Do they make money spending 7% on advertising?

I’m curious if the business model is trending down or if the issue is within your organization. Lots of questions

With $1.1M in sales it still isn’t clear why you’re losing $150k per year. Do you have excess staff, or salaries too high? Is there an opportunity to optimize this or cut expenses to make a profit on your sales

Are the events you hold in an industry that is thriving or trending down? What’s the business / industry - there are industries like newspapers and magazines that are dying, times change.

I think what’s most important is that you got the gift of feedback, don’t look a gift-horse in the mouth. You should be thankful and make sure they’re treated fantastic when they return (because the alternative is they never return)

I’d give him the raise you think represents what you said, you said you agree he needs a raise. Give him the fair wage and let him decide the rest.