Do you require a deposit?

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Don't know about WA but in CA you may ask for 10% or $1000 whichever is LESS. Personally I never ask for a downpayment or deposit and my customers appreciate the trust & usually pay very quickly when they get the invoice.
 
I try and get 100% upfront...I have had 0% results on that ;)

I shoot for 30% - 50%....30% from people I know; 50% from those I don't...either way, I'm not a bank and I am not financing YOUR project or adding value to YOUR home/business at my own expense.
 
My standard is

My standard is

..usually 50% down, 25% on power-up of the equipment and the balance when all the alignments and demo screening has been run. Never had any problems with that. This is for installations/major upgrades. (For those who don't know, I do screening rooms and film/video projection and sound systems.)

For projection services (actually running a film/video screening) it's always 100% at the time of show. The sole exception is for the University I contract with, they issue a quarterly purchase order that I bill from.
 
No steppin' on toes

No steppin' on toes

I've been known to tell a customer who was slow or reluctant to "settle up", that we have an agreement with our local F&M Bank. They don't do electrical wiring; we don't lend money. Usually gets a laugh (and a check). I also make the point, on the front end, that we don't ask for "down payments, money for materials/excavators, permits, etc., all we ask for is two things; your signature on the contract before we start and your signature on a check when we're done." I've only had to file liens twice in the past 10 yrs, didn't have to go to court on either one and got paid on both. Check the WA lien laws. Hint: You might go to L&I in Olympia and ask for a little guidance. Good Luck;)
 
Depends: If there is a lot of up front expenses YES, many times the short duration of our jobs does not allow for this. I mean 30 day paymnets are unheard of anymore, 45-60 seem the norm. But as more customers move to credit cards the small percentage charge by the credit card company is mnor in relation to the prompt payment.
 
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1/3 when you sign a contract ...this buys material
1/3 when you get a rough inspection.....this pays my helps time and some of my time.
1/3 upon substantial completion. I use substantial completion in a contract so if the carpenter or painter is holding up the job (by a good amount of time) and all I have left is say....undercounter lights or puting on plates, something small....I can ask for a final payment....and most of the time I get a good % of the final payment and then I get an inspection and the rest of my payment.
usaully that last 1/3 is all my profit.
 
brian john said:
Celtic:

I have one customer with a yearly contract 4 visits a year, they pay 100% at contract renewal.
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Is that service work or new construction?
 
Sonny Boy said:
Say a percentage of the total cost of the job.

How much do you ask for?
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From the consumer side, I expect that a deposit would be required for any substantial work that I contracted for, just to prove I am serious about it, if nothing else. Maybe 25%.

For relatively small amounts (say < $1000), I would not expect to pay a deposit.
 
petersonra said:
For relatively small amounts (say < $1000), I would not expect to pay a deposit.
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Don't expect to be in business long, if you do any job without a deposit! and if it is a day job, more then $300 and a new customer, I recommend you get their drivers lic, infor, and a verified credit card voucher signed, before you start the job, we still have to lock our doors in this area of the country.

For most small business, $300 is a lot of money, a thousand loss can be a train wreck, most small contractors 70% of the charges are for pay outs, money they pay others to operate the business, a $300 bill to the customer may give the contractor $90 if he is lucky, residential customers usually think in terms of their hourly rate, they usually do not understand the cost of doing business, on the other side of the issue, commercial customers that are operating a business, do understand your position.
 
satcom said:
Don't expect to be in business long, if you do any job without a deposit! .......
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I've been in business for, oh, 13 years or so and I don't take deposits in general. How soon can I expect to go out of business? :)

I only do residential, don't work for GCs, and all of my customers come by referral, so I've already minimized my risk considerably. My general terms are "payment due upon satisfactory completion of work". And I don't mean "upon final inspection", I mean "when the customer's satisfied."

In specific cases I'll take a deposit for expensive special-order equipment, but for me that's pretty rare. When it does happen, it's a deposit in the true sense of the word: I'll get a check, but I don't cash it. It's just a security to cover my outlay in case they change their mind about non-returnable stuff or suddenly get a divorce or some such.

I know that business model won't work for many of you, but I have a very small business built on reputation and trust. It works for me. And I'm saved the hassle of having to manage escrow accounts... :)
 
I get 50% up front when proposal is signed (this is to cover material), 25% after rough-in inspection and the balance (including extras) when complete. I figure if I get burned - and I haven't yet - that I'd at least have the material covered as I don't start the job until I drop the material and get my first check.
 
My deposit is usually just what it takes to cover the material and I won't ask for if it is not $300 or more. That's about as much hard-cash exposure as I'm comfortable with.

Mark
 
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