Are Restaurant Owners Overcharging You? The Hidden Profits Behind Your Favorite Spots

Hello, it’s Earnest Mann here! In today’s episode, I’m breaking down the hidden markups and questionable practices behind restaurant pricing—a peek into the reality of restaurant costs that might just surprise you. We all love a good deal, especially at places like Costco, where prices seem fair. But what happens when business owners turn those deals into huge profits at your expense?

What You Didn’t Know About Restaurant Markups

I noticed a couple at Costco stocking up on bulk items that restaurants typically use—cheap cooking oil, bulk pepper, and low-quality toilet paper. Observing their purchases, I realized they were likely local restaurant owners. These hidden details, like the coarseness of pepper or cheap bathroom supplies, reveal just how far some go to maximize profit while minimizing quality.

Eye-Opening Profit Margins on Drinks and Food

I found out they sold $0.28 drinks for a whopping $2.75, marking up by 163%! With such high-profit margins, it’s no wonder some restaurants close, not from lack of profits but from owner greed. Here, I also explore common reasons restaurants fail—not from a lack of customers, but due to mismanagement, inflated owner expectations, and prioritizing profit over quality.

How to Spot These Tricks When You Dine Out

Next time you’re in a new spot, check the pepper grinder, toilet paper quality, and the cost of simple items like a soda. These small details often reveal the true priorities of the establishment. As a former restaurant insider, I know these “tricks of the trade” and want you to be aware of what you’re really paying for.

Closing Thoughts

Thanks for tuning in to this episode! I’ll be here every Monday and Friday, sharing insights that help you spend your money wisely. Don’t forget to hit subscribe and share this show with friends—it helps the channel grow and keeps this information coming your way.

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I'm a deep thinking contrarian, a very pragmatic idiocythrope. I believe that function determines desirability and legitimacy. I don't like the superficial and/or pretentious, nor the shallow. I speak the truth as best as I know it, as a professor of tautology.

With friends, I desire quality over quantity. I know some very important life truths I'm just waiting for you to ask about. I have found in life, many people talk about happiness, but are unwilling to pay the price, or believe they shouldn't have to, because they are entitled to it, but I know with absolute certainty, that such beliefs are always due to stupidity, Insanity, or some degree of both.

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I look forward to hearing from you, and until next Monday or Friday remember, the world may be misinformed and batshit crazy, but YOU, don’t have to be!

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© 2024 The Earnest Mann Show

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I just want you to know that by being

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here you're appreciated for your

0:06

curiosity always a sign of intelligence

0:09

and wisdom which means through you

0:12

despite all the crazy there is hope for

0:15

the world yet thank you for being

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here when you go to Costco probably the

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last thing that's on your mind is being

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ripped off you might be worried about

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spending more than your budget allows

0:40

especially considering the hard times

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we're living in right now but generally

0:45

speaking you're looking forward to all

0:48

those good deals especially at the food

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court $1.50 for an all beef hot dog and

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a drink are you kidding me who the hell

0:58

would argue with that well I'm not going

1:01

to argue with that but I am going to

1:04

make you aware of something going on

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there that you may not have even

1:10

considered now you might say I have a

1:14

curious streak in me and I often

1:17

remember and pay attention to things

1:19

that most people wouldn't and in my life

1:23

it's been both a blessing and a curse

1:26

but I'm mentioning this so you'll

1:28

understand how it is that I came to know

1:31

what it is I'm about to tell

1:35

you to my understanding it's common

1:38

knowledge that many people who own

1:40

businesses such as restaurants shop at

1:44

Costco and you can tell this by simply

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looking at the items in their shopping

1:49

cart a person for instance who has a

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very large amount of toilet paper

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napkins and margarine is more than

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likely to be a restaurant owner

2:00

it's especially obvious when they buy

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large quantities of cheap cooking oil

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and margarine the extremely lowcost and

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lowquality food they in turn serve

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you in their

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restaurants what I just said will allow

2:18

me to segue right into the type of

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criminality you should be aware

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of so there was this man and woman I

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noticed at Costco

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uh who each had a cart and they were

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obviously together both of them had

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their cards full of the kind of things

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you most often use in a restaurant and

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how do I know this you may ask well I

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was in the restaurant business for

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several years I know a hell of a lot of

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the tricks of the trade and apparently

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so did this couple it is also one of

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several reasons why I got out of the

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business I actually rather enjoy having

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a clear conscience and being able to

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sleep at night something that apparently

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can't be said for many restaurant owners

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including the ones I just mentioned I'll

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explain how I found that out for certain

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in a few

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moments allow me for example just to

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give you this Insight next time you go

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into a restaurant that's totally new to

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you regardless of the decor the weight

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staff or anything else when you sit at

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your table look at the pepper

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shaker in most cases you'll find the

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pepper to be a very coarse grind as I

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said this is pretty typical a quality

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black pepper will be in a fine grind and

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only cost a small amount more than

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coarse black pepper but it's speaks

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volumes about the owner because more

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than likely they're a cheap

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skate and cut cost anywhere and

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everywhere they can not to keep prices

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and cost down yet another lie

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but actions solely intended to maximize

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thievery pure and

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simple the same general rule applies to

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many other items they may use for their

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restaurant

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the second biggest one to look out for

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is not just the condition of the

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bathroom but the quality of the toilet

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paper if the toilet paper is so low

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quality and bad that you'd actually

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rather wipe your ass with sandpaper I

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would strongly suggest finding another

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place to give your hard-earned money to

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Simply consider this if they don't give

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a damn about the quality of their Pepper

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or toilet

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paper how much quality and love do you

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think they're going to put into the

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actual

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food so now I'll get back to the

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original so I was paying attention to

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what this couple had in their cart and

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one of their items was a variety of

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sugar-free drinks I made a mental note

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of the case price because I was also

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really interested in getting some for

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myself which I in fact did so after

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doing some quick calculating the price

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per drink ended up being less than

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around 28 cents which is a good deal

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unfortunately the criminal business

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owners who like just about all

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restaurant businesses owners

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today continuously declare their love

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for their customers and the way they

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demonstrate that love Fest is by having

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profit ratios for their food and drink

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that would make many corporate minded

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entrepreneurs have a financial wet

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dreams over in this case profit ratios

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that were quite

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criminal you

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see that couple as it turns out runs a

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local Patio Restaurant I know this

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because I just happened to run across

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them when I was out and about and

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remembered them and I also remembered

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exactly those drinks they bought at

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Costco which they were selling for

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$2.75 that's right $2

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75 holy Christmas

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criminal so remember the drink

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originally cost around $28 cents each so

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if I'm generous and more than double

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that cost to 60 cents each that's still

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a whopping profit ratio of around

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73% but no that's not enough profit

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ratio for the greedy sons of at

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$2.75 each that's an obscene profit

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ratio of 163%

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and that's just for the drink

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not including the

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food and everybody wonders like it's

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some kind of mystery why

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restaurants are closing right and

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left that's why every time I hear these

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thieving bastards whining and bitching

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and complaining about how they're not

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yet making any

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money I can tell you with absolute

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certainty it's an absolute

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lie the overwhelming number of cases out

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there if a restaurant goes out of

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business it's mainly for one reason only

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greed to which I just gave you a

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perfectly good example

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of unless we are talking about a case of

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extreme physical mismanagement the

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business being run into the ground

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because of physical mismanagement

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such as a let's say you have a

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40-year-old uh restaurant owner who in

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the last year divorced his wife of many

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years and has been banging a 20-year-old

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hottie ever since who naturally became

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the restaurant's manager and also just

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happens to have a heavy cocaine

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Habit in the vast majority

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of well in the vast majority of cases P

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es the restaurant simply cannot afford

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the level of profit ratios that the

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owner has set it's not material cost

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it's not labor it's the fact that they

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are so completely arrogant that if the

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business is not producing obscene profit

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ratios it's simply not worth their

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time a lot of business owners especially

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restaurant owners tend to have a very

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inflated view of the value of their time

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and I have dealt with this too many

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times to

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remember I'm going to wrap this up by

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saying this is not the case 100% of the

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time and there can be cases with very

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odd circumstances that could force a

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formally successful restaurant to have

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to close their

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doors but before you get all teary eyed

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as you listen to the violin and piano

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music gently in the background as an

10:06

owner explains how he simply cannot go

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on don't forget to check the pepper the

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toilet paper and how much he charges for

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a

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Coke so don't run your restaurant or

10:21

life into the ground Park your ass here

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every Monday and Friday at 6:00 a.m. on

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YouTube on more the same time and days

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of my podcast please do hit the

10:34

Subscribe and notification Bell as it

10:37

really does help the channel

10:39

grow Compliments are great but the best

10:43

compliment you can ever give me is to

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tell a

10:47

friend until next time this is earnest

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and I usually am

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[Music]