Joseph Slomka
Torben,
Seems to me for the most part you shouldn't expect to sell the camera for much when you are done. The point is to use it to add value to a production and that is where is makes it money back. It will lose 75% of it's purchase cost but it should pay for it's self in direct rental or in indirect value generated on your work.
That said anyone who dropped the serious coin on an Alexa at literally any point in the last 10 years should be doing well. The camera is basically the same and produces top quality images with no fuss.
Though I'm sure if I get one they will announce a 4k+ native version
So I have a question for you...
How did you sell your camera body?
I am clueless on how to best sell large gear.
What worked for you and what didn't?
oh and for the short answers:
For leasing I have used Canon, though I also hear good things about Zeiss and Sony.
For Finance:
Bank of the West Commercial Banking
Typically whomever you buy from will have a favored financial institution that they point you towards to close the deal. They are motivated to make a sale.
I have purchased 'big' gear from VTP, ZGC and Abel. They have all done right by me on my transactions.
You are going to want to get an accountant with ties in the industry.
Leasing or financing gear makes more sense than an outright purchase in the world of cheap credit. I have financed quite a bit of personal gear as well as buying outright.
Before I go on, there was something troubling in what you said. If you can't afford to rent the gear you need and profit, you are unlikely to be able to afford the gear you are looking at. Like I said get an accountant with ties to the industry for guidance.
so purchase vs finance vs lease
Purchase:
When you are flush with cash and will be for the foreseeable future a purchase is great.
You outlay the money first and get to chose your depreciation schedule. Basically you get to write off the loss of value year over year for the gear on your takes. So if you buy a 50k camera and depreciate it over 5 years, you get to write off 10k a year from your taxes over 5 years.
Finance is like a purchase where you pick the depreciation rate except you won't have to front the cash up front. So if you think you will make $50k in 5 years off your kit, you can depreciate it over 5 years so you get a balance of money in vs money out. This makes your kit tax neutral. You can also get some 'wiggle room' by depreciating it slightly faster or slower so that you basically pay for your kit over time tax free.
The big idea about the top two is that you pick the depreciation time for your gear to something that is reasonable for the industry. ie-3-5 years this helps smooth out your taxes while you build equity in your camera gear.
Leasing is a separate beast.
Your lease payment is a business deductible expense, with no separate deduction for camera depreciation(no double dipping ) So if you take a out a year 12k lease on a camera each $1000 payment is deductible fully in the year, slicking 12k off your yearly income.
However this leaves you with the situation where the payments and deductions may be MUCH more than you are making or can reasonable expect to make off the gear in a lease term. So if you expect a 4 year roi on a camera, you are taking a big deduction the first year, but then will have to pay taxes on the camera income over the next 3 years.
Now finance, vs purchase vs lease.
I started out straight purchasing my gear and for the most part I regret doing this. It makes business cash flow a breeze, but depletes your savings. Depleted savings means less agility, you spend next years money today. Also important it doesn't improve credit. I have some gear I expected to do gang buster business that just wasn't right for most jobs. ( PS don't put the wrong gear on a job because you own it. )
This was a good idea on stuff like an a7sII, audio gear, and other smallish stuff.
Leasing got me my start on going bigger and is a great help. I started leasing a while ago and created a business to do it. The commercial credit I could get as a new business was worthless. I own lots of Canon gear because of their generous leasing terms. ( c300mkII and a set of CinePrimes). there are few options in terms of leasing ( 12 or 24) month finance. This is good and bad. The good is that each job the gear goes out on effective reduces its price. Pay $300 a month, make $250 and you paid $50 for a high end piece of gear. That feels AWESOME. Even if you gear doesn't fully cover the payments, you are getting the gear you want at a discount. So a full kit with cine lenses mostly paid for it's self each month.
Awesome right?
All expect when that $1500 a month payment comes due and you have had 0 work. That is scary and it's hard to remember the good times when the bad times roll in.
Financing
This is my end game. I am only in the beginning of the financing game and it seems to be the best of all worlds.
It took me 3 years to build enough of a business credit history with leasing to get viable commercial credit. Right now interest rates are very low. With good credit you get rates that make long term finance make sense. I have gotten some gear with an expected long ROI but I was able to deliberately select a payment term so that each month I am slightly positive cash wise. So I have a new piece of gear at 650$ a month that is bringing in $675. Realistically it can continue to do that for 5 years, including all interest and extra expenses.
The bonus with this is you pick your own term, shop for your own financing and rate and pick your manufacturer. So you can buy what you want exactly and not just what is being offered monthly at the time. (Get a Sony Body, Cooke lenses and a Preson FIZ without figuring out 3 different programs) you still get the scary months of low income, make wise choices.
But 1st you need an accountant to help you be realistic with what the downsides are. You also need to be in a position to rent your gear to a production. Buying 50k of gear and making it a freebie on existing jobs is a great way to loose a pile of money.
So basically
1) start a company to begin building a corporate history.
2) find an industry centered accountant
3) lease what you can get a hold of and can use
4) after 3 years start financing gear on better terms with commercial credit
e) Don't let your appetite get beyond your business. Just because you can finance a new Sony full frame camera with a set of Cooke i7's doesn't mean you should.
It's interesting how many people seem to pass judgement on cinema camera based solely on specs and compressed youtube sample images.
By that standard the Black Magic Cinema Camera with 4.6k raw blows away the sorry ARRI Alexa XT at nearly 1/20th of the price.
Canon makes good cameras and it is likely that they release a camera that will perform properly for it's price point and target market. It's 6k usd on launch day meaning that it will shortly be 10-20% less. This will be against the fs5 and not the fs7.
Nothing, If you see an under served market and know people who will rent from you, go for it.
Observations like your are how business start.