Marcus Lemonis, the CEO of Camping World and star of the hit CNBC series The Profit, has some straight advice for entrepreneurs: Know your cost of labor.
This is what he tells MixedMade co-founder Casey Elsass in episode two of Inc.'s new video series Ask Marcus Lemonis.
In each episode of the series--which is published on Tuesdays on Inc.com--an entrepreneur asks Lemonis one question about his or her most pressing business challenge.
Elsass, whose inaugural condiment product is called Bees Knees Spicy Honey, would like to learn from Lemonis how to scale his business.
"We have a commercial kitchen space, but all of the shipping is done out of my apartment," Elsass says. "This really isn't conducive to growth."
Having made $170,000 in honey sales during his first year in business, Elsass confides that he's considering hiring a co-packer to handle product manufacturing and packaging, but isn't sure that he wants to compromise on the handmade quality of his honey.
Lemonis, in characteristic fashion, is blunt: "I don't like the co-pack idea. I think your personality is so interesting. You are the product. And so I think the minute the product goes from being made by you to being co-packed, you're going to lose something."
Lemonis also says that if Elsass really wants to make good money, he needs to know what it costs to make his product: "I don't think you're ready for retail until you truly know what your fully loaded costs are," he explains.
Currently the honey sells for $14 online, but Elsass admits that he's unsure of the exact breakdown of the labor time and other costs that go into making and packaging it.
Ultimately, Lemonis is optimistic about MixedMade. Watch the video to find out why.