I asked a contractor if i could ask a few questions, regarding the situation in Iceland and how it affected the company. Here you will see the answers with the contractors words, un edited, and i said that what i was looking for was to hear things as they are for the people. Here you go:

What kind of a company are you running?
I have a small excavation company with one bulldozer and 2 excavators.

Before the crash, how did  things work in this business?
Projects started late. Projects that already put out for invite bids and accepted were postponed. Cost estimates were not in line with pricing. The raise in oil prices were not in the estimated cost of the projects and projects were often not indexed so things did not look good. Especially when both the government and the city of Reykjavik and companies connected to the city like Orkuveita Reykjavikur (Reykjavik utility) put up terms that are very restricting in competing and restricted smaller contractors almost completely from being able to bid on projects. These terms were so that the size of the project was not allowed to be more than 33% over the annual roll of the company/contractor. This has had the effect that only larger contractors have had jobs assigned to them and new companies have little or no chance to get anywhere else than being sub-contractors.

Do you have loans on any of your equipment?
Yes.

How have those loans evolved?
Payments have almost tripled.

How has it been to communicate with the loan owners?
It has been different. One of the loan companies has shown us understanding and consideration, but the other one has the policy that if you are 2 law days past due the contract is revoced, the equipment reposessed and the company made bankrupt.

How was the project/job market for contractors like you before the crash?
Our situation was not bad at all, since we had a project that we started last year. This crash was foreseen late last year by the governors of the banks in my opinion. Banks had loaned with out any problems or limitations almost all last year of 2007, but all the sudden late that fall everything was cut off. We lost one whole year of work that was supposed to be insured, since the project holder could not come up with the loans that were needed to keep the project running.

How have things evolved around the project market since the crash?
Projects that have been out for invite bids from the government were pulled back and all projects were canceled.

Do you think it is a risk factor getting paid today?
Yes i do. Because of the situation everyone is trying to get prices down so some projects are not realistic to work.

What is the situation with oil, and how do you think things will evolve from now?
Oil price was before 10% of the expenses but now it is up to 33%. After the crash you cant have oil unless it is paid cash.

In what areas has this situation affected the practice of your company?
Every area. Collection actions are very aggressive from the parties that we have to deal with, so we are pushing our debts and hoping day to day that we can stand up to the demands so we do not lose our equipment.

Do you think this will affect your practice for some time?
I´m not sure anymore if there is any grounds to continue the practice. These competitive restraints by these rules about invite bids have made all small contract companies like mine dependent on the large companies. Since all the big companies have collected all the projects it has made it easy for them to press down all the rates and i do not expect that to change despite the big companies are not able to finish their projects on time. When they start to tilt over the first thing that suffers is the sub-contractor and they skip the payments to them, who are then facing unpaid demands that nothing comes in to finish. The demands of sub-contractor are at the bottom of the list if the big company goes to bankruptcy.

What is your opinion and thoughts about the statement that the government made about making it easier for companies to get funds to continue practice after the crash?
That is the whitest lie i have ever heard.

Have they come through with that statement?
No.

What have the authorities done for companies after the crash that you know of?
If you are talking about the government, then that is nothing. My company is just a little guppy in the Atlantic ocean. IRS and Customs have been relaxing their collection actions. But you have to talk to them on a regular basis of course.

What do you think is necessary to do to help companies stay in practice?
Create work. Not pull projects back that have been advertised like has been done now and postponed for undefined time or just canceled.

What is the process of getting a loan frozen for equipment?
To get a loan frozen you have to have all your payments up to date. If i am to compare to how many companies have lost their equipment and sold out of the country i cant see that there is a working process at hand.

Is it possible to plan ahead and if so have you made any plans?
No, i do not think so. Unless you have projects that due for long enough that you can get up to date on your payments that have doubled and tripled and get other debts down as well.

What are your hopes about the future in this?
That we have projects and we do not lose everything we have. The future view is very dark at the moment, especially since the government has stated that the loans they are getting are not going into the society, just to pump up the currency and the government financial status.

What would you like to see done?
That the individuals that opened on this evolvement here stand up and admit their mistakes and see to it that the common citizen are not made to pay for the WANNABE RICH SYNDROME that seized those individuals that were in a position to play monopoly with their fake money but are able to walk away unharmed but a whole nation is left in wounds. Ministers made to tell the truth and take the responsibilities. Same with the governors in the Central Bank. When the government sold the banks on fire sale to their friends at that time, that was stage 1 to this situation. When the banks were let into the real estate market i was sure that everything would go downhill from there, and that was step 2. When the government and Central bank opened for the out-break completely they doomed us to this fate. There are individuals that have to resign, it is also necessary to fire the governors of the Central Bank and hire ONE central bank governor. Hello. There is no need for a central bank governor per 100.000 Icelanders.

What idea do you have for a solution for you and your company?
I would like to be able to export my company to another country where there are business ethics valid. Norway is on the top of my list. I do not know if there is a chance for that. I would like to export all of the practice with me, and my employees. I have lived abroad and i never thought i would move again my children were being raised in a safe environment. That safety is not at hand anymore. I was a proud Icelander, now i´m just proud. If this opportunity is not available, i wont have any other choice than just try to stay afloat and sell with the hope that i do not lose everything. According to how much of equipments are being sold out of the country i might be able to sell mine without loosing everything and sitting behind with big debts on my back after. If it happens i think i will move abroad, the wages here are unrealistic and no jobs to have.

A year ago our debt was around 9 million ISK of one of our equipments, today it is somewhere between 16-17 million ISK.

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Translators/Website owners comment:

If you know someone that needs to hire a company like this one, send me an e-mail since this company is ready to relocate with their equipment and staff if they get a job offer. Send me an e-mail to This e-mail address is being protected from spambots. You need JavaScript enabled to view it and set in the topic CONTRACTOR.