justin13me
Member
- Location
- CANADA
I know there are many companies that are doing things right but hypothetically:
EC vs. GC
electrical contractor versus general contractor
Please feel free to share your story if any of this sounds familiar. My electrical contracting business is currently suing a client who is a general contractor for outstanding payments despite completion of projects. 10% holdbacks are past the lien expiry period as well progress payments have not been received in full. The damages AND outstanding amounts are in the hundreds of thousands.
As I would also like to see how the trial unfolds in the court of public opinion, I've reached out to media outlets to expose how some general contractors are witholding payments to their subcontractors mostly because they're operating with revenues rather than by turning profits or having healthy margins on their jobs. The only leverage I can sometimes use on them is when I threaten the progress of the job or cite delayed material because of non payments. However once projects are complete or 90% complete I am still typically owed about 45% of the contract value. And then I am expected to complete all 'deficiencies' and 'closeout documents'. (Kind of hard to do when your efforts are never quite rewarded in the timely manner as would be expected).
Especially considering that many GCs get a deposit upon receipt of a purchase order which does not ever go through to the other trades under the prime contract. Despite my companies payment and invoice terms and conditions, I still receive first payment on a job after 50 to 60 days even if the project is only expected to take for example 2 months. Regardless of size I finance and /or pay, for all the labour and material up to and including, and then past this point.
As far as I'm concerned, many of these (general contracting) companies seem to be running a form of ponzi scheme: take new money to pay for old debt, receive payments as fast as possible and pay out as slowly as possible.
What I hope to gain other than my overdue, fair compensation, is some legislative change that would stipulate: that all trades, contractors and even consultants involved (architect, engineer etc) get paid on the same date for progress payments. And within 2 weeks of project completion date be paid to 90%.
If this were to happen projects would close out sooner and it could weed out the contractors who can not sustain their current system and/or at least force them to operate at a level that is more manageable and efficient and profitable. This could wreak havoc to some companies at first but in the long run better pricing and budgeting would also result which would have deeper benefits to the whole industry and maybe more.
EC vs. GC
electrical contractor versus general contractor
Please feel free to share your story if any of this sounds familiar. My electrical contracting business is currently suing a client who is a general contractor for outstanding payments despite completion of projects. 10% holdbacks are past the lien expiry period as well progress payments have not been received in full. The damages AND outstanding amounts are in the hundreds of thousands.
As I would also like to see how the trial unfolds in the court of public opinion, I've reached out to media outlets to expose how some general contractors are witholding payments to their subcontractors mostly because they're operating with revenues rather than by turning profits or having healthy margins on their jobs. The only leverage I can sometimes use on them is when I threaten the progress of the job or cite delayed material because of non payments. However once projects are complete or 90% complete I am still typically owed about 45% of the contract value. And then I am expected to complete all 'deficiencies' and 'closeout documents'. (Kind of hard to do when your efforts are never quite rewarded in the timely manner as would be expected).
Especially considering that many GCs get a deposit upon receipt of a purchase order which does not ever go through to the other trades under the prime contract. Despite my companies payment and invoice terms and conditions, I still receive first payment on a job after 50 to 60 days even if the project is only expected to take for example 2 months. Regardless of size I finance and /or pay, for all the labour and material up to and including, and then past this point.
As far as I'm concerned, many of these (general contracting) companies seem to be running a form of ponzi scheme: take new money to pay for old debt, receive payments as fast as possible and pay out as slowly as possible.
What I hope to gain other than my overdue, fair compensation, is some legislative change that would stipulate: that all trades, contractors and even consultants involved (architect, engineer etc) get paid on the same date for progress payments. And within 2 weeks of project completion date be paid to 90%.
If this were to happen projects would close out sooner and it could weed out the contractors who can not sustain their current system and/or at least force them to operate at a level that is more manageable and efficient and profitable. This could wreak havoc to some companies at first but in the long run better pricing and budgeting would also result which would have deeper benefits to the whole industry and maybe more.
