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Kensington Garden Rooms – The Profit Season 3 Episode 12

Updated on February 18, 2016

Marcus Lemonis Vs Kensington Garden Rooms

The Company: Kensington Garden RoomsKensington-Garden-Rooms

The Owner(s): Damion Merry and Simon Johnston

Website: http://www.kensingtongardenrooms.com/

Intro

In this episode of the profit, Marcus Lemonis visits Kensington Garden Rooms. Kensington Garden Rooms is a California-based custom gazebo company owned by two British co-founders Damion Merry and Simon Johnston. The company was established in 2012 and was turning profit designing, building and selling hand-crafted cedar gazebos.

Kensington-Garden-Rooms-old

But Kensington Garden Rooms has a price of more than $30,000 per product, Simon and Damion were excluding a big chunk of the market and leaving money on the table. Their arguable relationship was threatening the future of their business. Marcus believes that his help will make the business better and more stable.

Kensington-Garden-Rooms-old-shop

Marcus was disappointed to witness the co-owners bickering who work more. He checked the finances with them and their third business partner, Kab Benefield. Marcus was concerned with their idea to expand quickly. Damion broke down. Marcus posted a challenge for Damion, Simon, Kab, and Jack Owen, the carpenter. He wanted them to have a professional business plan and improve their business process after three (3) weeks.

Problems/Issues In The Business Found By Marcus

  • Damion and Simon keep on finger pointing.
  • Kensington Garden Rooms has no sophisticated process.
  • The company’s location is not very accessible.
  • The workplace/warehouse has no air-condition and ventilation.
  • No working rest rooms.
  • There was no enough money and space.
  • There was no business plan.
  • There was no inventory.
  • Kensington Garden Rooms’ owners wanted to expand too fast.

The Deal

Marcus sees some good in the future of Kensington Garden Rooms and he recognizes the efforts of Simon, Damion and Jack. During the meeting, he uttered his disappointment that Kab has 1/3 equity when he is not as involved in the day-to-day operation. He offered two (2) deals.

Kensington-Garden-Rooms-after-3-weeks

The first offer was $150,000 for 12% of Kensington Garden Rooms, but the dilution has to come from Kab’s ownership. The second option was to put $150,000 to buy out Kab’s ownership. Marcus included one condition to the deal. Jack should own 10% of the company. Everyone agreed to let Marcus invest $150,000 for 12% ownership and total control of the company.

Kensington-Garden-Rooms-deal

Later, Marcus learned that Kab was unhappy with the deal. He offered him $250,000 to leave the company. But Marcus has withdrawn his offer when Kab demanded more money for his son. They returned to the original deal.

Solutions Suggested/Implemented by Marcus To Improve The Business

  • Damion and Simon settled all their differences and trust each other more.
  • They organized their old workplace.
  • They looked for a new warehouse to rent.
  • They improve the assembly line and process.
  • Sufficient funds.
  • There is a professional business plan and the business has a clear goal.
  • A new inventory system was in place.
  • New tools and equipment are purchased.
  • The owners decided to improve and strengthen their business instead of expanding.
  • They do Mass Marketing, Target Marketing, as well as Commercial Companies.

During The Show…

To make things better and find bigger opportunities, Marcus brought Damion to True Value Chicago to promote Kensington Garden Rooms. They are both hopeful that they will get a deal. True Value was interested and would love to make a deal if the company can produce a high-value gazebo with lower price. Marcus asked Damion to work with Simon to make a high-quality gazebo within the budget range of 5,000 to 5,500.

Kensington Garden Rooms-ttue-value

After two (2) weeks, Marcus returned to Kensington Garden Rooms to check on the progress of the lower priced gazebo. He challenged Simon and Damion to make the gazebo better. The business partners figured it out and their relationship is stronger.

Kensington Garden Rooms-new-warehouse

Conclusion and Updates on the Business

Marcus was extremely impressed with the final product the Kensington Garden Rooms presented at Gold Value. The feedback from the store owner and potential customers are all positive. Marcus and the Kensington Garden Rooms team are all excited about the future of the company.

Kensington-Garden-Rooms-success

Kab is still an investor of the company and Marcus has no plans of buying him out. Marcus does not think that the Kensington Garden Rooms will expand all over the place soon. Simon, Damion and Jack are all appreciative with his help and direction.

I hope you enjoyed this review of this episode.

Don’t forget to share this review on social media and share with us your opinions on the episode and its characters in the comments below.

Thanks again for visiting.

Thanks again.

Rob

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