Had owners meeting with Cheng Yang. We were having difficulty reaching him through email and phone or through his agent.
We talked about the state of the investment. He questioned the capital expenditure, the management, and the what if the new plan doesn't work. Maria explained it's a business and there is risk, but we have a more intensified role in the project now. We have tested the new strategy and have seen it work. Now it is just implementing and enforcing. Maria explained that the stores ran out of money, but they are being productive and they have grown. They are viable locations and investments. They are creating the jobs and completing the objectives.
Sabrina explained that we had to adjust the management team multiple times in the process to find the right fit. One of the sets of managers was the actual franchisor in the area who acted as the lead supervisor to help the project after it did not meet the initial objectives. They were doing well with guest count but did not succeed with retention and ticket average. We changed the general manager after that and Sabrina and Darryl took over the management of the new general manager.
We defined new parameters, goals and a new marketing plan. Sabrina traveled to the locations to roll out the marketing plan. We proved the effectiveness of the plan while conducting the roll out. Now we are working on adoption from the team and enforcement of the plan.
We discussed selling Oceanside. He asked for the sales price. We said around 130k. He asked if he could put that money towards the Fallbrook salon. We said yes but additional capital is needed now instead of later. It would take us 90-120 days to get a buyer and sell in our estimation.
He asked what would happen with that money after it was sold. We stated we would need to talk to immigration counsel but it's his money so he can decide.
He asked about a 3rd salon on the balance sheet. Maria explained that is actually a bank account not a third salon. It is showing a negative balance in the main account.
The line dropped off. We did not get a final decision from Cheng Yang on what to do. Trying to schedule.