How Much Money Do You Get Up-front?

 
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Old 02-06-2006, 06:09 PM   #1
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How Much Money Do You Get Up-front?


I had a bid out for a small job, a couple weeks work for $3200 (labor) + materials. My contract stated 50% up front ($1600), 25% due at half way point and balance at end of job. Customer came back with request for 25% down, 25% at half way and balance at end of job. These people said they have had trouble with contractors and were working at getting money back from a roofing contractor. I sensed future problems so I refused to adjust my payment schedule and they decided not to hire me. Much as I could use the work I felt good when they turned me down.

I called around to see what local contractors are getting for a down payment and it varied quite a bit. What do you ask for a down payment (if anything) on these sub $5,000 jobs?

Chuck
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Old 02-06-2006, 06:11 PM   #2
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Re: How Much Money Do You Get Up-front?


On smaller jobs, we don't ask for anything until the job is done. On jobs that over $100,000, we usually ask for 10%. Then the balance when job is completed.

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Old 02-06-2006, 06:18 PM   #3
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Re: How Much Money Do You Get Up-front?


I ask for half up front on small jobs.
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Old 02-06-2006, 06:26 PM   #4
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Re: How Much Money Do You Get Up-front?


I'm with Rino, pay upon completion. I've never had a job over $100,000 though, come to think of it, Ive never had a job over $5411.00
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Old 02-06-2006, 06:51 PM   #5
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Re: How Much Money Do You Get Up-front?


I do mostly small to mid-sized excavating work and on jobs less than $1000 I don't ask for anything down. I ask for 1/2 down on anything greater than that.

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Old 02-06-2006, 06:58 PM   #6
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Re: How Much Money Do You Get Up-front?


most jobs I do 30% down as a safety net, alot of special orders. Job prices mostly in the 15 to 25,000 range. I put in contract 30% half way and never ask for it. The rest on completion. To me it sounds like your customer doesn't have enough money to cover the work you are doing...

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Old 02-06-2006, 07:26 PM   #7
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Re: How Much Money Do You Get Up-front?


Small jobs ( which is what I mostly do) very little material, nothing down.

Mid to larger jobs ( to me 8k-10k is a big job) usually 1/3 down 1/3 half done
1/3 completion.

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Old 02-06-2006, 07:27 PM   #8
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Re: How Much Money Do You Get Up-front?


Quote:
Originally Posted by rino1494
On smaller jobs, we don't ask for anything until the job is done. On jobs that over $100,000, we usually ask for 10%. Then the balance when job is completed.
Rino,
Hopefully you never get burnt. 10% down on 100,000 is on the light side in my opinion. For what it's worth I'de go for 20% down and then structure your payments so when you're done they don't owe you more than 10%.
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Old 02-06-2006, 07:31 PM   #9
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Re: How Much Money Do You Get Up-front?


1/3 down to schedule
1/3 payment half-way
1/3 final payment

If its larger than 10k, or will go on for several weeks, then progress payments tailored to the job.
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Old 02-06-2006, 07:32 PM   #10
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Re: How Much Money Do You Get Up-front?


I generally ask for my marked up material cost. Unless the materials are less than $100. If the job involves a lot of labor, I'll give the customer a graduated payment schedule with the proposal.
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Old 02-06-2006, 07:37 PM   #11
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Re: How Much Money Do You Get Up-front?


for jobs over $1k:

1/3 up signing, 1/3 at drywall installation, 1/3 upon completion. All CO's due upon signing.

Words to live by:

"If they balk, I walk"
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Old 02-06-2006, 07:43 PM   #12
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Re: How Much Money Do You Get Up-front?


There are usually state laws for that sort of thing. 30% is the largest legal deposit that I have ever heard of. Of course you can ask for another payment when you or your company and the materials arrive/start date, and progress from there.

We have always done 10% down, balance on completion unless we smell something wrong. Then we will write in different terms.

I can understand the guys point of not wanting to pay 1/2 for a deposit. Most consumer awereness articles, warnings, etc., would advise not to pay half for the deposit.

What type of business are you in. If the materials and equipment wiil be half the price of the job, I would think that you could get 25% deposit and another 25% at start.

JMO and the laws as I have understood them to be.

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Old 02-06-2006, 08:03 PM   #13
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Re: How Much Money Do You Get Up-front?


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Old 02-06-2006, 08:05 PM   #14
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Re: How Much Money Do You Get Up-front?


I always ask for the total of estimated materials up front. Most of my jobs are $25k-$35k in labor, and I usually ask for a small portion upon ratification of contract, to lock in my customer. If they decide to bail on me I figure I should get something for blocking out my schedule for them and not accepting other jobs. I'll usually ask for 30% up front, and if it's a long job I'll ask for an additional 30% halfway thru. Then the balance upon completion.

I've found leaving a large amount outstanding at the end leaves customers to think they can short me on final payment.
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Old 02-06-2006, 08:12 PM   #15
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Re: How Much Money Do You Get Up-front?


usually get 20% to start and then progress payments tied to completion of certain tasks. Try to get all but 10% before projects end.

Question: how come people are willing to pay HD in full up-front?
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Old 02-06-2006, 08:36 PM   #16
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Re: How Much Money Do You Get Up-front?


For jobs under $1000 - 50% down, 50% when completed

Everything else: 30% down, 30% when materials are on site, Balance upon completion - No exceptions.
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Old 02-06-2006, 08:52 PM   #17
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Re: How Much Money Do You Get Up-front?


I don't bother with small jobs, but the larger ones it's 30/30/30 or 50/50
I 'm trying to figure out a way to get 30/50/50
If I figure it out I'll post up
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Old 02-06-2006, 08:58 PM   #18
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Re: How Much Money Do You Get Up-front?


Quote:
Originally Posted by slickshift
I don't bother with small jobs, but the larger ones it's 30/30/30 or 50/50
I 'm trying to figure out a way to get 30/50/50
If I figure it out I'll post up
Yeah, and I'll gladly pay you on the second Tuesday of next week!
Or, was that 2 for half the price of 1 today?
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Old 02-06-2006, 08:59 PM   #19
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Re: How Much Money Do You Get Up-front?


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Old 02-06-2006, 10:06 PM   #20
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Re: How Much Money Do You Get Up-front?


Most of my jobs range $8k to $20k. 20% required to schedule, 30% due on start date and balance due at completion unless it takes longer than a week. Then another 20% at a week then balance. This is adjusted as I see a need. I recently did a bathroom counter using expensive granite tile, marble vessel sinks and high end faucets. Cost of these special order items were added to the initial 20%.

Rich

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