curt swartz
Electrical Contractor - San Jose, CA
- Location
- San Jose, CA
- Occupation
- Electrical Contractor
I would never give a homeowner a large sum of money for doing nothing.
And, doing nothing? There is easily an hours work in a simple estimate.
I drove to your job site, talked with you about your needs and provided informed professional suggestions. Then, from my office, I wrote up a proposal, had someone put it in the system and emailed you a copy. I might have even spent some time on the phone or on site with a POCO rep. Then, if you hired me, I purchased your materials and scheduled the crew. That is not doing nothing.
You want me to do some work? Give me a deposit and I will get the materials and put you on the schedule.
I'm never behind on bills and I generally collect a deposit.
I collect a sizable deposit simply to help protect my interests. If I did a service change and the customer didn't pay me, I'd be out $2-3K. It would cost me at least hundreds more to TRY and collect it. If a bankruptcy were involved, I'd see nothing. With a 50% deposit, I will at least get something.
The 10% deposit wouldn't come close to covering materials on anything but a service call type job.
Hell, sometimes it wouldn't even cover the permit fees.
What if the homeowner gets 3 bids on a project and doesn't give you the job? You still require them to pay you 50% of the project for your time for prepare the estimate? Estimating time is a cost to you but it is part of your overhead. I sure hope that it doesn't cost you $5,000 to bid a $10,000 project
Other than the time you spent on the estimate you are not out anything. I don't see why anyone would want to hand 50% of a project over to someone that may take their money and disappear. It is much easier for a contractor to take action against the property they it is for a homeowner to take action against some contractor that probably has nothing.
If there is special order material involved then that is a different matter and I understand they need to cover that expense. If the job falls through you are stuck with it. As far as other material for the job you can ask for progress payments a you bring the material and perform the work. My suppliers give me 30+ days to pay for anything i buy so I'm not acting as a bank since I'm not using my cash.