Since 2002 I owned a company which specialized in broadcast and professional video equipment sales, rentals and production. Our customer base included television stations, freelance cameraman and producers, small to large sized production companies, other video equipment dealers and independent film/video makers. We bought cameras, lenses, VTRs (video tape recorders), tripods, media and accessories in Japan and sold and rented the gear worldwide.
In Japan and especially Tokyo, there are a number of places to purchase new and used professional video equipment. There are a handful of shops centrally located in Tokyo that specialize in second hand video equipment sales. These shops buy used equipment from Japanese video production companies or rental houses or they take that gear as a trade-in towards new equipment. They need an outlet for the used gear and my company was ultimately one of the main overseas outlets.
Things were going great up until the crash. We were averaging sales of between $150,000 – $250,000 USD per month… sometimes reaching $500,000 on good months. When I say “we” I am talking about my wife and I – just the two of us. The average sale ranged from $6,000 – $10,000 and that typically included a camera package with lens, batteries and tripod or a single high definition VTR for an edit suite or field production (production truck, live event…etc.). Some of those decks can get rather pricey at $20,000 USD +
Then, all of the sudden in the summer of 2008 the bottom fell out of the market. The problem started with banks giving out home loans, lines of credit and credit cards to people who couldn’t afford them. People started defaulting on their loans, foreclosing on homes…etc. etc. – you know the story. This turned the entire economy upside down which quickly trickled down to little old me.
“How?” you might ask…
95% of our sales were financed meaning they were paid using either a credit card, line of credit or loan of some sort. When the banks realized that they screwed up the first thing they did was slam on the brakes. They stopped financing my clients which meant nobody was buying and I wasn’t selling. Sales literally stopped dead. I remember checking my phone line to see if it was working because it just wasn’t ringing. Some of my clients flat out told me that their credit cards and/or lines of credit were revoked by their banks even though they were in perfectly good standing.
Oh, did I mention the decline of the USD vs. JPY? That stings a little bit.
The result of the banking crisis caused my company to go belly up at the end of 2008 like many others. Although sales were good in the past we didn’t have the capital to keep ourselves afloat during the hard times. When we went to the bank to ask for a loan to hold us over until things got better, they pretty much laughed at me and told me to get lost. I guess I can’t blame them.
Considering that things were only getting worse we decided to close down shop. It hurts to think about it and we won’t soon forget our experience as small business owners during the “depression of 2009″. All we can do is move forward and stay positive.
In a nutshell that’s how my business completely crumbled.