Southern Culture

This week, Marcus Lemonis travels to Atlanta, Georgia to help Southern Culture, a packaged food company struggling with sales and cash flow. According to CNBC, the breakfast lifestyle brand “is drowning in debt.” If Lemonis cannot help, then the problems facing the all-natural food business could become a recipe for disaster.

Visiting the 3,000-square-feet warehouse, Lemonis meets owner Erica Barrett and her mother Lamarinette. He then notices that the flavor lineup is a bit disorganized. The business did $500,000 in revenue last year, mostly from the pancake and fried chicken mixes. He tries some of the flavors next and says they’re “delicious.”

Erica’s husband Andre then shares some of his business concerns and tells Lemonis how he basically gave up at one point. He says he wants to see profitability and when he doesn’t, he loses interest. Lemonis thinks he needs to be more openminded after Erica becomes emotional about whether he really supports her dreams.

After reviewing the financials, Lemonis decides to invest on one condition: “If you can prove to me that you could have financial discipline and the inventory, the assets all get sold off and every debt gets paid down, paid off or a payment plan is put in place.” He offers $75,000 to rebuild the business, which she accepts.

Lemonis and Erica visit Kroger next to see the products on the shelf. They are located in the “Latin American foods” aisle, with hopes to get into the national food area. He tells her that the offerings need to be more cohesive and challenges her to develop new southern food mixes.

Then, Lemonis, Erica and Andre visit the storage shed, which contains kitchen equipment, computer routers and even a bicycle. Andre says she needs to “be more strategic with your money” and calls everything in the shed “a waste.” Lemonis is troubled that he’s so critical of the business and says Andre’s punishment comment directed toward Erica is “f***** up.” He acknowledges that Andre has financial literacy, but says Erica’s strength is her creativity.

They switch to liquidating assets next and create a Facebook Live video to help move product. Erica also generates money from selling stuff from the storage box. In two days, they sold $12,000 worth of inventory and negotiated off some debt.

The group then takes a trip on Lemonis’s plane to Madison, Florida, where Lemonis introduces Erica and her mother to celebrity chef Art Smith. They quickly encounter problems, however, when Erica becomes annoyed over the fact that “too many” chefs are in the kitchen trying to take control. Lemonis encourages her to try to give up some control and be open to new ideas. A group of locals tries the chicken next and they all have very positive feedback. The group also calls the cornbread mix “phenomenal,” while another person calls it “authentic.”

Erica and her mother then work on product development at a co-packing facility, where an executive says the package reminds him of ice cream and adds that there are some problems with the design. Lemonis is worried about a lack of consistent branding and finds that Erica is still unwilling to relinquish control.

After being given an update on the financials, Lemonis is impressed to learn that Erica eliminated much of her debt and says she can cash the check. He wants 50.1 percent of the business, but she wants to keep at least 55 percent. However, she ultimately agrees to the deal.

The new lineup is then presented, which includes mixes centered around breakfast, spice blends and baked goods. She also worked on new designs and Lemonis is very impressed that she is learning to be more collaborative. Two weeks later, Lemonis likes all the progress that has been made. He then offers 17 percent equity for Erica’s mother so that she can also have a stake in the company.

In Brooklyn, New York, Lemonis and the Southern Culture trio then visit, a food subscription business. Erica pitches to the team, who then tries the food, which includes biscuits. They like the texture, but some are concerned about the spice level. They like the idea of a pepper packet that can help regulate the spice. The Mouth team also likes the pancake and cornbread mixes and hope to feature the mixes in the southern foods section.

Ultimately, Lemonis is impressed with the company’s progress, to which he credits Erica and her mother. Thanks to gaining an expanded category in Kroger and being in final discussions with WalMart, he predicts the business could do $1 million in the next year.

See how social media reacted to Southern Culture on “The Profit” below:

Social Media Reacts to Southern Culture’s Appearance on “The Profit”

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

What are your thoughts on Southern Culture and the owner’s initial hesitation to relinquish control? How did you feel about Erica’s transformation throughout the episode? Sound off in the comments section below!

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