Payment scheduel

Status
Not open for further replies.

amge

Member
I am bidding on a job that has $ 17,000.00 of light fixtures and another $ 10,000.00 for materials. What should the down payment be and howmany payments should I collect.

Thanks
 

480sparky

Senior Member
Location
Iowegia
You can ask for whatever you want.

Whether asking for a certain amount down may be illegal in your state.

As for payments, it's up to you and what your customer will agree to.
 

petersonra

Senior Member
Location
Northern illinois
Occupation
engineer
I am bidding on a job that has $ 17,000.00 of light fixtures and another $ 10,000.00 for materials. What should the down payment be and howmany payments should I collect.

Thanks

You can ask for just about anything in some states.

Some states limit down payments as another poster mentioned.

in reality, the payment schedule is something you will have to work out with your customer. Many companies have standard terms and conditions that will come attached to the P.O. they send you. You probably won't like their standard T and C's. But if you accept the P.O. as written, you are stuck with them.

In any case, expect that payment will not get to you anywhere near as quickly as your contract states. The contractual payment dates are considered suggestions that can be safely ignored by many companies.

To me a fair DP is 10% of the value of the contract, and no work starts until the 10% shows up, especially for new customers. After that I would ask for progress payments based on actual documented progress of the project. That is fair to both sides. Perhaps a 10% hold back at the end until final signoff.

However, in the current economic climate, you may have to accept whatever the buyer wants if you want to get the business.
 
Last edited:

nyerinfl

Senior Member
Location
Broward Co.
I am bidding on a job that has $ 17,000.00 of light fixtures and another $ 10,000.00 for materials. What should the down payment be and howmany payments should I collect.

Thanks

Make sure you have the finances to support this, you will likely be in the red most of the job. Labor costs add up quick, checks take time to collect, and material bills become due. If I got the job I would invoice immediately for the fixtures, especially with possible lead times you need to get them ordered, then keep the pressue on the GC for the first payment. Also make sure you get something signed from the GC on this project. Good luck on the down payment, especially if it's with a GC.
 

hardworkingstiff

Senior Member
Location
Wilmington, NC
Talk with your supply house and see if their credit department can help you with this. They will often set up a job account and do a credit check for you. They don't want to get strung out either.
 

CopperTone

Senior Member
Location
MetroWest, MA
here is a pretty fair schedule you could present to them with your contract

example - say the total contract is for $100,000 including lighting package - (say lighting package is $20,000)

100% cost of lighting package to be invoiced immediately when it is delivered to the site (specify how much that will be before) or $20,000

10% deposit - consumate the contract $10,000
40% or $40,000 after rough
25% or $25,000 after finish
5% or $5,000 after inspections and punch list

you can work out something similar .

I with GC's I work with regularly, I bill 67% after rough, 33% after finish.

Everything is negotiable.
 

fridaymean

Member
Location
Illinois
If this is a commercial project good luck with a down payment. Bill for the fixutres when the arrive. Also, bill for mobilization (this is kinda like a down payment, but you still have to wait one biling cycle for it), and be heavy on the front end work. Alot of commerical work they use a work breakdown or an AIA form for billing. You are pretty much limited to billing for work-in-place....
 

satcom

Senior Member
What is the schedule for the job? Will it take 2 weeks or 2 months? Is the contract with a GC or the property owner? These things make a difference.

Yes it does make a difference, with property owners we have sign a construction loan, and then we bill for progress payments as agreed, if it is a GC we check their credit reports and if they pass the credit test, have them sign our contract with a payment schedule we both agree with the terms.
 

dmagyar

Senior Member
Location
Rocklin, Ca.
Get paid for the fixtures when they arrive

Get paid for the fixtures when they arrive

With $17k of lights, I'd suggest you make it known that they will be billed once they arrive on-site.

As others have stated get the dp, then show the $17 grand as payable when the fixtures hit the job. You're still going to have 30 days to wait from when you bill for them.

Divide any money left to the rough, install, and finish.
 

dduffee260

Senior Member
Location
Texas
If it is like our commercial projects you can request payment on work performed or materials stored on site. We have a Schedule of Values which ties to an Application For Payment. If this is a private job they may be able to make a down payment but any govt project they pay on the schedule. You can front load your schedule to get ahead on this. Good luck with your project. PM me if you need anything.
 

Fulthrotl

~Autocorrect is My Worst Enema.~
I am bidding on a job that has $ 17,000.00 of light fixtures and another $ 10,000.00 for materials. What should the down payment be and howmany payments should I collect.

Thanks

you don't say where you are located, and what you can legally ask for
varies.

in calif. it's 10%

i bid a little remodel earlier this year. total with extras came to $29k.
general assured me that he paid as soon as he was paid.

sure, wilburr.... the guy was a pathological liar.

materials were about 8k, two weeks work, spread over a month.
job took 7 weeks, 'cause the general had no money for material.
it was 5 weeks after the job was done, before i saw any money
whatsoever.

last week, i got the retention. 5 months after the permit was
signed off, and as builts, letter of warranty, and final paperwork
was submitted.

when was the general paid? he was paid in full for his progress payments,
within 4 days of submitting them. i checked.

and i got paid first, as i had some leverage that the other subs didn't
have. some of them still aren't paid anything... 7 months in.

trust me, you will not have the leverage i had in this situation.
you will be one of the other subs.....

if i'm not doing work directly for the customer, on today's market,
doing work for a small general contractor, there is no way in hell
i'd do work without getting the material up front.

every general i know of is struggling to stay afloat, and you will become
their de facto silent partner, like it or not.

make sure that you comply with letters of intent to lien, and other
requirements appropriate to the state you operate in, to be able
to secure your position.

if you have a wholesale house you are on good terms with, have the
material delivered to the jobsite by the wholesale house, then the
wholesale house has a direct recourse to the owner of the property
to lein or file stop notices, instead of just coming after you.

good luck.
 
Who is supplying the lighting fixtures? If you are supplying them, and if they are special order you need to make sure you are cover that cost on the down payment. Your supplier will more than likely ask for pmnt up front if that's the case. Also, if this is a new client, you do not want to leave too much money for final pmnt. It sounds like a project that can be completed with 3-4 progress payments.
 
Status
Not open for further replies.
Top