‘Shark Tank’ stars share advice for small businesses in uncertain times

Kevin O’Leary and Barbara Corcoran share tips for business owners dealing with repercussions from the pandemic.
6:12 | 06/04/20

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Transcript for ‘Shark Tank’ stars share advice for small businesses in uncertain times
We are back now and we've just got the news, jobless number, another 1.8 million Americans have filed for unemployment. That is in addition to the 40 plus million that we have seen since the pandemic that have filed for unemployment. So many people hit hard by this pandemic. The economic crisis and small business in particular in America employing half of all private sector workers, we are giving them advice from the expert, our sharks, Barbara Corcoran and Kevin o'leary. I know you're devastated to hear that. The number not as bad as we've seen, but still more people filing for unemployment but before we jump into some of the questions now. Barbara, you'll be glad to hear a few weeks ago you told a small business owner to double her spending on ad spending and that advice seems to have paid off. We heard from Melanie. She is getting a return now that equals 22 times what she spent on that advertising, so that is good to hear. Your advice worked. That's great for Melanie. She took a chance like every great entrepreneur and paying off big and deserves that success. We'll turn to questions from our viewers like Melanie, the first one is from Toni, a small business owner in the fashion industry. Take a listen. We have an excess of products and need help creating a plan to reduce our inventory while still maintaining profits. All right, Kevin, what do you think she should do? Toni, you came to the right place. I have many companies in your you geolock advertising around your physical location if you had a store. You can use Facebook. That's probably the best tool and you give a great offer to your existing customers, buy two, get one free. That still profitable and what you'll find out customers care. We're in a time in America where existing customers, if you tell them the truth about your situation are willing to support you and will take the deal. Value but direct advertising to the region around your store. Don't waste dollars advertising to somebody in Texas if you're in New York and your inventory is in New York because you want to ship it to them in the most profitable way you can. Do that. You'll make money and have some happy customers. All right, Barbara, what would you tell Toni? Toni, first priority is to dump your inventory and not even worry about whether it's profitable. Just get rid of it. You don't want to get stuck. Then you must focus on the long term play on your business which is focusing on keeping your customers coming back. That's where the game is won. You want to do what every big box store has discovered, start a rewards program. It's a tried and true way to build customer loyalty and then you'll make a lot of profit over the long term. That's how you focus right now. All right, want to turn to Lena who has a professional cleaning service in upstate new York. Let's take a listen to her question. You know, there's so much support for black owned businesses right now. How can I put myself out there to make the most of this moment? We'll start with you, Barbara. What do you think she should do? Line that, you're right. There's plenty of support for black owned businesses but people have to know you're there so if you're not good at social media, get on it. It's the name of the game. You should reach out to your local media right now and tell your story. People love a story, where you came from, how you got started. What changes you're making in your business to reach your customer and make them happy in today's changing environment. Remember people are scared. You need to have your team wear protective gear, tell the customer about your new protocols and, remember, you have a three-month lockdown and people will be desperate to clean their offices and homes so make sure you start hiring. Black owned business wants to take advantage of the moment. The good news is there's no question people will always need great cleaning services but the protocol is all that matters and spend your dollars showing on social media you have a keen eye on safety. The protocol for going into someone's home where they're scared about contracting a virus is to ask the owners to leave while your team comes and your team wears gloves and masks. Your team even wears hair, you know, nets, whatever it takes to have the customer realize you care about being very, very focused on safety. When that happens and they feel comfortable, they'll call you in every week, maybe twice a week as long as that protocol is observed. That's where I'd spend my money convincing the customers you know what you're doing on safety. All right. Finally we have Jimmy, a restaurant owner in Chicago thinking about re-opening that dining room. Let's listen. We'll soon be able to open up for service but at 25%. My question is, should I do that or should I still just do carry out which has been working really well for me? Kevin, what should he do? No, do not open the dining space at 5%. You will lose money. It takes 60% to just break even. Focus on curbside and delivery keeping your kitchen staff working. Hopefully you've got the ppp so you have until the end of June to support your existing wait staff. The restaurant business is brutal. At 25% capacity is a money loser dog. Don't listen to Barbara on this one. Oh, wow, he's telling him not to listen. Give her a chance to answer first. What do you think? I know what she's thinking. I know Barbara so well, it's I don't agree with Kevin. Not unusual. Jimmy, here's the skinny. When you're building a business the good business decisions are never about logic, deductive reason, it's about common sense. Trying this, trying that. It's always easier to stay doing what you're doing because it's comfortable but you don't know what you're missing. You should get your doors open right away. You could always go back if it doesn't work out. What's the big deal, try it. Wow. Those are two very different one as Barbara says comes with common sense, the other does not, Kevin. Sorry, brother. Good to see you both, Kevin and Barbara, you be good. Look forward to talking to you again. Okay. Thank you, take care, everything, and be safe.

This transcript has been automatically generated and may not be 100% accurate.

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