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Author Topic: The end of DJ Models?  (Read 24580 times)

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Offline broadsword

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Re: The end of DJ Models?
« Reply #30 on: June 04, 2019, 01:36:10 PM »
Not too surprised by all this, I used to check the website and as the list of models
got bigger the timelines and progress charts got longer. I worked for a company
which did insolvency , administration etc. In a niche business like this the creditors
will probably end up with hee haw.
« Last Edit: June 04, 2019, 01:50:58 PM by broadsword, Reason: smoke signals at Fort Apache not working »

Offline Snowwolflair

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Re: The end of DJ Models?
« Reply #31 on: June 04, 2019, 02:01:23 PM »
The only hope is if the Chinese company who has done the work so far takes it on, possibly with a new sponsor, and if they are owed money its the only way they might get their money back.

A question that needs answered is did Dave put the IP in his name or the company.  He may have the IP in his name and given a licence to DJ models.  In this case the liquidator wont be able to touch the IP and we might see a new company "Pheonix Ltd" about to produce kings, and he would certainly be able to block the Chinese from making copies.

As I said earlier we do not have enough information.

One point is clear, the business we paid deposits to is dead (or will be very soon) and we should be claiming back our money against our credit card payments if we can regardless.  I am.

Offline Paddy

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Re: The end of DJ Models?
« Reply #32 on: June 04, 2019, 02:14:59 PM »
This is very sad.  Dave did some good work (on models) when at Dapol (no idea if it was profitable) and initially there seemed a lot of promise when he went solo.  For me though, there was too much over promising and not enough delivery from DJM (Shark being a classic example).  I get the impression that the capital costs/risks with model making are just too high for a one man band.

There is no doubt that Dave has talents when it comes to model making so hopefully one of the other companies may give him a job.

My thoughts are with Dave and his family though.  Whatever the cause of these events, I am sure Dave is devastated that his dream did not work out.

Paddy
« Last Edit: June 04, 2019, 02:16:26 PM by Paddy »
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Offline red_death

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Re: The end of DJ Models?
« Reply #33 on: June 04, 2019, 02:32:58 PM »
I can't (and won't) comment on DJM's situation as I don't know the full details.

As general background about model development in China:

- IP ownership has been done to death recently here and on RMweb. Even if it offers any salvation/protection for designs it is only useful if that IP is an asset of a company. Frankly in most cases it is worthless without the next stage...
- which is CAD, which should be a tangible asset of the company but CAD is relatively cheap and you'd want to be sure how accurate it is and whether both the tool design and mechanical/electrical design was sound. Ownership of the CAD will depend on the agreement between a designer and a commissioner - for example Revolution has ownership of the CAD (which has allowed us to move projects when necessary). Which leads on to...
- tooling - this is where the big money is both in terms of cash investment and in terms of potential assets. Like CAD depending on the agreement between commissioner and factory there are different possibilities about who owns the tooling - for Revolution (apart from the Pendolino which is Rapido's) we own the tooling and again can use it as we want even with different factories. If there is any question of ownership then proof of ownership should be relatively straightforward - we set out arrangements for each project, we are invoiced at agreed stages and can demonstrate proof of the various invoices. Final part...
- production - production won't begin until tooling is complete and agreed (and presumably paid for). Production is a unit cost per model with normally minimum numbers for totals and variants (of: model, details, liveries and/or numbers). Normally a deposit is asked for following a purchase order with the balance due at a final agreed date once production is complete.

There is a caveat to all of the points about moving CAD and tooling etc - there is an element of trust at both ends whether China or the UK ie the various factories often invest a lot of effort and money before they are paid and trust that they will be paid as agreed. Conversely we all have to be aware that China is a considerable distance away and that poses potential problems and risks of itself (as well as differences in language and legal systems). 

For the sake of brevity (in an already lengthy post!) I haven't included every little stage as there are a lot of approval stages, nor have I included research stages.

Our experience has been (bearing in mind we are working with a number of different sources now) that everyone we have dealt with has been very professional, taken a huge amount of pride in their work, done what they said they would in return for fair payment.

As I said none of that is meant as any comment on DJM, other than to set out both our experiences and to hopefully give anyone concerned some more background as to what the situation is like when commissioning model trains from China.

Cheers, Mike
« Last Edit: June 04, 2019, 02:34:35 PM by red_death »



Offline Bob G

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Re: The end of DJ Models?
« Reply #34 on: June 04, 2019, 03:00:19 PM »
Since all this kicked off with the issues over the tooling of the 17 and IIRC the OO 74, I hope it doesnít put the fear of whatsit up all the people who have successfully crowdfunded other very successful projects.
It is obvious in any business relationship that trust between parties is essential. As soon as this breaks down, for whatever reason, I canít see a good outcome.

Offline njee20

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Re: The end of DJ Models?
« Reply #35 on: June 04, 2019, 03:05:53 PM »
Yes, you have to imagine that this will lead people to be more reticent to part with funds for future models, which is unlikely to be good, particularly for new entrants to the market.

FWIW - Phil Parker over on RMWeb has spoken to CG&Co who have said that they've not yet been formally appointed and aren't providing any information. Clearly this is at odds with what Snowwolflair was told.

Offline Snowwolflair

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Re: The end of DJ Models?
« Reply #36 on: June 04, 2019, 03:09:19 PM »
Yes, you have to imagine that this will lead people to be more reticent to part with funds for future models, which is unlikely to be good, particularly for new entrants to the market.

FWIW - Phil Parker over on RMWeb has spoken to CG&Co who have said that they've not yet been formally appointed and aren't providing any information. Clearly this is at odds with what Snowwolflair was told.

Try reading my post before spouting rubbish.

Quote
I wanted to establish if it was a prepackaged administration or an insolvency.  Looks to be the latter but itís not finalised yet.

Online themadhippy

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Re: The end of DJ Models?
« Reply #37 on: June 04, 2019, 03:10:35 PM »
Quote
I assume that the liquidator's job is to sell the assets of DJM in order to pay the creditors.
:smiley-laughing:
First grab goes to the tax man and custom and excise,theoretically creditors come next,but in my experience the company doing the insolvency make sure they get there  lump next,regardless that the small amount owed  to a small businesses can often mean the difference between sink or swim.Even more galling is when the "insolvent" company  re emerges a few months later with the same management and equipment but under a slightly different name.

Offline njee20

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Re: The end of DJ Models?
« Reply #38 on: June 04, 2019, 03:14:24 PM »
Try reading my post before spouting rubbish.

Quote
I wanted to establish if it was a prepackaged administration or an insolvency.  Looks to be the latter but itís not finalised yet.

Calm down love - that appears to be more information than Phil was given, that's all I said, I didn't say either of you were wrong!

Quote
I assume that the liquidator's job is to sell the assets of DJM in order to pay the creditors.
:smiley-laughing:
First grab goes to the tax man and custom and excise,theoretically creditors come next,but in my experience the company doing the insolvency make sure they get there  lump next,regardless that the small amount owed  to a small businesses can often mean the difference between sink or swim.Even more galling is when the "insolvent" company  re emerges a few months later with the same management and equipment but under a slightly different name.

Not anymore, HMRC are now unsecured. Companies House article here. Administrators are first, then secured creditors, then unsecured creditors, which is most people, then any shareholders get the scraps of the scraps of the scraps.

Offline Snowwolflair

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Re: The end of DJ Models?
« Reply #39 on: June 04, 2019, 03:20:53 PM »
Try reading my post before spouting rubbish.

Quote
I wanted to establish if it was a prepackaged administration or an insolvency.  Looks to be the latter but itís not finalised yet.

Calm down love - that appears to be more information than Phil was given, that's all I said, I didn't say either of you were wrong!

Quote
I assume that the liquidator's job is to sell the assets of DJM in order to pay the creditors.
:smiley-laughing:
First grab goes to the tax man and custom and excise,theoretically creditors come next,but in my experience the company doing the insolvency make sure they get there  lump next,regardless that the small amount owed  to a small businesses can often mean the difference between sink or swim.Even more galling is when the "insolvent" company  re emerges a few months later with the same management and equipment but under a slightly different name.

Not anymore, HMRC are now unsecured. Companies House article here. Administrators are first, then secured creditors, then unsecured creditors, which is most people, then any shareholders get the scraps of the scraps of the scraps.

It's all about asking the correct questions, and paying attention to detail.  :D

Online themadhippy

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Re: The end of DJ Models?
« Reply #40 on: June 04, 2019, 03:21:31 PM »
Quote
Not anymore, HMRC are now unsecured.
so an even bigger slice of the pie for the  liquidators

Offline njee20

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Re: The end of DJ Models?
« Reply #41 on: June 04, 2019, 03:22:32 PM »
The administrators are always going to get their slice!


It's all about asking the correct questions, and paying attention to detail.  :D

You did also say "the company goes insolvent today", which is quite a different claim to what Phil Parker has said.
« Last Edit: June 04, 2019, 03:24:23 PM by njee20 »

Offline red_death

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Re: The end of DJ Models?
« Reply #42 on: June 04, 2019, 03:31:40 PM »
One thing that is important to add is that crowdfunding is a tool and not normally the cause of a business failure (though obviously it has different impacts).  Like any business tool it can be used well or badly.


Cheers Mike



Offline Snowwolflair

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Re: The end of DJ Models?
« Reply #43 on: June 04, 2019, 03:48:31 PM »
The administrators are always going to get their slice!


It's all about asking the correct questions, and paying attention to detail.  :D

You did also say "the company goes insolvent today", which is quite a different claim to what Phil Parker has said.

I phoned much earlier in the day than Phil and when I phoned it had not happened and there were discussions whether they or another liquidator would be engaged.  The view was it was going to happen today (or rather it would probably be unlawful if it did not).  As we speak the company may not yet be in administration which is the first step.

What I was trying to establish was the ownership, and or hostage takers (creditors) of the IP, tooling or CAD and the chap was quite open and helpful. 

As the day has gone on and the number of calls to them has increased I suspect they have become circumspect with what they are saying.

Bottom line, make any claims to cards or PayPal ASAP.

Offline class37025

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Re: The end of DJ Models?
« Reply #44 on: June 04, 2019, 03:58:24 PM »
I am just very glad that I stuck with my gut, and didn't stump up any cash towards any of these.

my decision was to wait till something was available, and then buy.

unfortunately, it seems my gut was right in this case. :(
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