mivey
Senior Member
Nothing personal, they just don't everybody. After getting burned by drive-offs, who can blame them? If they really knew you, they would let you get gas before paying.
deposit on commercial jobs
- Thread starter Mike Lang
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mivey
Senior Member
And it can be illegal to do that. A check is not supposed to be used as a toy, but in lieu of cash.
mivey
Senior Member
I know contractors who require a deposit to start, scheduled payments at designated stages, and a final payment after the job is completed. If you have the money to pay for the job, so what?
Just as it is reasonable for a contractor to ask for some money up front, it is reasonable for a customer to not pay for everything up front either.
A long term relationship can make you relax the rules sometimes, but what if your long time friend dies and you are now at the mercy of his crazy son who is the executor of the estate?
Just as it is reasonable for a contractor to ask for some money up front, it is reasonable for a customer to not pay for everything up front either.
A long term relationship can make you relax the rules sometimes, but what if your long time friend dies and you are now at the mercy of his crazy son who is the executor of the estate?
N844AA
Member
- Location
- Los Angeles
hardworkingstiff
Senior Member
- Location
- Wilmington, NC
I've had some success (when working for the owner, not a GC) with 50% before I start and 50% when I finish. Jobs are usually not much more than a week.
cadpoint
Senior Member
- Location
- Durham, NC
I think you nailed it! commerical, generally No (OK, depending on the contract) and private, Ah Yes!
It comes down to terms of agreement! What one does one do for "their" practice of being a business!
roy g
roy g
we don't generally ask for front money unless for special order equipment, & bill monthly for work installed and material stored. most of customers we work for shy away from paying in advance. I had a call recently to give estimate to complete job where they had paid EC contractor $14 K for fixtures and he told them he purchased but some one had stolen them. they checked with supply house and they wer never ordered. over budget and out of money.
roy g
we don't generally ask for front money unless for special order equipment, & bill monthly for work installed and material stored. most of customers we work for shy away from paying in advance. I had a call recently to give estimate to complete job where they had paid EC contractor $14 K for fixtures and he told them he purchased but some one had stolen them. they checked with supply house and they wer never ordered. over budget and out of money.
You must be in a state that does not require licenses or bonding from contractors. I can assure you a business that depends on it's earnings to support a payroll and benifits, will either secure a decent deposit, or have a contract with some form of approved credit, with a history of on time payments.
hardworkingstiff
Senior Member
- Location
- Wilmington, NC
This is the thing I think is overlooked by most contractors. CREDIT CHECK. It is more important now than ever.
If the customer is willing to put out a deposit, then IMO, they will probably have no problem paying the final invoice after work is complete.
If you have difficulty getting money from the start, when the customer needs something from you, how hard will it be to collect when you are finished and they don't need you?
We are showing good faith and extending credit by finishing the job prior to final payment, there is nothing wrong in the customer showing good faith by paying a deposit.
It's not a hard and fast rule for me, but it's something I always ask for (deposit) and usually don't have a problem getting one.
If you are bashful, then you should get out of business and get a job.
PetrosA
Senior Member
- Location
- Lancaster, Pennsylvania
I can actually imagine how Shockin can think a no-deposit world is normal. Around here it exists among the Amish, but the operative word there is "among." Between Amish and English, you can bet that a deposit will be required.
A customary breakdown in this area for resi and light commercial work would be 1/3 down, 1/3 after rough and final 1/3 upon completion. I recently bid a small commercial job for a new customer that totaled $4500. $3500 of that was materials and I made it clear that they were special order and would have to be paid for up front. If they decide not to hire me, that's fine. I won't take that kind of financial risk on myself. I have mouths to feed.
A customary breakdown in this area for resi and light commercial work would be 1/3 down, 1/3 after rough and final 1/3 upon completion. I recently bid a small commercial job for a new customer that totaled $4500. $3500 of that was materials and I made it clear that they were special order and would have to be paid for up front. If they decide not to hire me, that's fine. I won't take that kind of financial risk on myself. I have mouths to feed.
Yes, deposits, credit checks and progress payments are the norm.
Many times you will notice, someone claiming they work with standard contracts presented by the GC, the guys that accept these, are usually new entries, or just don't know better, or they would protect themself with their own contract and terms.
I'm not saying world-wide its a good idea. But some parts of the country deposits are not the norm. On comm around here it would never happen.
The contract terms are not set by the GC or the EC. They are set by the owner / architect. They are included in the specifications and bidding documents. If you want to do the job you will accept the terms of the AIA contract. If not you won't be doing the job. (Talking about medium size comm and ind. 250K - 1.5M)
- Location
- Massachusetts
We do jobs from $500 to $20 million and I do not think we ever ask for deposits.
ty
Senior Member
- Location
- 3rd Rock from the Sun
Those jobs are probably bonded and paid on AIA forms.
The compaines your working for, may of passed the credit test, or have a good payment history
AIA documents do not usually ride alone, they may contain third party clauses and terms that differ from the so called fair agreements, everyones attorney will usually review and revise these documents as needed, including terms and payment clauses.
- Location
- Massachusetts
The big ones no doubt, the smaller ones, no not necessarily.
I just landed about 380K of work for the company it was all done by phone and email. Of course that is a regular customer. No deposits, no contract.
My only point is there are million ways to operate, not just the ways some people insist on here.
Well then according to the "expert" that has been commenting on this thread your company is not a legitament business and your owners are not businessman.
I disagree with this "expert"
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