Friday, September 30, 2022

Athans Motors Update – What Happened After The Profit

Athans Motors Before The Profit

Athans Motors was started in 1996 by Pete Athans, a businessman who had a lot of experience in real estate, but absolutely none in the car business. Before Marcus stepped in, Pete sunk a ton of money into the business. The owner spent so much money on things such as video game machines and a ceiling that like clouds that he was unable to operate the business or even buy cars. Marcus Lemonis saw potential in Athan’s motors and wanted to help people save it while making a little money himself.

In Morton Grove, Illinois, Athans motors started in 2009. Pete started his first car dealership with money that he made from flipping houses during the recession. He spent $4 million making a business where people could come in have their cars fixed, sell their car, buy a new car, or just come in, have coffee, and play video games. Pete did not have the investment capital to purchase more vehicles. He ran the business with his cousin Tony, who he made general manager. Tony was on the verge of leaving the business because Pete questioned every move he made. Athan’s motors had problems. The business was losing over $1.8 million per year. He invited Marcus to come and save his business.

Athans Motors on The Profit

Marcus Lemonis arrived at Athan’s motors surveyed the empty parking lot, and wondered aloud if it was even open. He also noticed that the only cars out front were very high end, which could drive away potential customers. Marcus stated that Athan’s motors could be charging over $30,000 what typical customer would want to pay for a used car.
Marcus approached the salesman and asked him how many total cars Athans Motors had on the lot. The salesman told that the only had 20 cars, which Marcus describes as a private collection instead of an inventory. Marcus went back to meet Pete, who explained that he’d only been in the car business for five years. Pete admitted that he had spent close to hundred thousand dollars on the walls alone. He said that the renovations have cost over $2 million.
As Marcus got a tour of the facility which had video games, the theater area, and granite walls, he asked Pete how any of it helped him sell cars. Pete tried to explain that he wanted to create a place where people want to hang out. Marcus had to explain that customers don’t want to hang out. They want to buy a used car and then leave. Marcus continued, pointing at all the extras and letting people know that they could have been inventory instead.
Pete admitted that he had $6.9 million in debt in the business. He said that he was losing over hundred thousand dollars a month, and financing Athan’s motors out of his own pocket to keep afloat. Marcus went on to meet the accountant, Erica. When he asked to see a balance sheet from last month, Erica explained that all financial records stayed in Pete’s office. Marcus told him it was a really bad idea not give Erica she needs to do her job.
Marcus informed Pete that he needed an additional hundred cars in inventory to be profitable. He needed $1.5 million of working capital in order to purchase the inventory. Marcus introduced himself to Tony, who was the general manager. Tony said that there are many customers that showed interest in Athan’s motors, but wasn’t served by the expensive cars that they were selling. They walked back to the service area, which was busy with activity. Tony said that the service area brings them $100,000 per month.
Tony explained that he didn’t have authority over any department because Pete liked to be in charge of it all. Tony said that his cousin was a good guy, but he liked to micromanage everything. Tony complained about Pete’s expensive taste, saying that when you had $100,000 to spend he should be spending it on multiple cars. Tony complained that his relationship with Pete was strained because of this attitude towards the business.

Marcus said that he knew the car business, and he thought he could make Athans Motors profitable. He told Pete that the stakes were huge if he lost the business – Pete could lose his house and maybe even his wife. Marcus offered him 3 1/2 million dollars in exchange for 50% of the business. Marcus wanted to be 100% in charge of the business because he knew the car industry. Pete expressed concern about Marcus’s involvement, and Marcus pointed out that he had 20 employees under his care. Marcus said that there’s nothing magical about running the business, but Pete was convinced that he had something special even though it was losing millions of dollars.
Pete expressed that keeping businesses name was important to him, but Marcus said that he should worry more about keeping the business open. It was about marketing, not putting his name on the signs. Marcus said that he would do the deal if Pete didn’t put his pride away and let him run the business.

Pete expressed that keeping businesses name was important to him, but Marcus said that he should worry more about keeping the business open. It was about marketing, not putting his name on the signs. Marcus said that he would do the deal if Pete didn’t put his pride away and let him run the business.
Pete walked away from the discussion, but when he came back he agreed to take the deal. Marcus handed him the check for $3.5 million and they hugged on the deal. Marcus explained to all the employees that things were about to change dramatically. Marcus said that he was going to liquidate all the expensive cars that weren’t selling, in addition to the video game machines and TVs that weren’t selling cars. He would replace the novelties with car products such as oils. He wanted to have a grand reopening event that shows people that they were willing to cater to everyone now.

Pete walked away from the discussion, but when he came back he agreed to take the deal. Marcus handed him the check for $3.5 million and they hugged on the deal. Marcus explained to all the employees that things were about to change dramatically. Marcus said that he was going to liquidate all the expensive cars that weren’t selling, in addition to the video game machines and TVs that weren’t selling cars. He would replace the novelties with car products such as oils. He wanted to have a grand reopening event that shows people that they were willing to cater to everyone now.
Marcus told Tony that he was going to let him do his job instead of micromanaging everything. He took Pete, Erica, and Tony to tour the lot and the inventory. Marcus explained that was the money that Pete used to buy one Porsche SUV, he could’ve bought six other cars that would’ve actually sold. Marcus said that Pete is refusing to listen to anyone who actually knows the business because he wants to do things his own way.

Marcus told Tony that he was going to let him do his job instead of micromanaging everything. He took Pete, Erica, and Tony to tour the lot and the inventory. Marcus explained that was the money that Pete used to buy one Porsche SUV, he could’ve bought six other cars that would’ve actually sold. Marcus said that Pete is refusing to listen to anyone who actually knows the business because he wants to do things his own way.
Marcus started going around the lot and marking down cars that had sold 60 days. Pete protested, but Marcus informed him that it was important to get the cars off the lot. He told Tony that he expected him to sell all the cars on the lot by the end of the week. The scene cut to Tony bringing wholesalers in to show the cars. Pete was watching on the cameras. Pete came out to interrupt the sale of the car because he thought it was going for too low.

Marcus started going around the lot and marking down cars that had sold 60 days. Pete protested, but Marcus informed him that it was important to get the cars off the lot. He told Tony that he expected him to sell all the cars on the lot by the end of the week. The scene cut to Tony bringing wholesalers in to show the cars. Pete was watching on the cameras. Pete came out to interrupt the sale of the car because he thought it was going for too low.
Marcus pulled him aside to ask what his problem was. Pete said that he had to be in on every transaction because every couple thousand the world to him. Pete said that he didn’t trust Tony to sell the cars because it’s his money, and Tony would lose nothing. Marcus said that it was a problem that Pete kept cutting Tony’s deals off. Marcus informed him that all cars that have been out on the lot over 60 days need to go, so this particular car is going to be sold even if it was at a loss.

Marcus pulled him aside to ask what his problem was. Pete said that he had to be in on every transaction because every couple thousand the world to him. Pete said that he didn’t trust Tony to sell the cars because it’s his money, and Tony would lose nothing. Marcus said that it was a problem that Pete kept cutting Tony’s deals off. Marcus informed him that all cars that have been out on the lot over 60 days need to go, so this particular car is going to be sold even if it was at a loss.
Marcus brought Tony to the auto auction to find new inventory. Tony and Marcus picked up 20 used cars for $300,000. Marcus brought in workers to transform what used to be the lounge into an auto accessory store which would bring in revenue. Pete was upset that his lounge was gone, but Marcus explained that there’s too much space being wasted that wasn’t making money.

Marcus brought Tony to the auto auction to find new inventory. Tony and Marcus picked up 20 used cars for $300,000. Marcus brought in workers to transform what used to be the lounge into an auto accessory store which would bring in revenue. Pete was upset that his lounge was gone, but Marcus explained that there’s too much space being wasted that wasn’t making money.
In the next scene, Tony walked into Pete’s office and shut the door. He gave his resignation and told Pete that there is no amount of money that would get in between him and his family. Pete was refusing to let him quit. Tony said that his decision was made, and he cleaned out his desk.

In the next scene, Tony walked into Pete’s office and shut the door. He gave his resignation and told Pete that there is no amount of money that would get in between him and his family. Pete was refusing to let him quit. Tony said that his decision was made, and he cleaned out his desk.
In the aftermath, Marcus explained that Pete was going to have to hire one to replace Tony, and he wouldn’t be able to micromanage them. Marcus had Athan’s motors branding removed, and replaced it with the new name which was AutoMatch USA. The new branding conveyed that they would have something for everyone. Pete said that he didn’t agree to the name change. He walked away in anger.

In the aftermath, Marcus explained that Pete was going to have to hire one to replace Tony, and he wouldn’t be able to micromanage them. Marcus had Athan’s motors branding removed, and replaced it with the new name which was AutoMatch USA. The new branding conveyed that they would have something for everyone. Pete said that he didn’t agree to the name change. He walked away in anger.
Marcus followed him and explained that when he gave him the $3.5 million it was to start a completely new entity. Pete told him that the deal was off. Marcus explained that it wasn’t off because that wasn’t how things worked. Marcus said that until they got the business right, they were going to make changes. Pete said that he was nervous that soon there would be anything left of himself in the business. Marcus sympathized but said that the process is going to be painful but he would make money. Pete finally agreed.

Marcus followed him and explained that when he gave him the $3.5 million it was to start a completely new entity. Pete told him that the deal was off. Marcus explained that it wasn’t off because that wasn’t how things worked. Marcus said that until they got the business right, they were going to make changes. Pete said that he was nervous that soon there would be anything left of himself in the business. Marcus sympathized but said that the process is going to be painful but he would make money. Pete finally agreed.

Athans Motors Now in 2018 – The After ‘The Profit’ Update

Since the grand reopening, AutoMatch USA has been doing great. Not only are they still open, but they now have many new locations. They teamed up with another one of Marcus’ investments, 1- 800-car-cash, and the former Athans Motors buys most of their inventory from them.

Ariel Leather
Ariel is a freelance writer, Etsy seller, and Internet money-making quasi-expert living in New Jersey. She is pursuing her A.A. In Marketing at Brookdale Community College. Ariel enjoys traveling, hiking, unnecessary impulse purchases, and making things with her hands.
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