Marcus Lemonis (0:00)

This is Marcus. He sells RVs, and he makes $16 million a day doing it. He's the CEO of Camping World, the biggest seller of motorhomes in the world, along with everything else you need to use them. And Marcus Lemonis does it better than anyone. I'm going to tell you all about that today and how he figured it out. That's coming up in just a second. Welcome to the podcast. My name is John Davids. You can call me J.D. thank. Thank you for making this show number one in marketing and business in over 90 countries. But there are still so many people who don't know this show exists. Can you believe it? So if you're getting any value from what I'm laying down, please pick up your phone, open up the app that you're getting this from right now, and leave me a five star rating. And if you have any comments or want to hear anything on the show, leave it in the reviews. I will read them, get my best stuff to your inbox@johndavids.com and now let's get to the show. You're listening to Making it with John Davids. All right, so let's rewind to the year 1973. That's the year Marcus is born. He's an orphan, born in Beirut where civil war is raging. He's adopted by an American family and it happens to be a car family. His grandfather owns a dealership. I think it was a Chevy dealership. And Marcus quickly gets into the family business. He's spending a lot of time in his teenage years on the lot selling Chevys and watching how deals get done. And these skills are going to change his life. So Fast forward to 2001. Marcus is climbing the ranks. And then he notices something. You see, the real money isn't in cars. It's in recreational vehicles. The customers are more loyal, the margins are juicier, and this industry is dominated by indie shops. It's fragmented, it's disorganized, and it's ripe for a roll up. So Marcus makes his move. He scoops up a struggling RV dealership and he hits the gas. Within a few years, our motorman is buying up competitors left, right, and center. One by one. He's picking up players. And then he streamlines operations. He gets rid of people he doesn't need. He. He centralizes a lot of the back office, and he's making these places just run better. And then he lands the big one, the industry behemoth Camping World. That was a big name. He gobbles up their 30 locations, along with that iconic marquee name. And now Marcus is the big dog. He gets into accessories, repairs, financing, insurance, if it touches RVs. Marcus wants a piece. And growth explodes. In 2016, Camping World goes public. And at a $2 billion valuation. Now, guys, this is a classic consolidation strategy. And in retrospect, it's pretty obvious, but it takes a lot of insights to make it happen. You see, we can look at this here in 2025 and say, oh, cool. The industry was disorganized, it was fragmented. So this guy came in, he managed to raise a lot of money, and then he just started buying up the shops. But to make it happen, you actually have to focus your attention where no one else is looking. And. And then you have to execute relentlessly. Why was everybody else so focused on cars in the 80s and 90s and 2000s? And why was Marcus able to see it now? When this kind of thing works, the results can be enormous. Two decades later, Marcus is still at it, rolling up the RV world and turning camping into cash. Now, of course, Marcus is a TV star. He's on the profit. He's also got a new show in the works he's filming right now. It's called the Fixer. And he also invests in lots of businesses on the side. Obviously on the profit he does that, but he also invests in real life. You know, he actually invested in Bed, Bath and Beyond. It was going bankrupt and Marcus scooped it up. He just bought Bye Bye Baby, also a sister company, I think, to Bed, Bath and Beyond. And when he was asked why he did this, he said it was because while he was filming one of his shows, I think it was a home renovation show. Bed, Bath and Beyond was so generous, even though they were having difficulties and they were going through some kind of bankruptcy and liquidation at the time, they would give him discounts on their furniture. And because they were so generous to him when they fell on hard times, he wanted to do what he could to help. So he bought the brand. I think he's doing the same thing. He's pulling out the old Lemonis playbook. He's streamlining operations. He's gonna go much heavier online. He's. It's probably going to change the supplier, mix logistics, all kinds of other stuff. This guy knows how to run a well oiled machine because he's done it for a long time with these big products with RVs. Now he's doing it with furniture. Something else I found in my research. He does crazy things with his money. So one time there was a small town that fell on hard times. I don't know the exact details, but I think this town was going to go bankrupt. And Marcus rolled up his sleeves, came into town and told them, if you guys can fix yourself, if you guys can find the entrepreneurial spirit and rebuild this town, I will fund you, I will invest in you, and I don't want anything back. This equity is yours, but you guys have to fend for yourselves. And then he was asked in the interview how much he ended up giving. It was about 4 million bucks. And he was asked, how are they doing now? And he said, I haven't been back. I didn't do it so that I could have statues put up for me or plaques or anything like that. I didn't do it for any of those reasons. I just wanted to see this town get back on its feet. And I was happy to invest the $4 million, give it back so that they could do better. Mm. I'm hungry. You guys hungry? I could go over some fried chicken right now from Jollibee. And no, this is not a commercial for Jollibee. This is a commercial for Influicity. That's my marketing agency. And Jollibee is one of our amazing clients. You can see how we help drive more foot traffic to their restaurants across america@influicity.com CH study. And hey, while you're there, check out all the other case studies from the amazing clients we work with. Influencer marketing, podcasts, social media content, AI and so much more. And if you want to work with us, just hit the let's talk button over at the top of the website. That's influicity.com and I'll see you there. So let's talk about the strategy behind Camping World, or what is now Camping World. The roll up strategy works across so many sectors and I've talked about it a whole lot on this podcast. We've seen it in car washes with Mammoth Holdings. Tillman Fertitta has done it in the restaurant industry and casinos with Landry's Authentic Brands Group. What Jamie Salter's doing over there with brands like Reebok and names like Shack, but it goes way beyond that. It works with things like dental offices and plumbers. It works when things get more efficient as you scale. So if you can scale and kind of do the same thing, such that all the back office practices can be centralized, things like ordering and shipping and vendor management, logistics, if that can all be done by one team essentially, or one department, and then you can Scale it up to 10, 20, 30, 50, 100 locations or units. That's great. Certainly it works in the world of RVs. It doesn't work when you're bringing together multiple different businesses. So we saw this with businesses like Thrasio and Perch. There was this whole generation of companies that rose up about four, five, six years ago. Basically, the business model was, we're going to raise a whole bunch of money, billions of dollars, and we're going to buy up Amazon stores. So we have a store that sells dog toys. We have a store that sells golfing equipment. We have a store that sells candles and kitchen appliances. We're going to buy them all up and make them one company, and it's going to be great. And it was a disaster. It was a disaster because there was really no synergies between any of these companies when you bought them and merged them together. You didn't streamline anything. You actually added to the complications. So it can be very tempting to think, oh, I'm going to consolidate this industry. A lot of industries aren't designed for consolidation. I talked about this to Ghassan halazon on episode 126. He's the CEO of Emerge Commerce, and he tried to do something similar with his E Commerce company and E Commerce rollup. And what he found was it just didn't work. So he had to unravel it, and now he's rebuilding from scratch with one single brand. Something else I love about the Marcus Lemona story is the idea of taking your expertise to a different layer. Kind of reminds me of Taylor Sheridan and what he was doing as an actor. Remember, we talked about this? He was an actor, and he was trying to make it as a Hollywood guy, leading man. And then he realized, you know, I'm kind of better behind the screen as a writer, as a director. And now, of course, we have Yellowstone and we have Sicario and we have all these great shows. Landman, of course, who's. Everyone's watching Landman. And so he was able to just find a different layer of the same business. So he already knew the business inside and out. He knew the studios. He knew the system. And he said, listen, I'm going to go from being an actor to being a writer and doing screenplays and being a director, producer. And of course, now he's probably the biggest in Hollywood at what he does. Marcus did the same thing. He said, I already know this business inside and out. I understand dealerships. I understand the automotive industry. Let me just go to a different layer of it. The world of RVs, and all of a sudden you have a lot more flexibility. Don't forget the world of RVs. You can also have higher margins because you can do things like put in more expensive countertops or make the RV a little bigger or nicer floors. And all of a sudden you can raise the price tag and charge a lot more money without really increasing your costs very much. You can't do that with a Chevy. Now, I want to go next level on this one because this is. I'm going to say it, my friends, I'm going to say it. This is a beautiful business. It is a beautiful business. The business of Camping World is beautiful for many reasons, but we're going to go a little deeper. This is business 2.0 here. All right, so you've got a few things working for you in this business. You've got a high margin business. We just talked about that. Because you can have higher profit margins on an RV than you can on a car. You've got a lot of cash turnover, a lot of cash coming in. Because think about the elements of Camping World. You've got not just RV sales. You've got RV leasing, financing, insurance. You've got a lot of repeat purchases and a lot of loyalty. So you got customers. Essentially, the lifetime value of a customer, the LTV is not one or two or three cars in a lifetime. It's probably a bunch of RVs. You know, they upgrade every three or four years. They come in for servicing, they come in for other camping gear. There's also a membership. They have. I think they have a business called Good Sam, which is a membership club for RV lovers and camping lovers. And so you've got a really high margin, a 90% margin business, because it's just membership fees they're paying. So you've got all this cash coming in, right? We got an avalanche, a flood of cash coming in. And that's great. And that's the first part of why it's a beautiful business. That's not the whole thing. That's just the first part. So what do we do with all this cash? Well, we can invest it in inventory because we got to buy our RVs or we got to buy. Got to put up a bunch of money to get the RVs. But then there's something else going on here, and that is the real estate play. The real estate play. Now, I don't have all the details on this I'm trying to figure out. I've been DMing Marcus on Instagram and talking a little Bit, But I don't have all the details here, but here's what I'm gathering. I'm pretty sure there's a piece of this business where they take a lot of that cash flow and they put it back into owning the real estate, the land and the buildings that they operate in. And you might think, okay, well, so what, what does that mean? Well, what that means is that you not only have cash coming in, but you have a vehicle right inside the company to grow that cash and to grow it at a pretty rapid pace. And, and that's actually a unique thing because a lot of businesses, you know, anytime you hear about a business issuing a dividend, right, we have a whole bunch of cash on our balance sheet. We've got a few million bucks. Let's just give that back to shareholders. What you're effectively saying as the business owner or as the CEO running that business is we have no use for this cash. We cannot compound this cash for you. Because if you could just keep that cash in the company, keep it on the balance sheet and reinvest it somehow and get a 10, 20, 30, 50, 100% return on that money in some reasonable timeframe, no shareholder would ever want you to give them a dividend. They would just say, well, I don't want to take the cash out and then pay tax on it and then have to find some other place to invest it. I'd rather you just keep the money in the company, keep it growing, and that's great. My equity grows and if I ever need some cash, I can sell some shares or whatever. But generally, if you have a business that's making lots of money and is able to continue making money, which most businesses you can't. I'll explain that in a second. You have this infinite money making machine. So let me go back to this example here. You've got a lot of cash being made with the RVs, financing, leasing, insurance, memberships, all the money coming in. You then take that money. You don't pay it out, so you don't pay any tax on it. You don't pay tax when you pay it out. And then you're able to take that and just reinvest it in the real estate you've got, compounding cash flow, compounding capital growth, tax efficiencies. And a lot of other companies do this too. Some companies try it, but companies that do it, well, Chick Fil A does this. Chick Fil A does some form of this where they make a ton of money at every location. I believe Chick Fil A makes the most money at any individual location of any fast food restaurant. It's something like 8 million bucks per year per location. McDonald's is like 3 or 4 million per location. So Chick Fil A makes a ton of money at their stores, and they take that money and they reinvest it in their real estate. And they can make huge amounts of money over time with tax efficiencies and just grow and grow and grow that capital. Costco is another one. And maybe the biggest example of this ever is Berkshire Hathaway, the behemoth, the person that does this better than anybody else. Warren Buffett. You've got high cash flow businesses like Geico, like all the insurance companies that just print cash, and all the investments that they get, dividends, and they just got billions. Think on my last time I looked, what did he have, like $350 billion of cash on hand. And then you've got businesses within the same company that are able to take that money. Railroads, oil companies, businesses that require a lot of capital. So as your business grows, and I understand if you're at the beginning of your business journey, you might be thinking, I'm just trying to make a few million bucks here. Okay, cool. Once you have a few million bucks, you're going to be faced with another problem. And that is, what do I do with this money? Because if you just leave it sitting in a checking account, it's going to dwindle away. Inflation just steals your money. Inflation is a thief. So you got to figure out ways to invest that money. And these businesses that have both sides running both levers, running both the money making and the money investing. Oof. These give me chills. These are beautiful businesses, my friends. That is the story of Camping World. That is the story of Marcus Lemonis. Wow. This guy is so impressive. Let me know what you guys think. Leave a rating review on this podcast. Leave a comment wherever you're listening. Get my best stuff to your inbox@johndavids.com Talk to you guys next time.