LOCAL businesses buckling under the strain of continued trade following Macalister Constructions being placed into administration have told of their disappointment at being “lied to” for months.
One Latrobe Valley-based plasterer and tiler, whose business employing six people folded amid mounting unpaid accounts by Macalister Constructions, said the trust inherent in the way Latrobe Valley businesses worked with one another had been undermined and warned other businesses to “be more prudent now”.
“We have folded, we were left with no option and I have had to seek employment elsewhere,” he told The Express.
“But the worst part was the continuing lies… being told money would be coming and it never arrived. You would ring, and go and see them and just get nowhere… Macalister really screwed me, at one point we sweated for months waiting on $75,000 from Christmas through to Easter, we were begging for money… you can’t provide for your family like that,” he said.
Despite expressing confidence his business would “do it tough” but survive the impact of Macalister Contructions’ woes, Laser Plumbing owner Daniel Smolenaars said investment would be slow and cash flow would need to be managed well.
“A lot of people have been aware of (the problems with Macalister Constructions) for some time… but people have wanted to help, it has not been stupidity, they have really wanted to see them trade their way out,” he said.
Mr Smolenaars described himself as a “mid-range creditor” yet estimated he was owed “in excess of a hundred thousand dollars”, despite stopping work for Macalister Constructions 18 months ago. He said he believed there were “millions and millions” owed in total.
“In amongst the mire though, we are Gippslanders and we are resilient and we will get over this… it will take time and we will all have to be more prudent, particularly coming off the back of such a tough economic climate and the (collapse of) Kirway (Constructions) last year,” Mr Smolenaars said.
Another business owner, who had been working with Macalister Constructions “since day one”, said he had “stuck with them in the ‘bad’ because of the ‘good’… we have been through thick and thin which is why it is so disappointing to be lied to and for arrangements to be made when they knew they couldn’t pay yet they kept asking for work to be done and kept breaking promises”.
Another small operator, who said he was owed about $40,000, raised concerns about the 90-day account payment cycle he said was now “standard practice” for larger building companies.
“That was how Macalister operated,” he said.
“They acknowledged the bill at the end of the month and then wanted 60 days to pay it so in those 90 days tradies can be doing anywhere up to $100,000 worth of work… these companies are building off our finances and if they don’t pay at the end of that 90 days, we can’t go on… we still have to be pay our workers and their super every week.”
“The profit mark-up for us smaller companies is about 10 to 15 per cent at best, so we can’t absorb the interest rates on overdrafts to carry the burden of financing their work,” he added.
It is believed among the list of Macalister’s creditors are Dahlsens, a Morwell-based equipment hire company, local quarries and concretors including GBG Concrete.