Marcus Lemonis Vs COURAGE b
The Company: COURAGE b
The Owner(s): Stephanie Menkin, Nicolas Goureau and Designer Noemie Goureau.
Welcome to the review of this weeks’ episode of the profit. In this episode, Marcus Lemonis visits Courage. b, a family run high-end women fashion business located in 6 stores across the USA. It was founded by the Goureau family in 2008 and it has been catering to the upscale sophisticated fashion market ever since. Its’ daily administration is run by brother and sister Nicolas and Stephanie while their mother Noemie is the chief designer.
The business has fallen upon hard times in the last 2 years thanks to lousy decisions, bad management and poor execution. All these have pushed the family into a lot of frustration and quarrels.
If the Goureau family can’t get things back together and pull the business out of the deep financial hole it is in, there will be no Courage b left in the end for any of them.
With over $5,000,000 in annual revenue and 50% margins, the company still manages to lose $500,000 a year. Can Marcus come in with his 3 Ps (People+Product+Process) and save the day??? We’ll find out.
Marcus arrives at Courage b to find it in a state of chaos. The products are badly placed in the store, Nicolas ( “the GENERAL” of the business) can’t wait to shout on his mom, tell her how useless she is and how her designs are not performing well.
Looks like the family drama was caused by the passing of the father when the kids were still little. Noemie remarrying and then getting divorced and sued by her now ex-husband put a deep financial and emotional strain on the family and caused deep friction between mother and son. Nicolas is punishing his mother for the mistakes she made in the past.
Marcus finds out that business owns 6 stores, one of which is called Fopps located in Manhattan. This store belonged to the designer and mom Noemie but started on losing a lot of money. Noemie stepped down from management and focused on just designing the product line. Fopps with a shop rent of $28,000 per month is a big money loser and is draining Courage b’s finances.
Here below is an interesting video interview about Courage b from mosaic.
Problems/Issues In The Business Found By Marcus
- Huge family tension and frustration.
- Mis-management of the business.
- Noemie disrespected and mistrusted as a mother by her son.
- Too much control of the business by Nicolas
- Bad product and placement in the shop.
- Too many products in the shops with no focus on the clothing line.
- Huge loses in the business.
- Design inconsistencies.
- Bad inventory, fit and finish.
Marcus sits down with the Goureau family to offer a deal. Marcus is sure that with a few tweaks with the products and cutting down huge costs, Courage b can become a highly profitable business. He offers them $800,000 for 50% of the business. Nicolas replies NO.
Marcus tells them he wants to have skin in the game so the percentage has to be worth his while. He will pull back on the equity if control freak Nicolas gives equity to his sister Stephanie and his mom Noemie.
He offers them the $800,000 for 30% with Nicolas having 40% and his mom and sister both having 15% equity each. Nicolas accepts the deal and his mom and sister are excited they finally have a part of the business they put their sweat and blood into.
Remember, this is the profit and Marcus is 100% in charge of the business for the period of time needed to turn it around.
Solutions Suggested/Implemented by Marcus To Improve The Business
- Resolve family drama.
- Add working capital to the business.
- Pay off debts.
- Renovate and totally overhaul the look and feel of the stores.
- Increase business margins by increasing the quality of the products and retail price.
- Synchronize the stores merchandising to give clients the same shopping feel in all the stores nationwide.
- Full business re-brand and planogram system to be implemented.
- Increase standards with fit and finish of the clothing line as well as the quality of fabrics used to make them.
- Streamline the product line and get rid of unsuccessful products.
- Hire new fashion designers to help Noemie in expanding the product line.
After The deal…
As hands shake on the deal, Marcus gets to work on renovating the stores and re-branding. The stores will finally have the same exact high-class look and feel consistently throughout its locations, exactly like McDonald does in its locations around the world.
There also has to be a collection of clothes Courage b will be known for. There will be only 5 specific product types carried in its stores.
- Pants or trousers for our non-US visitors :)
So merchandise is liquidated, the stores are closed down and renovation begins.
Conclusion and Updates on the Business
After another quarrel between Nicolas and mother Noemie, Marcus pulls him aside and helps him overcome his sadness and frustration about his fathers’ death. This I am sure is the root of all the conflicts in the family.
Marcus tells Nicolas that Noemie is his mother FIRST and employee LAST. Mother and son make peace and we all hope Nicolas takes this advice from Marcus for the rest of his life.
After renovations and modernization of the first Courage b store, it looks fantastic. Marcus really has an eye for fashion and design and this may be the best transformation I have see on the profit so far. The Fopps store in Manhattan was re-branded and is now Courage.b.
The Goureau family is ecstatic about the new store and brand. I am also. Marcus got this spot on.
On the grand reopening of the first store, it’s full and sales start to pour in.
Marcus is so impressed that the family could change their ways and come together to move the business forward. I will be looking for updates on the business and will post them here as soon as I find some.
Thanks for visiting and I hope you liked the review. Let us know what you fell about this Courage b episode, the business and its’ characters by commenting and joining in the discussion below.
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>> Visit the next episode Artistic Stitch Queens Vibe – The Profit Season 2 Episode 10