Company collapses with $2.5m debt

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Economy Issues Nouvelles

Cost Crisis,Australian Taxation Office,Melbourne

A company involved in the construction industry has gone bust leaving it $2.5 million in debt.

A “chain reaction” from other companies going bust and a challenging environment has forced an 18-year-old firm to go under.Melbourne-based company MadeCo, which was responsible for kitchen manufacturing, went into voluntary administration with 30 employees impacted.

“In essence the company which operates in the construction space – and the construction space always has financial difficulties, especially through and on the back end of Covid and general economy issues like increasing supply costs, wages, the supply of labour, getting staff and all those sorts of things – it was those sorts of things that impacted it,” he said.

“Obviously it’s very difficult if you have placed an order and they wait a month or two for your kitchen and then you are told you are not going to get your kitchen. A creditors meeting on April 17 is likely to see the 18-year-old company tipped into liquidation, Mr Langdon said. News.com.au has reported on dozens of builders going into administration and liquidation over the past two years.

Indeed, of the 8471 business collapses for 2023, almost 28 per cent were in the building and construction industry, according to data put out by the corporate regulator.“It’s had issues to do with supply challenges, labour, competition for labour – a lot of staff have gone on to government projects in the city with the rail and the tunnel – and with interest rates, it’s a very difficult industry,” he noted.

 

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