1998 – The Far East Crash cost me EVERYTHING!

25 04 2008

The Far East CrashIt took 5 years to build a successful business and only one day to destroy it. I had built a business from scratch after investing £16k which at the time was all that i had in order to market my products to my target audience. From 1993 I had worked days, nights and weekends to reach my goal of becoming the UK’s leading promotional clothing and accessory business in the UK.

I had started to realise my dream and had secured clients such as Walt Disney, Imperial Tobacco, Coca Cola, Sky BSB, Virgin, Chelsea FC, The Spice Girls, Oasis, Team McClaren, Film 97,98 and I was a major supplier to Wembley Stadium. My turnover had gone from £350k to £3.2 million in the space of one year and we now had a 20,000 sq ft warehouse/ office and held just of £1.5 Million in rotating stock.

I had no ideas that the Far East would crash overnight! Once the crash happened my Korean Partners had to withdraw from UK operations and understandably so. Little did i know, the Korean Glory seeker (my initial stock supplier) had over supplied the UK and European market and was now re-called to Korea to answer to his superiors.

I had spoken to my father about returning the stock in great depth. The Koreans had asked for me to send all the stock back to a bonded warehouse but this would leave my warehouse practically empty with huge costs with a 3 year lease still to run… I was not sure whether to send it back or to keep hold of the stock and call their bluff? My father said to me “Do the Honourable thing son”….The Korean had promised that there would only be a 90 day delay before new stocks arrived, but i felt differently.

I returned the stock and the Koreans had no intension of re-supplying the stock and as a result i could not supply my clients and had no choice to liquidate the business. My advice to everyone when either choosing  a major supplier is to check the risk and exposure that you may face before entering into any agreement that could at a later stage cause your business potential harm!

 

I did return all the stock and did the Honorable thing, but there have many days where i wished that i had not and that i something that still haunts my memories still to this day!

Regards

TUE

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6 responses

25 04 2008
1998 - The Far East Crash cost me EVERYTHING!

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24 09 2008
turner@ Home Insurance

That is a sad story. I’m sorry to hear what happened. It is hard to lose so much after working so hard. It happened to a friend of mine last year and he lost everything. Good luck.

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