deposit reduction

[Vinniem]

Had a customer email me today and request to have the required deposit to start his job reduced to half (from $1000 to $500) and say he'll give the remaining $500 at a latter date, towards the end of the job.

Struck me kind of odd. First time for me.

Have any of you had similar requests?

[satcom]

Had a customer email me today and request to have the required deposit to start his job reduced to half (from $1000 to $500) and say he'll give the remaining $500 at a latter date, towards the end of the job.

Struck me kind of odd. First time for me.

Have any of you had similar requests?

The warning flag just went up, this could be a problem customer when it comes to final payment. Your are not in the credit business, if he has monney issues he should find his own money.

[wshoard]

Every single time I've tried to help someone out like that it bites me.

Remember: no good deed goes unpunished ;)

[Rewire]

Could be someone told him that was to large a deposit for the job and he is trying to cover himself or he could have cash flow problem and this could make collecting at jobs end an issue.If you want an answer you got to ask the question,go to homeowner and ask why.

[pgordon]

What % of the job is the $1000 ???

[kkwong]

I would ask for a reason why he requested the reduction. In the past I've had customers do this with mixed results. Most have bit me in the butt but if this is a long time customer, then perhaps he is having financial issues.

If you do decide to halve the deposit, inform him both verbally and in writing that he is responsible for the other half at a date that you both agree on or you'll add the other half and a late fee on top of that. I would also suggest getting it noterized or have a lawyer help you draft the document.

[480sparky]

If you agreed you were to get paid $1K to start the job, then the customer needs to fork over another 500 clams before you can start.

Don't back down now! It's waaaaay to early in the game!

[Vinniem]

Total job 2130

1000.00 upon signing of contract

$500.00 upon completion of rough work prior to rough inspection

$500.00 upon completion of finish work prior to final inspection

$130.00 balance due after final inspection approval

[celtic]

I would offer to start the job at a latter date...when the deposit moneys have been forked over :)

[Dennis Alwon]

I have never asked for a deposit before the job and I would be reluctant to pay a deposit before any work is done. It is not done around here.

[KP2]

If the customer is concerned about you not starting the job after he pays, like some homowners are. Agree to the 500 deposit but make the rough payment 1000.00 and meet him in the middle.

[Rewire]

Total job 2130

1000.00 upon signing of contract

$500.00 upon completion of rough work prior to rough inspection

$500.00 upon completion of finish work prior to final inspection

$130.00 balance due after final inspection approval
I can see the customer getting cold feet about forking over almost half the money up front.Looking at your breakdown taking the 500 at the beginning and then 1000.00 at rough in (I usually get inspection first) would be a counter offer.

[220/221]

50% down. Rare exceptions.

Just because they asked would not qualify.

[satcom]

I often wonder why our industry is looked at as a cheap labor pool, rather then a respected craft, and some of this may be our poor business practices, contracting for work costs money, and asking for a hefty deposit, is a smart businness move, every project will require a different deposit, depending on material needs, and labor burdens, your in business, and the business can't continue to operate without cash flow and profits.

I sit here and shake my head at times, wondering how some are making a living, and paying their expensies with the way they are operating their business.

[cschmid]

That must be real small job..you can not wire a house for that..yet you and owner must be on same page in writing..so you need to have face to face and find out whats up..make sure you are ready to give money back if you are uncomfortable with answers..there are other fish to fry..I hope yet sometimes work gets slow and tough to find if owners has got someone who said it could be done cheaper you got some issues coming..

[Vinniem]

Thanks for the replies guys.

I agree with you satcom.

We are in business, not charity.

The less money that has to come out of my pocket the better.

Me personally, I don't see how many contractors start a job without a deposit. (contracted work, not service calls)

But I will follow the advice and make the payment after the rough inspection 1000 dollars instead of 500.

Again, thanks to all who replied.

[ceknight]

I have never asked for a deposit before the job and I would be reluctant to pay a deposit before any work is done.

Same here. If it's a big job, I'll get a progress payment after the rough inspection, but mostly I just bill when the job's done and the customer's happy.

Your mileage may vary,

[bkludecke]

I have never asked for a deposit before the job and I would be reluctant to pay a deposit before any work is done. It is not done around here.

We operate the same way. I do the work, you're happy, you pay, we're both happy.

[EBFD6]

I always get a deposit, enough to cover at least material costs. My thinking is if I get stiffed on the job at least I can still pay the supply house and I won't get a lean put against my house or something. Most supply houses I deal with want to get paid in 30 days and I don't want credit issues because of a customers possible financial problems. If a supply house shuts you off over one job, it is going to inhibit your ability to do other jobs.

[dduffee260]

I have never asked for a deposit before the job and I would be reluctant to pay a deposit before any work is done. It is not done around here.

Ditto Dennis, we have never recieved any deposit money up front. I would never pay anyone money up front for work they had not performed, especially 50%.
We do mostly medium size projects. We have to go by work performed or materials stored on site for our payments. If paments start to run late we can notify the bonding company or the owner and thins usually get fixed. This is always the way things have been in this type of work.
With a home owner you have a different type of situation. Some may pay a percentage down. Personally I would not because I have seen nd heard of too many cases where the person takes the deposit and never comes back to work.

[ItsHot]

I always get a deposit, enough to cover at least material costs. My thinking is if I get stiffed on the job at least I can still pay the supply house and I won't get a lean put against my house or something. Most supply houses I deal with want to get paid in 30 days and I don't want credit issues because of a customers possible financial problems. If a supply house shuts you off over one job, it is going to inhibit your ability to do other jobs.This has been mentioned in other post! Why should the contractor have to pay for the materials. Why do so many customers act as they are doing us a favor to do work for them?

[satcom]

Ditto Dennis, we have never recieved any deposit money up front. I would never pay anyone money up front for work they had not performed, especially 50%.
We do mostly medium size projects. We have to go by work performed or materials stored on site for our payments. If paments start to run late we can notify the bonding company or the owner and thins usually get fixed. This is always the way things have been in this type of work.
With a home owner you have a different type of situation. Some may pay a percentage down. Personally I would not because I have seen nd heard of too many cases where the person takes the deposit and never comes back to work.

I think it's great, some of you guys live in Disney land, where everyone is the perfect customer. But out in the real world, it does not work that way, good thing you don't live in the North east, and need a roof replaced, they want 50% or more of a huge sum, before they drop off anything, remember the dumpster guys will not drop off a dumpster without a deposit. Must be nice to live in dream land.

I was wone of those dreamers when I started out, and I still have the bank debt to pay off from dead beat not so dreamey customers.

[Dennis Alwon]

I was wone of those dreamers when I started out, and I still have the bank debt to pay off from dead beat not so dreamey customers.

It's not dream land. It is learning how to pick and choose your customers. I have been in business for 30 years and I have less than $200.00 in debts that I did not collect. That customer went bankrupt and called me and told me to come by and take some frozen fish before the collectors came and took everything. I know many others who have lost money so it is not the area -- we have crooks here also.

I think I told this story before that when I first started I had a potential client who called me to wire his new home. I was hungry for a new construction work. When he said he would supply the materials my appetite suddenly went away. I knew he owned a restaurant so I said "If I bring a steak into your restaurant will you cook it for me?" He said "what do you mean?" I told him I think he knows what I meant and to get someone else.

This guy has screwed a lot of people of money over the years.

Back to the OP---If someone wanted 50% down to work in my house they would have to leave their spouse and kids as collateral. This may not work either depending on how much they likes their family.:grin:

[celtic]

When did EC's become SLA's?

http://www.yankeetraderfolkart.com/bailey.jpg

[ceknight]

When did EC's become SLA's?


I'd like to assume you wouldn't order pizza more than once from a shop that made you pay before they'd even consider baking and delivering it. But you seem to favor a model where the customers should do exactly that...? :)

[celtic]

I'd like to assume you wouldn't order pizza more than once from a shop that made you pay before they'd even consider baking and delivering it. But you seem to favor a model where the customers should do exactly that...? :)

Ever been to MickeyD's....bought a car...a house...etc.


At what point do you become a banker and not an EC?

[mdshunk]

Even at McDonald's you need to pay at the first window before you can pull up to the second window to get your food.

[growler]

I have never asked for a deposit before the job and I would be reluctant to pay a deposit before any work is done. It is not done around here.

I will admit that a job costing $2130 total I'm probably not going to ask for anything up front either. If I think it's real risky ( house has a for sale sign in front) I will want everything up front but I don't get many of those.

If the job only cost $2130 I shouldn't be there over two times before I'm ready for the rough inspection and it's time to collect. At that time ( probably some delay from rough to trim) it's good to collect the bulk of the total which could be from $1500 to $1800 with the rest due at final.

If the job is going to be finished in a week or two then I only bill for total ( dealing directly with the homeowner).

On the other hand if the job is bigger and you are working for a GC then it's better to get all you can as soon as you can. In this state GC's are a dime a dozen and many of them will run out on you if you give them a chance.

[Rewire]

If you stay in business long enough you will get stiffed by someone,we do alot of small remodels for many different customers as well as contractors so the odds go up for us. I want money the day the job starts normally 25% this does not me3an I wont get stiffed it just means I got something I was owed a final payment of 1500$ and the homeowner stiffed me still waiting for a resolution a year later.

[peter d]

I'd like to assume you wouldn't order pizza more than once from a shop that made you pay before they'd even consider baking and delivering it. But you seem to favor a model where the customers should do exactly that...? :)

Pizzas cost $10 retail, much less for the ingredients and labor. Most electrical work costs a lot more than $10.

Besides, you have to pay them first before they'll bring it to the counter. Or the delivery driver has to pay the shop for it before they'll send it out. Either way, they get their money up front.

[Krim]

If the customer is concerned about you not starting the job after he pays, like some homowners are. Agree to the 500 deposit but make the rough payment 1000.00 and meet him in the middle.

This is the same thought I'd had about the situation and sounds like a more reasonable / realistic solution .
Carl :)

[pgordon]

Sometimes We will buy the whole job,(materials) and deliver it to the job site, then recqustion for the materials pluse 20%. Just try and get the state to give you a deposit on a job, Then its progress drawing time.

[satcom]

This is the same thought I'd had about the situation and sounds like a more reasonable / realistic solution .
Carl :)

All Nonsense, there is no need, for him to reduce the down payment, he is in New Jersey, where electrical contractors are licensed, and bonded, should he fail to complete any job, he would have his license pulled by the board, and face excessive fines, and penalties.

[iwire]

IMO this subject has no right answer, situations are different for different jobs.

When I hired a contractor to do my roof he wanted 1/3 down, 1/3 at the 50% done point and the final 1/3 when I was satisfied.

Considering he did not know me, and I did not know him it seemed like a fair arraignment for both of us.

I hired a mason and gave him about 1/4 to get started, the balance on complition....it was a only couple of days work.

I would never pay a contractor in full or more then 50% up front no mater what license they hold.

[iwire]

he is in New Jersey, where electrical contractors are licensed, and bonded, should he fail to complete any job, he would have his license pulled by the board, and face excessive fines, and penalties.

So no one ever gets ripped off by contrators in NJ?

Companies do not go out of business?

I find that hard to believe....nothing against NJ in particular....just the human race in general.

[ceknight]

Ever been to MickeyD's....bought a car...a house...etc.

Those are all transactions where you get the goods at the end of the transaction.

Have you ever gone to McDonald's, had them ask for money and tell you to show up tomorrow and they'll give you your DeathBurger at Window 2? Have you ever bought a car from a dealership that told you to pay cash now, and they'll show up in your driveway with the car next week? Have you bought any houses where you signed all the papers and had to pay cash for it a week before you get the house keys? If you want your counterexamples to be relevant, you need to make them analogous... :)

My general point is that the materials don't belong to the customer until you're at least on site with them and prepared to let them assume ownership. I don't expect a customer to pay for materials before I've installed them. What happens to those materials before then is a risk I take as a businessperson -- the customer does eventually pay for that risk, it's passed along as markup. But between the shop and the customer's building it's my risk.

Expecting a customer to absolve you of the legitimate up-front risks of running a business is, to me, outlandish. But then I don't share the profits I reap from taking those risks with my customers, either. :)

I'll only add one more thing: What is the difference, in principle, between (a) showing up at a job, getting a check before you unload the van, and then starting work, and (b) showing up at a job, starting work, and getting a check at the end of the day? Would you consider one to be non-banking, and the other to be banking? Either way you're on site with an un-cashed check, only in one case it's a "deposit" and in the other it's a "progress payment." You've still charged the goods on your shop account, and you haven't got the money in the bank yet.

I see the only real difference as one of perception -- in one case the customer perceives you as either (or both) needing money and not trusting them, in the other the customer perceives you as trusting them and operating a business that isn't hand-to-mouth. That's how I see it, and it's my business model to form lasting, trusting relationships with my customers. I especially don't want them perceiving me as needy.

Your mileage may certainly vary. :)

[480sparky]

IMO this subject has no right answer, situations are different for different jobs.

When I hired a contractor to do my roof he wanted 1/3 down, 1/3 at the 50% done point and the final 1/3 when I was satisfied.

Considering he did not know me, and I did not know him it seemed like a fair arraignment for both of us.

I hired a mason and gave him about 1/4 to get started, the balance on complition....it was a only couple of days work.

I would never pay a contractor in full or more then 50% up front no mater what license they hold.

So, in effect, you had a 'meeting of the minds' in those cases, and your agreements were turned into contracts. You both understood, and agreed to, the terms of that contract.

If the OP has a contract with the HO, then both parties should follow it. If the HO wants to change it, he must do so in writing, and the OP must agree to it. Nothing wrong with changing, but, like all the afternoon TV judges like to say, "Get it in writing."

[satcom]

IMO this subject has no right answer, situations are different for different jobs.

When I hired a contractor to do my roof he wanted 1/3 down, 1/3 at the 50% done point and the final 1/3 when I was satisfied.

Considering he did not know me, and I did not know him it seemed like a fair arraignment for both of us.

I hired a mason and gave him about 1/4 to get started, the balance on complition....it was a only couple of days work.

I would never pay a contractor in full or more then 50% up front no mater what license they hold.

It is different for different jobs, material heavy jobs, may require a larger deposit, a risky credit wise customer may also require a larger deposit.

[satcom]

So, in effect, you had a 'meeting of the minds' in those cases, and your agreements were turned into contracts. You both understood, and agreed to, the terms of that contract.

If the OP has a contract with the HO, then both parties should follow it. If the HO wants to change it, he must do so in writing, and the OP must agree to it. Nothing wrong with changing, but, like all the afternoon TV judges like to say, "Get it in writing."

Exactly! I assume the OP must of seen a need for a larger down payment.

[jrannis]

I have never asked for a deposit before the job and I would be reluctant to pay a deposit before any work is done. It is not done around here.

Not everybody lives in a nice place like Chapel Hill.

I would tell them that its against company policy.

[jrannis]

Those are all transactions where you get the goods at the end of the transaction.

Have you ever gone to McDonald's, had them ask for money and tell you to show up tomorrow and they'll give you your DeathBurger at Window 2? Have you ever bought a car from a dealership that told you to pay cash now, and they'll show up in your driveway with the car next week? Have you bought any houses where you signed all the papers and had to pay cash for it a week before you get the house keys? If you want your counterexamples to be relevant, you need to make them analogous... :)

My general point is that the materials don't belong to the customer until you're at least on site with them and prepared to let them assume ownership. I don't expect a customer to pay for materials before I've installed them. What happens to those materials before then is a risk I take as a businessperson -- the customer does eventually pay for that risk, it's passed along as markup. But between the shop and the customer's building it's my risk.

Expecting a customer to absolve you of the legitimate up-front risks of running a business is, to me, outlandish. But then I don't share the profits I reap from taking those risks with my customers, either. :)

I'll only add one more thing: What is the difference, in principle, between (a) showing up at a job, getting a check before you unload the van, and then starting work, and (b) showing up at a job, starting work, and getting a check at the end of the day? Would you consider one to be non-banking, and the other to be banking? Either way you're on site with an un-cashed check, only in one case it's a "deposit" and in the other it's a "progress payment." You've still charged the goods on your shop account, and you haven't got the money in the bank yet.

I see the only real difference as one of perception -- in one case the customer perceives you as either (or both) needing money and not trusting them, in the other the customer perceives you as trusting them and operating a business that isn't hand-to-mouth. That's how I see it, and it's my business model to form lasting, trusting relationships with my customers. I especially don't want them perceiving me as needy.

Your mileage may certainly vary. :)

I dont know if I would start a normal job without a deposit. If you are doing small 5k or 10k jobs you dont have much risk I guess.

[tyha]

put it this way. here in north carolina business isn't done that way. it isn't about the different projects or types of customers. Its just for whatever reason in different parts of the country business is handled differently. we have had this discussion on many levels in the past with the same outcome. If you were to come to nc and ask for deposits on your work you wouldn't stay in business long because you wouldn't have any customers and maybe if we were to go to the north east and do all this work and just bill progressively than i really dont know what would happen. I am used to swinging several thousand dollars every month and (sometimes a few months with slow pays) but i feel that I am well compensated for doing it.

[macmikeman]

put it this way. here in north carolina business isn't done that way. it isn't about the different projects or types of customers. Its just for whatever reason in different parts of the country business is handled differently. we have had this discussion on many levels in the past with the same outcome. If you were to come to nc and ask for deposits on your work you wouldn't stay in business long because you wouldn't have any customers and maybe if we were to go to the north east and do all this work and just bill progressively than i really dont know what would happen. I am used to swinging several thousand dollars every month and (sometimes a few months with slow pays) but i feel that I am well compensated for doing it.

That is probably because North Carolina (notice the caps on mine;) ) is close to Murphy Village in the next state down. http://fraudtech.bizland.com/travelers.htm

[brian john]

We have the opposite problem every year we have customers that need work completed by year end, usually due to scheduling issues this is not possible.
Like a two month job they we are awarded the second week in December. Then they ask, well can you at least bill me so it makes it into this years budget.


NOW LET ME SEE you want to prepay?......HMMMMMM I might be able to do that. One customer asked if we minded if they held 10% retainer, AHHHHH no problem.

[dduffee260]

I think it's great, some of you guys live in Disney land, where everyone is the perfect customer. But out in the real world, it does not work that way, good thing you don't live in the North east, and need a roof replaced, they want 50% or more of a huge sum, before they drop off anything, remember the dumpster guys will not drop off a dumpster without a deposit. Must be nice to live in dream land.

I guess that is the advantage I have for working with people like Mickey and Minnie Mouse and you doing work for Tony Soprano. It's a beautiful ting !!!

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[satcom]

I think it's great, some of you guys live in Disney land, where everyone is the perfect customer. But out in the real world, it does not work that way, good thing you don't live in the North east, and need a roof replaced, they want 50% or more of a huge sum, before they drop off anything, remember the dumpster guys will not drop off a dumpster without a deposit. Must be nice to live in dream land.

I guess that is the advantage I have for working with people like Mickey and Minnie Mouse and you doing work for Tony Soprano. It's a beautiful ting !!!
When you go to a fast food place in your area, do they give you the food then ask you to pay after the food is consumed, or do they demand payment before they give you the food?

This issue is a two way thing, there are contractors that will rip off customers, and leave them with a mess, and there are contractors that provide good services, and they need to protect their business, by using standard contract practices and terms.


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[charlie tuna]

i agree with i-wire--there's no right answer. it hinges on many things -- area is one of them, there are areas that people are more honorable than others. another issue is how bad you need the work -- if your sittin at home with no work it might be worth the gamble, and you'll be out of your wife's hair!! another thing is profit margin-- if their $500. to be made that might make it worth your while, but for $50. it isn't worth the worry alone!!

gut feeling just didn't work for me -- every time i got screwed -- it was always-ALWAYS--when i least expected it and when i went the extra mile to help someone out. one thing i did do -- when i had a "nickel dimer" or people who scrutinize everything on a bill, i always increased their next bill's profit margin! something my previous boss taught me -- he used to call it "aggravation costs".......

remember, we are "contractors" and there are many people who just don't trust "contractors" --- others have given us a bad reputation by screwing these people --- these people may just be trying to protect themselves from a previous "contractor" deal???

[aline]

Have you ever gone to McDonald's, had them ask for money and tell you to show up tomorrow and they'll give you your DeathBurger at Window 2? Have you ever bought a car from a dealership that told you to pay cash now, and they'll show up in your driveway with the car next week? Have you bought any houses where you signed all the papers and had to pay cash for it a week before you get the house keys? If you want your counterexamples to be relevant, you need to make them analogous... :)
What would happen if I ordered a burger, ate it and then left without paying for it?

What would happen if I went to the grocery store loaded up my cart and left without paying for it?

What would happen if I filled up my car at the gas station and then refused to pay?

The police would be called and you would be arrested for theft or shoplifting.

After I install my materials for a customer and he doesn't pay I can't call the police and have him arrested for theft.

When I purchase a car from a dealership I get the car but not the title unless I've paid for it in full. If I don't make the payments the car gets reposessed. I don't actually own the car until I've made the final payment. Same thing when I buy a house. The car dealership and the bank have something of value they can reposess in the event you don't pay.

When I install materials they then become the customer's materials whether I've been paid or not. I cannot reposess these materials and even if I could, a lot of what I've put into a job is in labor. How do you reposess labor?

I recently completed two jobs that were $2500 each. In both cases I wanted a $500 deposit before starting the work. In both cases the customer balked about the deposit. One was some dedicated circuits for a pizza company and the other a residential service upgrade. They seemed like nice trustworhty individuals. The residential customer used to work at the same industrial plant that I used to work at and we knew each other. Against my better judgement I waived the deposit requirement. Three months later I have not been paid a dime from either one.

I would love to be able to rip the electrical service off the guys house and reposess my materials but It's illegal to do so. Once the materials are installed they become the customers. We're not allowed to touch the power companies overhead drop or meter. I once cut a meter seal in the middle of the night, called the power company the next day and told them I had cut the seal and that they would need to put a new one on.

They reamed my up and down, threatened me with a hefty fine and threatened to have my licensed revoked.

I can lien the home of the residential customer but this doesn't mean I will get paid anytime soon.

I'm not sure what I can do about the pizza company other than take them to small claims court. They don't own the building but lease it instead.

So unlike a house or a car I don't have a title to anything and have nothing to reposess or foreclose on. Even if I could reposess my materials I can't reposess my labor.

If nothing else asking for a deposit and having a customer not willing to pay for it, is a good warning sign that the customer isn't going to pay for any of the job.

When I had my graphics put on my van I was required to pay a 50% deposit before they would begin the work.

Would you order a $15,000 generator without getting a deposit upfront? What happens when the generator shows up and the customer tells you he's changed his mind, doesn't want it and refuses to pay for it?

I know a lot of companies will not order anything for you without a deposit.

If you're a local contractor running around collecting deposits and not completing any work you're not going to be in business very long. The customer should be able to do a little research on the contractor he's hiring to see if he has had any complaints about him, how long he's been in business and if he's established in the area. The type of contractors that run around collecting deposits and never completing any work usually travel from state to state and don't have an established business in the area.

[dduffee260]

When you go to a fast food place in your area, do they give you the food then ask you to pay after the food is consumed, or do they demand payment before they give you the food?

I don't eat fast food, it is unhealthy. When I go to Texas Roadhouse and order a 12oz filet. They bring me my food first, then I order desert, they bring that too me also. Then they bring me the bill, I pay for it. If there is something wrong with the food when they bring it out, I ask for a manager, They make sure I am happy before they give me a bill. There is no excuse not to pay when they do that. If they asked me for a down payment on the food before they started cooking. I would leave the place.


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[satcom]

another issue is how bad you need the work -- if your sittin at home with no work it might be worth the gamble, and you'll be out of your wife's hair!!


That is one sure way to get in trouble, if you sitting at home with no work, you would be better off, out looking for profitable work, then changing your terms, or cutting your profit, however, this is exactly what some do, when things slow down, they react, thinking oh well at least i will have something, will you really gain by doing that, check your figures, and you will find, you usually loose money in the long term, by accepting work in a panic mode.

[aline]

I don't eat fast food, it is unhealthy. When I go to Texas Roadhouse and order a 12oz filet. They bring me my food first, then I order desert, they bring that too me also. Then they bring me the bill, I pay for it. If there is something wrong with the food when they bring it out, I ask for a manager, They make sure I am happy before they give me a bill. There is no excuse not to pay when they do that. If they asked me for a down payment on the food before they started cooking. I would leave the place.
What would happen if you ate all this food and then just got up and walked out without paying for it?

As a contractor I've done all the work, made sure the customer was happy and even had the customer comment on how pleased he was with the work but still didn't get paid. His excuse? He just doesn't have the money right now. I guess that's why he balked about the $500 deposit. He didn't have the money.

Try telling the Texas Roadhouse manager you just don't have the money right now after ordering and eating all that food.

[satcom]

If nothing else asking for a deposit and having a customer not willing to pay for it, is a good warning sign that the customer isn't going to pay for any of the job.

When I had my graphics put on my van I was required to pay a 50% deposit before they would begin the work.

Would you order a $15,000 generator without getting a deposit upfront? What happens when the generator shows up and the customer tells you he's changed his mind, doesn't want it and refuses to pay for it?

I know a lot of companies will not order anything for you without a deposit.



I do not expect someone that is not in business to grasp these practices, they have a one side vier of contracting at best.

[ceb]

put it this way. here in north carolina business isn't done that way. it isn't about the different projects or types of customers. Its just for whatever reason in different parts of the country business is handled differently. we have had this discussion on many levels in the past with the same outcome. If you were to come to nc and ask for deposits on your work you wouldn't stay in business long because you wouldn't have any customers and maybe if we were to go to the north east and do all this work and just bill progressively than i really dont know what would happen. I am used to swinging several thousand dollars every month and (sometimes a few months with slow pays) but i feel that I am well compensated for doing it.

Don't be too quick to make that statement. I require a deposit on my larger jobs, for example if I quote a new construction home my terms are 60% at rough in 40% at final plus addons, however when I quote the job their has not been any work started and I know that it will be up to 3 months before they are ready for the elect. to begin. That is when I have in the quote that due to ever changing wire price that I require a 20% deposit with in 30 days to buy the wire or the quote is void. I have been hurt by not requiring a small deposit to at least buy the wire at today's price only to have it increase by the start of the project.

[tyha]

im not trying to offend anyone or say what they are doing isn't the way to conduct business but I think that for one we are on different sides of the realm. We dont do residential. We consistantly do projects from $10,000 to $200,000. If I dont invoice $75,000 a month Im upside down. There are many reasons for this when it does happen. I would like to know if anyone on this forum ,that we have been going back and forth with, requires a deposit and does the volume we do. Now the case of the gen-set or other types of special equipment is different. I would require some sort of deposit on that as well.

[emahler]

im not trying to offend anyone or say what they are doing isn't the way to conduct business but I think that for one we are on different sides of the realm. We dont do residential. We consistantly do projects from $10,000 to $200,000. If I dont invoice $75,000 a month Im upside down. There are many reasons for this when it does happen. I would like to know if anyone on this forum ,that we have been going back and forth with, requires a deposit and does the volume we do. Now the case of the gen-set or other types of special equipment is different. I would require some sort of deposit on that as well.

a little off topic, but interesting, is that up in NY/NJ area, you would need to bill nearly twice as much every month based on the # employees you have (upwards of $130k month) and thats not getting rich...just an observation...carry on

[tyha]

i know that to be true. The wages and cost of living are higher there. Right??Im saying I break even at 75K. meaning that I just will have enough from that to roll pay roll and misc cost for the following month without taking funds from somewhere they need to stay. The way I have always gauged our industry from my standpoint as a PM with other multi-million $ ec's and with my own company is 100k in sales per year average for every full time field position and 1 full time estimator per 10 field employees. project managers are somewhat arbituary because I , like some other ec's I know, manage most all of our work in one way or the other with maybe 1 full time salaried pm and a few really good meticulious foreman. Is this similar to NE or no. Im thinking no

[satcom]

i know that to be true. The wages and cost of living are higher there. Right??Im saying I break even at 75K. meaning that I just will have enough from that to roll pay roll and misc cost for the following month without taking funds from somewhere they need to stay. The way I have always gauged our industry from my standpoint as a PM with other multi-million $ ec's and with my own company is 100k in sales per year average for every full time field position and 1 full time estimator per 10 field employees. project managers are somewhat arbituary because I , like some other ec's I know, manage most all of our work in one way or the other with maybe 1 full time salaried pm and a few really good meticulious foreman. Is this similar to NE or no. Im thinking no

Your figures are way off from anything you would need here, a shop here just bit the dust last year, they had one estimator for 70 field employees.

[jrannis]

Typical small job with terms and payment schedule

In accordance with your request, ------- proposes to furnish all necessary labor, tools and material for a complete and operational electrical installation for the above referenced project per our site review along with the following listed qualifications:

1. Install new high-leg wire into existing riser conduit and terminate in existing line gutter
2. Install new three phase meter and new three phase distribution panel for East warehouse unit and connect into line gutter
3. Disconnect old single phase meter
4. Connect existing 100 amp panel to new service in meter room
5. Install new three phase 100 amp panel in warehouse, back to back with new three phase distribution panel located in meter room
6. Contractor level design drawings for permitting included
7. Fees from FP&L are specifically excluded. (none anticipated)
8. Permit, Processing, and any fees or penalties imposed by The City of Oakland Park associated with this project shall be the responsibility of the owner.
9. Patching, painting and restoration of landscaping or finished surfaces by others.
10. Any additional work required by the local building authority not specified in the above scope of work shall be the responsibility of the owner.(none anticipated)
11. Additions or changes to the above scope of work are considered separate from the initial project agreement. (none anticipated)

Terms: $800.00 at the commissioning of drawings and calculations, $1,100.00 when permit is issued and work scheduled 700.00 at the substantial completion of pipe, wiring and testing.
Our price including for the above mentioned project terms:
TWO THOUSAND SIX HUNDRED DOLLARS ………………..……………… $2,600.00

Approved and accepted:
The above prices, specifications and conditions are accepted. ----- is authorized to work as specified. Payments shall be made as outlined above. In the event of a lien or other legal measures are commended to secure payments on any portion of the contract sum, the prevailing party shall be entitled to receive all costs and reasonable attorney fees


X______________________________ ________________________________ ____/_______
Owner signature Printed name and title Date

Respectfully submitted,

-------

[iwire]

$800.00 at the commissioning of drawings and calculations, $1,100.00 when permit is issued and work scheduled

So you want better then 2/3s before anyone has turned a screw driver?

If I was the customer I would pass on that one.

700.00 at the substantial completion of pipe, wiring and testing.


I also would never pay in full until the job was 100% complete including inspections.

That is my view as a customer, I have never owned or run a business.

[jrannis]

So you want better then 2/3s before anyone has turned a screw driver?

If I was the customer I would pass on that one.



I also would never pay in full until the job was 100% complete including inspections.

That is my view as a customer, I have never owned or run a business.

I can offer banking services but it costs more than electrical work

Also,
Waiting for a final inspection can be fatal if the inspector nails them for something outside of the scope of work or if other factors outside of my control arise and delay the final inspection.
Also, the customer will have full use and operation of my work and materials while I am paying the bills.
I cant remember anyone trying to negoiate me off of my terms.

I look at it this way, I you want the work done, you set up some funds for us to work out of, when the work is completed and you have use of it and pay for it, then we can call for a final inspection.

[emahler]

So you want better then 2/3s before anyone has turned a screw driver?

If I was the customer I would pass on that one.



I also would never pay in full until the job was 100% complete including inspections.

That is my view as a customer, I have never owned or run a business.

NJ law has changed some years ago, which caused us to change our payment terms...

NJ law requires final payment be held until final inspections...now they really doesn't play in small service work (service upgrades included)...

but on larger projects, we used to do the standard 1/3 start, 1/3 rough, 1/3 finish...

now we do the same, exept, we take 5% off the top for the final payment, and break the other 95% down into 3rds...so, after we are done, we leave 5% on the table until inspection...makes the customer happy, satisfies us, limits risk...etc...

the problem with larger work is that it's expected that you will start and submit a requisition for payment...if you are under capitalized this can sting badly...

[iwire]

First off I not trying to say how to run your business, I assume your in business so that you can do things your way. 8-)

But as a customer I would not accept those terms, you would be more then free to stand fast and I would simply look for another EC.

I am not asking you to be a bank, I asking you not to bill for services that have yet to be completed.

I don't pre-pay the grocery store because they have to keep supplies on the shelf. I don't pre-pay the phone company because they had to maintain the lines.

Waiting for a final inspection can be fatal if the inspector nails them for something outside of the scope of work or if other factors outside of my control arise and delay the final inspection.

Stuff happens, IMO that is all a part of being in business and why I am still an emplyee....much less headaches.

I know the ECs I work for have almost always had 10% retainer held over them until the projects are complete and complete includes inspections.

[jrannis]

I dont see why the customer would want me to "pre-pay" for the materials.

[dduffee260]

I dont see why the customer would want me to "pre-pay" for the materials.


We do not "pre-pay" for the materials. The supply house extends us credit for 30 days. We install the materials then when we are paid we pay the materials bills. If for some reason a person cannot pay us in 30 days we charge the interest that the supply house charges us. If it goes beyond that point we start talking about collection fees and such. It only costs the person more money in the long run.
I also agree with Iwire, you are doing a project for $2,600 and are requesting $1,800 as a down payment for what? $1,100 for commissioning drawings and calcualtions? Honestly I don't see how a $2,600 project would take drawings, even contractor level drawings but maybe things are different there.
If I were the customer in this case I would ask why should I be a bank and give out free money before anyone turned a screw. There have been countless cases where a homeowner paid someone up front for materials, the contractor left and never came back. If someone wants me to pay up front for the materials I tell them to drop the materials off in the shop and I will write a check for the materials right then.
Then again there are countless times where a contractor does work then does not get paid for it, we have been there also. Just like a hosptial has costs built in for non-paying customers we have to include that also.

[iwire]

I dont see why the customer would want me to "pre-pay" for the materials.

The same way we expect the car dealership to pre-pay for the cars on their lot.

The same way we expect electrical supply house to pre-pay for the material on their shelfs.

Of course it may be furnaced, as customer that is not really any of my concern.

[jrannis]

We do not "pre-pay" for the materials. The supply house extends us credit for 30 days. We install the materials then when we are paid we pay the materials bills. If for some reason a person cannot pay us in 30 days we charge the interest that the supply house charges us. If it goes beyond that point we start talking about collection fees and such. It only costs the person more money in the long run.
I also agree with Iwire, you are doing a project for $2,600 and are requesting $1,800 as a down payment for what? $1,100 for commissioning drawings and calcualtions? Honestly I don't see how a $2,600 project would take drawings, even contractor level drawings but maybe things are different there.
If I were the customer in this case I would ask why should I be a bank and give out free money before anyone turned a screw. There have been countless cases where a homeowner paid someone up front for materials, the contractor left and never came back. If someone wants me to pay up front for the materials I tell them to drop the materials off in the shop and I will write a check for the materials right then.
Then again there are countless times where a contractor does work then does not get paid for it, we have been there also. Just like a hosptial has costs built in for non-paying customers we have to include that also.


I dont know what that was all about but, my credit with the supply house places a debt on me and not the business or the owner.
$800 for drawings. If I put time in for the call and design shouldnt I get paid for it?
Countless times a contractor does work and does not get paid for it? Not me!
Charge an collect interest? Thats too funny. Cant even get paid.
Most professional building departments require drawings and calculations

[480sparky]

If I was the customer I would pass on that one.

That's typical in my area. If you ask for a deposit, you will starve instead.

Customers here are thinking of the finished product.... wire, boxes, devices, and light fixtures that work. They could care less about what it takes me to get to that point.

When you go to a fancy restaurant, do you pay a deposit so they can order your steak, have it delivered, purchase the stove & pan, have the gas lines installed, put in a working Ansul system, buy the table and chair you're sitting in.....?

[iwire]

I would not refuse any deposit, I would have a problem with more then a 1/3 or so.

If the contractor does not know me I think I owe them something to demonstrate I am serous.

[BryanMD]

If the contractor does not know me I think I owe them something to demonstrate I am serous.

and vise versa.

Different regional practices aside, it is just one of several 'terms' by which a contact can be offered. No up front costs to the consumer very often hides a higher total price for the purchase.

On small, minimum material or repair service, where the gear being installed is common or even on the truck (well ok, on MDShunk's truck) then there is no need to charge anything up front.

(If you have a cashflow *need* to get a material deposit you have larger issues)

On bigger commercial projects the Gc will get a prompt progress billing the second the tailgate is closed on the suppliers delivery truck.

The ones in the middle will (and rightly so) vary.

[aline]

When you go to a fancy restaurant, do you pay a deposit so they can order your steak, have it delivered, purchase the stove & pan, have the gas lines installed, put in a working Ansul system, buy the table and chair you're sitting in.....?
They might require a deposit if you were ordering a steak, having it delivered, purchasing a stove & pan, having a gas line installed, having a working Ansul system installed, and buying a table and chair but you're not you're just ordering a steak.

If someone wants to come out to my shop and purchase twenty dollars in materials from me I wouldn't require a deposit either.

You can bet if you eat that steak and then get up and walk out without paying for it the police will be called.

I can't call the police and have my customer arrested because he decided he doesn't have the money after I installed the materials. I have to lein his home or take him to small claims court and hope to eventually get paid.

The customer can pay me the deposit the same day I begin the work if he wants but I want the deposit before I install anything.

Comparing contracting with buying a steak from a restaurant or groceries from a grocery store doesn't make any sense. They're completely different businesses.

[aline]

Usually before I'm even awarded a job I've got several hours into it with going out and looking at the job, estimating the job and then writing up a proposal. Then if I get the job there's time spent ordering the materials.

If nothing else, the deposit is paying for my time I've allready spent on the job. Installing the materials at the job site isn't the only work you do on a job.
Before you even order materials for a job you've got time and money invested in to it.

It's not like the customer is paying you money for nothing. He's paying you for time allready spent on the job. If you feel that the time you've allready spent on the job is only worth $200 then just charge a $200 deposit.

[aline]

You know all those free estimates the customer got. Well now it's time to pay for them. It's called a deposit. :)

[satcom]

We have a lot of custom cabinet and closet shops in the state, they sell and install custom jobs, they all ask for a hefty deposit, before any jobs are started, they can't afford to schedule jobs and then have them canceled because the customer had nothing invvested in the order.

Everyone seems so positive about not paying a deposit on installation services, try in your area to buy installation services, and just see how many ask for a deposit, my bet is there are darn few that will install without the deposit, just because some of the trades have been operating without using deposits as a safegard, does not mean other businesses operate that way.

I think the main reason a lot of the trades don't ask for a deposit, is fear of not getting the work, so they sell the farm, and hope things work out.

I wish we could have three of the larger companies that went belly up in the last 3 years as guests here to tell their stories, what does this industry need to wake up?

Some of the failed companies are from resiatance to the changing times, and construction practices, and some from poor planning and business practices, no one fits all for failed companies.

[jrannis]

They might require a deposit if you were ordering a steak, having it delivered, purchasing a stove & pan, having a gas line installed, having a working Ansul system installed, and buying a table and chair but you're not you're just ordering a steak.

If someone wants to come out to my shop and purchase twenty dollars in materials from me I wouldn't require a deposit either.

You can bet if you eat that steak and then get up and walk out without paying for it the police will be called.

I can't call the police and have my customer arrested because he decided he doesn't have the money after I installed the materials. I have to lein his home or take him to small claims court and hope to eventually get paid.

The customer can pay me the deposit the same day I begin the work if he wants but I want the deposit before I install anything.

Comparing contracting with buying a steak from a restaurant or groceries from a grocery store doesn't make any sense. They're completely different businesses.

Yeah the whole steak thing is way out there. I dont see any comparison

[480sparky]

Yeah the whole steak thing is way out there. I dont see any comparison

The comparison is that the restaurant (gas station, grocery store, etc.) has a huge cash investment long before any customer walks in the door. Yet they do not ask for a deposit.

A new Home Depot opens somewhere in the world every 26 hours. That is a complete store... lock, stock and barrel. Do I need to pay a deposit before I go in the new store?

[emahler]

The comparison is that the restaurant (gas station, grocery store, etc.) has a huge cash investment long before any customer walks in the door. Yet they do not ask for a deposit.

A new Home Depot opens somewhere in the world every 26 hours. That is a complete store... lock, stock and barrel. Do I need to pay a deposit before I go in the new store?

try to special order anything through hd...or any retail store for that matter....they all take deposits....our services are special orders....

if someone hires you for a 4 week job...you don't take a deposit....you book the time for them....the day before you are due to start, they cancel (they have no vested interest i this deal yet...what do you do?

[satcom]

try to special order anything through hd...or any retail store for that matter....they all take deposits....our services are special orders....

if someone hires you for a 4 week job...you don't take a deposit....you book the time for them....the day before you are due to start, they cancel (they have no vested interest i this deal yet...what do you do?

Also in the food business and the retail store, if you run out on the bill, or leave without paying ypu will promptly be arrested, where as if we install a job and have a no pay, it can be years or never collect.

Quote: " A new Home Depot opens somewhere in the world every 26 hours. That is a complete store... lock, stock and barrel. Do I need to pay a deposit before I go in the new store?"

But you pay before, you leave the store, and their mark-up assures them a nice profit, they do not ride to your house, with a stocked truck, you go there, what in the workd are some thinking?

[jrannis]

The comparison is that the restaurant (gas station, grocery store, etc.) has a huge cash investment long before any customer walks in the door. Yet they do not ask for a deposit.

A new Home Depot opens somewhere in the world every 26 hours. That is a complete store... lock, stock and barrel. Do I need to pay a deposit before I go in the new store?

Yeah. Its not a very good one.
Contractors have buildings and overhead too Thats about it

[aline]

If you don't want to call it a deposit call it a progress payment. I've already gone out and looked at the job, estimated the job, wrote and submitted a proposal for the job, spent time generating a material list and ordered the materials. This is all part of doing the job. Shouldn't I be entitled to some kind of payment by now?

So far the customer has probably gotten ten free estimates and consumed a lot of contractors time and money and hasn't had to pay a dime yet. Why shouldn't he fork out some dough for what he's already recieved?

I wan't to get paid some money for what I've already got invested into the job before I spend more time and money to not get paid.

I'm a little bitter about this subject right now because I recently got stiffed by two customers who didn't want to pay the deposit and against my better judgment I did the job without getting it.

Now I'm spending more time and money trying to collect.

[wireman71]

I've worked for a EC that doesn't require deposits. At least for smaller stuff. You don't pay they slap a lein on your property and keep going.

[iwire]

Yeah. Its not a very good one.
Contractors have buildings and overhead too Thats about it

I see very little difference other then restaurants sell food and labor and ECs sell electrical stock and labor.


Personally as a customer I would have no problem with a deposit of up to a 1/3 on jobs under say $1.00-$8000.00.

If a contractor starts asking for more then 1/3 before they have actually worked with tools on the job that would send up a red flag for me.

To me that is a signal that this is not an established business on firm ground and is being run like a 'side job' I would move to another contractor.

[celtic]

A new Home Depot opens somewhere in the world every 26 hours. That is a complete store... lock, stock and barrel. Do I need to pay a deposit before I go in the new store?

If you have ever bougt something from HD, you have put a deposit into the new store :wink:

[Dennis Alwon]

do you all collect a deposit when you work for a builder or GC. My gc's would laugh at the thought.

[satcom]

do you all collect a deposit when you work for a builder or GC. My gc's would laugh at the thought.

You better bet your GC's and builders are getting a down payment.

[jrannis]

I see very little difference other then restaurants sell food and labor and ECs sell electrical stock and labor.


Personally as a customer I would have no problem with a deposit of up to a 1/3 on jobs under say $1.00-$8000.00.

If a contractor starts asking for more then 1/3 before they have actually worked with tools on the job that would send up a red flag for me.

To me that is a signal that this is not an established business on firm ground and is being run like a 'side job' I would move to another contractor.

I perfer having a nice six figure income, time off when I decide, and not chase deadbeats.
Lot better than working at a restaurant!!

[ike5547]

In California it is illegal for a contractor to take more than a 10% or $1000.00 deposit (whichever is less) for a home improvement. I've never asked for a deposit myself.

[iwire]

I perfer having a nice six figure income, time off when I decide, and not chase deadbeats.
Lot better than working at a restaurant!!

If your making six figures I assume you are at least a part owner, if not your working more hours then I would care to. 8-)

Not exactly the same as 'working at a restaurant'

The owner of a Boston sandwich shop I go to was talking about importing a specific Mercedes model not available here in the US.....I think he is doing OK.:grin:

[peter d]

The owner of a Boston sandwich shop I go to was talking about importing a specific Mercedes model not available here in the US.....I think he is doing OK.:grin:

They must be some gourmet sandwiches!

[iwire]

They must be some gourmet sandwiches!

No, just good pizza, subs and Gyros, but the shop is busy from lunch to well after midnight. :smile:

[peter d]

No, just good pizza, subs and Gyros, but the shop is busy from lunch to well after midnight. :smile:

Ahhh...sounds like the classic Greek-owned New England pizza place. :cool:

I'm sure most of us know it takes many long hours and 100% dedication to be that successful in the restaurant biz.

[cowboyjwc]

In California it is illegal for a contractor to take more than a 10% or $1000.00 deposit (whichever is less) for a home improvement. I've never asked for a deposit myself.

Just got out my CA Lcense Law book to look that up. I couldn't remember what it was.

If it weren't for bad contractors Mike Holmes wouldn't have a show on TV.

If I remember correctly my old boss got 80% at rough and 20% at final.

[Ed Carr]

I personally play it by ear. I got a call recently to do a new service entrance at a camp at a nearby lake. The owners of the poroperty lived out of state. I requested what I thought would cover the materials and offered any references they may want. When the job was done and inspected I sent the final bill and was paid promptly.The owners had no problem with the arrangement and as someone else here has said if they had found a problem with it I would certainly have seen that as a red flag.There are two unknowns here you the EC and the customer. Each scenario is different and I think that we get a feel for it as we go. Thanks, Ed

[ike5547]

If I remember correctly my old boss got 80% at rough and 20% at final.
I charge 60% then 40%. 80% and 20% sounds like a more realistic break down, though. After the rough you've probably completed and installed at least 80% of the actual labor and materials in most cases.

[jrannis]

If your making six figures I assume you are at least a part owner, if not your working more hours then I would care to. 8-)

Not exactly the same as 'working at a restaurant'

The owner of a Boston sandwich shop I go to was talking about importing a specific Mercedes model not available here in the US.....I think he is doing OK.:grin:
Ill bet you pay before you get that sandwich or within the hour of showing up

[jrannis]

In California it is illegal for a contractor to take more than a 10% or $1000.00 deposit (whichever is less) for a home improvement. I've never asked for a deposit myself.
Thats an easy one. Dont do home improvements in California!

[jrannis]

If your making six figures I assume you are at least a part owner, if not your working more hours then I would care to. 8-)

Not exactly the same as 'working at a restaurant'

The owner of a Boston sandwich shop I go to was talking about importing a specific Mercedes model not available here in the US.....I think he is doing OK.:grin:

How could I work less than you? You are playing on the internet all day long!:grin:

[Bulldog1401]

Total contract less than $10,000--50% down, 25% after rough inspection, 25% after final inspection.

Total contract greater than $10,000--25% down, 25% after service inspection, 25% after rough inspection, 25% after final inspection...

I usually stick my neck out on service calls or small jobs( less than $500.00) but only if I know the person.

Everything is in writing..up front.. no work starts before the deposit is recieved.. if it is payed with a check that means cleared and money in my hand/account...

[satnad]

In some situations I tell my customers that their credit is treated the same as some C. Cards treats me. Credit limit = $300.00 or $500.00 or $800.00 etc.
I will start the job, but at the end of the first day (sometimes the 2nd) I need a payment for permit, run around for materials and time used already to install materials etc. From then on it is called progress payments - the bigger the job the more progress payments. When a contract is signed (1 or 2 weeks before) 10% is collected - non refundable if they default! They could get you in the end BUT REMEMBER you already added such profit which might be equivalent to that last payment you may not get!

[satnad]

Not everybody lives in a nice place like Chapel Hill.

I would tell them that its against company policy.

Have you ever arrived and they say, when answered the door bell -'sorry but we decided to go with someone else '- years ago, I was left out with my jaw opened wide and a panel on my shoulder and NO WORK for 3 days!
You, I, any one, needs the 10% or 20% non refundable deposit days in advance. (I am not talking about a progress payment -that can waite a day or two)

[satnad]

Total contract less than $10,000--50% down, 25% after rough inspection, 25% after final inspection.

Total contract greater than $10,000--25% down, 25% after service inspection, 25% after rough inspection, 25% after final inspection...

I usually stick my neck out on service calls or small jobs( less than $500.00) but only if I know the person.

Everything is in writing..up front.. no work starts before the deposit is recieved.. if it is payed with a check that means cleared and money in my hand/account...


What are you going to do while waiting for 4 days for the check to clear?
For home owners or unknown GC I would make the $10,000.00 be paid in $800.00 progress payments installments. (Credit limit = $800.00 = profit amount = happy (no last payment = no profit = not as happy but not tottally depressing)

[satnad]

That is one sure way to get in trouble, if you sitting at home with no work, you would be better off, out looking for profitable work, then changing your terms, or cutting your profit, however, this is exactly what some do, when things slow down, they react, thinking oh well at least i will have something, will you really gain by doing that, check your figures, and you will find, you usually loose money in the long term, by accepting work in a panic mode.

It happened to me a few times. Then all kinds of good calls came in soon after but I was too busy doing the the ones I under bid, no time to attend to seemingly good jobs! If I wait and ignore the shotty cheap jobs (customers) then I make more money and work much less.

[Bulldog1401]

What are you going to do while waiting for 4 days for the check to clear?
For home owners or unknown GC I would make the $10,000.00 be paid in $800.00 progress payments installments. (Credit limit = $800.00 = profit amount = happy (no last payment = no profit = not as happy but not tottally depressing)

I get my deposit a week in advance of job start date. On the way home from my current job that has 3 or four days left....If they dont have the deposit, I sell their time to someone else, and they go back in the rotation...very few twiddle thumb days, I assure you.

[AV ELECTRIC]

In California, Contractors Law Requires A Maximum Amount Of 10 Percent Of The Total Job For A Deposit You Can Ask For More But The Customer Is Not Required To Pay More .

[satcom]

In California, Contractors Law Requires A Maximum Amount Of 10 Percent Of The Total Job For A Deposit You Can Ask For More But The Customer Is Not Required To Pay More .

So you get the 10% deposit, then they pay a day rate every day you are on the job, starting with the end of the first day and every day you are there.

Nothing illegal with that.