketing which is their primary function in Community, they are focusing on driving revenue and sales, as well as things that don’t concern them, like accounting.

Even after Marcus tried to redirect them back to their primary function, marketing, they still ambushed one of the businesses without warning to try to obtain financial data which was very out of line. When confronted, Taylor becomes irate and says that he wants concrete numbers on their businesses because he feels like his consulting on these other businesses for free. He feels that he isn’t getting anything out of this partnership, although it will solve their inventory and financial issues while expanding their portfolio.

The rest of the Community team is equally frustrated with Feat Socks. The leadership team felt as though Taylor and Parker put minimal effort into trying to market the other brands. They also felt that they didn’t try to learn about their businesses or their products. Although they had potential and were given an opportunity to be part of the digital marketing team, the other business leaders felt like Taylor and Parker never really wanted to be part of the team. All of the Community leaders vote to discontinue doing business with Feat Socks. Marcus Lemonis agrees, citing there are expectations that they will never be able to meet for each other. Taylor and Parker are dismissed from the group and walk away without a partnership from Marcus Lemonis.

In what was one of the more explosive episodes of “The Profit”, social media had plenty to say about Taylor and Parker’s business decisions:

What do you think about this episode of “The Profit?” Would you have done business with Feat Socks? Do you feel that Taylor and Parker were serious about becoming involved in the Community partnership? Leave your comments below!

“The Profit” airs Tuesday at 10 p.m. on CNBC.

Read more: The Profit: HipPOPs Handcrafted Gelato Bars Fails to Improve Process, Marcus Lemonis Pulls Partnership