Sasson: With a massive inventory in the warehouse, the weight of the company’s loans, and the long term credit we gave to our European customers, our company was on the verge of a serious ﬁnancial crisis. We deposited our customers’ promissory notes in the banks as collateral for our loans, but then all of a sudden, a few of our customers in Germany and France declared bankruptcy, and our company’s claims were gone with the wind.
After that, an acquaintance who worked at a German bank told me never to take too many bank loans. He said that banks give their customers loans and credit lines as long their ﬁnancial situation is good, but the second they are in real need of money, they immediately cancel your credit, and ask you to pay the loans you’ve taken. Loans are just like an umbrella that they give you when the weather is sunny, and when it starts raining — they take it back.
At last I turned to Agha Youssef, and told him that we should avoid further purchases and sell the existing stock because our company is on the verge of bankruptcy and we need to reduce our bank loans. On top of all that, the constant disputes between us partners became unbearable, and I just couldn’t take it anymore. His answer was: “Sasson, you are so negative and worry in vain!”
His answer gave me hope, motivation and a new idea.