# materials cost up front



## Mike Finley (Apr 28, 2004)

FCI you have to do what works for you. Know all the elments of the game and figure out if some matter more or less to how you are doing things.

- Consumer advocates always list big down payments as big red flags on the radio, tv and articles they write about what to look out for

- Some companies play off this to give them an edge in their market and don't require any money till completion

- Deposits make jobs real 

- Big Deposits help with cash flow

- Big Depostis can be very helpful to a small operator 

I'm sure I missed something but you get the idea. Now you have to decide what works best for you.


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## fci (Dec 11, 2006)

*True*

I think if you are specializing, painters, drywall, roofing, framing, etc it might be easier to create a payment structure, but I do about the same thing as you do and as a remodeler, every job can be so different. Do you agree??


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## john elliott (Oct 23, 2005)

Mike Finley said:


> I spend quite a bit of time with customers before they become customers. I can smell a jack off from 3 miles away and I know what is going to come out of any customers mouth 2 minutes before he does. As long as I can stand in front of a person and watch them while I talk to them and listen to their answers, see how they conduct themselves, see how they interact... I'm not worried at all. I've met every type of fool or con man there is and know all their games.



How are you at predicting the future generally? Your remarkable ability to read minds and interpret body language will, of course, only tell you what their _intentions_ are. It won't help you if the future holds some event that prevents them from carrying out their intention to pay you, such as their being killed in a road accident, or their bank failing- unless, of course, you can actually predict the future?.....

John


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## Mike Finley (Apr 28, 2004)

john elliott said:


> How are you at predicting the future generally? Your remarkable ability to read minds and interpret body language will, of course, only tell you what their _intentions_ are. It won't help you if the future holds some event that prevents them from carrying out their intention to pay you, such as their being killed in a road accident, or their bank failing- unless, of course, you can actually predict the future?.....
> 
> John


LOL, their bank failing? LOL! UK and USA must be very different places, nobody has had to worry about that since 1929 here.

It's a one two punch like I said before. If you've been around long enough you see every customer type over and over and over again, you see every type of person over and over and over again...

... the other protection is my contract, plus I won't be broken financially by a customer. No customer is going to get deeper in our pockets beyond the first payment due on the payment schedule, no 1st payment no workee, no payments along the way no workee... our final payments are always no bigger than 10 percent...

My exposure is minimal in the big picture.

For the big stuff - that is why we have liability insurance, workers comp insurance as for payments from customers, nothing to be worried about.


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## Mike Finley (Apr 28, 2004)

fci said:


> I think if you are specializing, painters, drywall, roofing, framing, etc it might be easier to create a payment structure, but I do about the same thing as you do and as a remodeler, every job can be so different. Do you agree??


If you are talking to me, in regard that we do the same type of work then I would say for certain that creating a payment schedule is very simple. We do basically the same things over and over and over again, but even if we didn't you can always create a custom payment schedule for any type of work, worst case it could be based on time instead of events.


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## Tom M (Jan 3, 2007)

Like I said earlier and many of these feeds agree, every company operates different. Of course you can smell a jake -off right away--so maybe your request is he pay material COD and then give you a deposit toward the labor, maybe another customer is a close family friend or family member of an excellent previous customer, so you dont ride the need for extensive paper work. The business is full off high school drop out--drunks or druggies and people are cautious about who is working on their homes. Usually not the owners of the construction company but we all have had these types of employees at some point and the customer may have gotten screwed from a contractor in the past-- you know one of those "I gave this guy$5,000. and he never came back after the first day." Ideally you are a company staffed with a bookeeper and secretary and the paper work is professional and current always--- but lets face it most often it is not the case and the paper work is being done on short notice after a days work and things get missed. A deposit is every business's right, its an act of good faith for the customer until work is under way THEY HAVE NOTHING FOR THERE MONEY and know little about the process. Ask to much and people get nervous. By the time the check clears you are already in it and on the hook for material accounts-DO WHAT WORKS FOR YOU


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## fci (Dec 11, 2006)

*M.Finley*

So do you do just bathrooms? Is there enough business in bathrooms where you are or do you take other related jobs? Do you have to travel?


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## 747 (Jan 21, 2005)

I like the 25/25/25/25 the guy on the first page posted. I wouldn't have a problem with that as a homeowner.


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## FleshnerDrywall (Dec 9, 2006)

I go in thirds- 1/3 upfront 1/3 when rock is hung and the final 1/3 when finish work is done and site cleaned up.


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## nadonailer (Nov 15, 2005)

Well, I get $1000 down (all that's allowed in CA), but as soon as I start work, 20%, and another 20% as soon as demo and framing are complete. I've been ripped off enough to make sure i get my $$ upfront! By the time the job is done, I'm only owed 10% (usually about $10k) so my potential losses are limited. It's just foolish to leave too much money laying on the table IMO...


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## Mike Finley (Apr 28, 2004)

fci said:


> So do you do just bathrooms? Is there enough business in bathrooms where you are or do you take other related jobs? Do you have to travel?


Yes,yes,no,no.


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## 6stringmason (May 20, 2005)

For jobs over $2000 I get %50 down and the rest including any change orders when done. That is for the masonry end.

For concrete countertops, I get %50 down no matter what the cost. If its a $600 vanity top, I still get $300 before starting. Reason is that everyone is custom made, and once I start the mold making process and mixing the ingredients, there's no turning back. If someone calls after I poured the top and says, "Forget it. I dont want it anymore." MY response is "ok.. thanks for the $300."

Then I either would have to throw it in the dumpster, or put more time and effort into the piece polishing and sealing it to use as a sample for something. And I have enough samples laying around.


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## Fence & Deck (Jan 23, 2006)

Kamps, it also depends on your contract. If there is nothing in there about cancelation, you don't have to give the money back.

Here in Toronto, the consumer protection laws have changed dramatically.
For example: you take a deposit on a fence. The purchaser has 10 days to cancel it, in writing, at which point they are entitled to their deposit back.
You START the job (I build decks and fences) 3 days after you sign the deposit. The posts are in and the wood is on site. you get back to your office, and there is a letter from the homeowner canceling the job.
You are f-cked. You cannot legally go get the posts and pull them as they are now considered part of the real property; although you can remove the wood if it has not been installed.
According to the law I would have to give the deposit back and walk away!
Actually, this is rather obscure, and has not yet been tested in court, but it's there in the Act.


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