Tonnie had an idea for a bakery. Initially, the idea was to be a local small business offering a unique bakery experience. Walk-in and make your mini cupcakes. You can choose the cake base, whatever flavor frosting you would like, what kind of sprinkles and topics, etc. The first location they had opened was having some success, and so Tonnie and his wife decided to open a second location.
Even though it appeared as though the business was profitable, that was far from the case. Most of the couple’s ability to open a second location in the first place was thanks to a loan from Tonnie’s wife. It seems as though it might be common knowledge that taking a loan from a spouse is not the best idea. However, what was done had been done, and now the loan was serving as a strain on the relationship. Over $100,000 had been pledged, and not only was the bakery not increasing business, but profits were also actively taking a hit. More loans were being taken on, more money owed, and no success to show for it.
An appearance on the Wendy Williams show had given Tonnie’s Minis some name recognition; it was the other factor that allowed for a second location to open. But the owners were not able to capitalize on the name recognition the way that they had anticipated.
Tonnie’s on The Profit
The Profit Season 3 Episode 3
Unfortunately, things don’t look so good as soon as Marcus shows up at the property. The business is not in the best building or location in the city. As he walks around an inspects the place, he can’t help but notice just how crowded the place is. Not only is that bad on the customer’s end, but it’s also arguably worse for the people working there.
Initially, one of the apparent limiting factors is addressed. The cupcakes are delicious, which is a big pro. On the other hand, given the fact that these are assembled by hand in front of the customer, it is hard to make many sales per day. There is also some confusion as to how much the production of each unit costs; a red flag as far as Marcus is concerned.
At this point in the episode, Marcus discovers a whole lot about what is going on behind the scenes and leading to turmoil within the business. For one thing, Tonnie has his sister working at the bakery, and she is making so little money that she is considering leaving the job. It isn’t sustainable for her. This is also where it is revealed to Marcus that Tonnie’s wife has contributed almost $250,000 from her retirement fund into the business, and it is causing a lot of stress in their relationship.
Marcus does some investigating and finds that there are also a few significant issues in the production of the cupcakes. Unfortunately, even though Tonnie’s sister agrees on the assessment, she explains that he is a bit stubborn and has been resistant to changing operations.
It becomes apparent that Tonnie isn’t much of a businessman. He appears reluctant even to discuss numbers, and it’s understandable why once it is revealed that they are operating at an $80,000 deficit. Essentially, given the loan, Tonnie’s wife owns the business. It is then brought to light that she is not the only investor, and Tonnie owes more money from different loans he received. This moment is especially uncomfortable since we learn that his wife didn’t know about these other loans.
It’s time to suggest a deal, and neither Tonnie nor Marcus appear to be on the same page. Marcus offers $100k to help deal with the debt in exchange for 20% of the business. Tonnie then counters, saying he wants $600k for 33% of the company. Marcus thinks it is an absurd offer. After some back and forth, Tonnie reluctantly agrees to the original $100k offer.
The partnership is off to a rocky start, as Tonnie feels that Marcus is taking too much power away from him and calling all of the shots. He needs to shut down the store to reset some things for a better work environment. He also realizes after crunching some numbers that it costs 53 cents for the business to make each cupcake. That price needs to be lowered as the top priority. Although they butt heads, Marcus understands where Tonnie is coming, and they can ease tensions.
Issues mount when Marcus discovers that Tonnie has already put down a payment for a lease on a new location in Newark. Marcus becomes more and more frustrated with these unforeseen surprises. Further, he learns that the ceiling of the store in the city caves in and needs a $30,000 investment to repair. At this point, Tonnie’s wife is bearing down on him, but Marcus can explain to her their advertising strategy, and she calms down a bit.
Marcus can assist Tonnie in addressing some of these primary concerns, and utilizing new relationships with other local businesses, he can help Tonnie lower production costs. Before the episode ends, we see Tonnie repay his mother for her loan, and we also see that his wife is visibly much more comfortable being that Marcus’s consulting leads to 4x the sales being made daily.
Life After The Profit
At the end of the episode, things were on the up and up for Tonnie’s Minis. That trend has not stopped. If anything it has increased since his business appeared on The Profit.
He has managed to move to a new, superior location where he can fit more customers and generate more sales. He is also frequently receiving large order requests from clients all over the city and outside. The Newark location is up and running and generating profit. As you can see on the website, the company has also expanded into making cakes for special occasions like birthdays and weddings, adding yet another layer, and improving sales. Tonnie hopes to continue growing the bakery to become one of the most successful in NYC.
Disclaimer: The information provided in this article is strictly informational; INSIGNIA SEO is not affiliated with Tonnie’s Minis, The Profit, or any of its subsidiaries.