What is your tactic to collect payment?

Vaa Fakaosifolau Said: Its good that you got your money in the end woody, its very generous of you to help finance the Fred and Barney start up, ;) because thats the way I look at it. Weve had a lot of GCs delay payment, and I know they were using the money to start other projects or fend off the wolves themselves. Way to many people operate with insufficient capital. I would hate to sit down and work out how much it has cost us over 16 years for all those late payments. A couple of days here and there maybe a week or so on a handful and a few took a month, throw that money in the bank for the total period they were all overdue and likely there would be a tidy sum of interest out of it. How many are like me and are just so glad we got our money and let slide pursuing any penalties? they are even harder to collect :woohoo:

All "real" business have some receivables out there floating all the time. It's just a normal part of business. Yes, there is a cost associated with it but it's not something that it unique to roofing companies. And, it's not something to fret about...anymore than it would make sense to fret about the cost of roofing materials. It's all part of the cost of doing business.

I suspect that most tradesmen, and the companies that they form, don't properly capitalize themselves before they start in business and therefore every payment delay is magnified. If they were properly capitalized, they would view the delay in getting paid as "normal business".

Also, another reason why these delays are so frightening to tradesmen/businessmen is the uncertainty. Many of them (the contractors)don't fully understand how to use the laws to collect their money. Their contracts are riddled with loopholes. They don't pay lawyers to write them, nor defend them and as a result, their fear of never collecting overshadows the facts of the situation.

I've lived this life....

"A company or goverment which robs Peter to pay Paul can always depend on the support of Paul." Shaw.

Many years ago I was hired to reroof an old mansion that had become rundown. While doing the roof, the local paper ran the rags-to-riches story on the guy that hired me. He invented those coin operated machines with a chicken that lays a plastic egg that they used to have in grocery stores. I did the job expecting cash on completion, but when I was almost done a guy that had done stucco work came by and told me that the owner was stalling on payment.

I hurried and finished and when I gave the guy the bill, he gave me a check for about a third of it and said he would have the balance in 2 weeks. So I dropped by his office in two weeks and he gave me another check for $1200 and told me it'd be another week. This was only getting up to my material costs and I was getting pretty upset. When I went in a week later, his secretary said he'd just stepped out. But through the tinted windows I noticed someone was in his office when I was in the parking lot, so I told the secretary I'd wait. I sat there about 20 minutes while she nervously tried to keep up the lie by telling callers "Bob stepped out."

Finally another guy goes into his office and I can hear two people talking and the other guy comes out with a check of a couple grand and tells me "Bob left this on his desk in case you came by." But he also told me they were in the midst of closing a big deal with their new 'Fred and Barney' machines and would have the balance in two days and they did. Fred and Barney saved me.

I can remember one time that I wasn't paid upfront for a dump rental. I went to the end of the driveway, called the local Sherrif to make sure that this material still was theirs. Once they stated that it was I began to lift the dump. The homeowner came out immediatly to give me a check. Problem was solved in a matter of minutes. On our dump rentals we still try to collect upfront but have been known to get payment at the end of the job. We know that we will use that tactic again if not paid. On our roofs we have only had a select few pay late. I sure wish I would have used Mike's method couldv'e paid bills faster that way. LOL B)

A guy owed my brother a bunch of money once. Denny went there about dinner time and knocked on the door. THEY LET him in. No trespassing! He sat down and just stayed there. They were having dinner and he just sat in the dinning room with them and kept asking for his check. He explained to the homewowner with his family there what was wrong and put the guy on the spot. Denny is a big crazy man too, and certainly the homeowner didn't want to mess with him My brother got his money that night and then he left.

It's no more legal in Ohio than anywhere else, but when you're right you're right, and most folks that are dead wrong usually don't think too clearly when they are cornered. It worked, but it's not a method I recommend for the light hearted.

Mike H Said: since egg mentioned it........

Twice, we have put a crew on the roof, axes in hand.

The owner is confronted, and told Listen, this has gone on long enough. I know that it takes exactly XX minutes to reach this facility from the police dept. It will take you 5 minutes to write a check, which leaves me with XX minutes to remove roof. If the check isnt in my hands in 6 minutes, we start taking off what is still ours. We wont get much of it off, but I guarantee you the damage will be substantial. Time to decide. Either start writin or make your call. Time starts now..

On both occassions, we got our check. Most collections go through more civil channels.

That tactic won't work here in Texas. We would be allowed to pull out our hardware and start shooting! We don't have to be nice to tresspassers here.

since egg mentioned it........

Twice, we have put a crew on the roof, axes in hand.

The owner is confronted, and told "Listen, this has gone on long enough. I know that it takes exactly XX minutes to reach this facility from the police dept. It will take you 5 minutes to write a check, which leaves me with XX minutes to remove roof. If the check isn't in my hands in 6 minutes, we start taking off what is still ours. We won't get much of it off, but I guarantee you the damage will be substantial. Time to decide. Either start writin' or make your call. Time starts now.".

On both occassions, we got our check. Most collections go through more civil channels.

Had a customer doing a remodel on a historic home. Owner was doing most of the restoration himself with the exception of the clay tile roof. Showed up for a pre-inspection meeting. Guy sounded like a flake, beer cans all over the front porch (think of Artie Lang in "Beer Fest" movie...you know...Howard Sterns sidekick). Immediately noticed that new tile was going to be higher than the window seals and lots of areas for potential of rotted wood. Just everything about the looks of the guy, his roof, and his charactor brought up red flags for us.

The owner of our roofing co. demanded verifiable funds before we set foot on the project.

The results....He works over the internet at home, has an engineering degree, and inherited the home and half a mil. from his deceased grandmother. He was very insulted with us, but he got over it quickly and we moved on with the project.

Over coffee this morning. This conversation came up ... the new savvy homeowner upside down in his mortgage owes the bank near foreclosure gets Sam and Dave remodeling and roofing to renovate the house...Or whatever the fudge they do...instead of paying them, will go out and buy a boat or cruise. “Let them have it and pay the mortgage and taxes etc.” They can't get me to move out for at least a year maybe more . I just listened GOD bless the contractors today. Life is sweet ????

I think I know what you mean on that one "VAA". In collecting payments, I was asked to collect everything even though we will have wait for a sub to finish or go back for punchlist items. But what I found is that by collecting partial amount and leaving a few hundred on the table...(for customer satisfaction)...It takes even longer to get the rest of the bill paid.

More time and energy are wasted, and when you calculate everything together...you just spent that money anyways.

If it meant a couple of more days, I was instructed to wait for full payment.

Hire sicilians they're good at collecting the payments.:)

I went on a bid with the owner of the roofing company that I worked for part time on the weekends. He would tear it off and I will come in on the weekend to shingle as I had a full time job. Guy said he paid a roofer cash to shingle his 35sq 4/12 7 years before and it is leaking in over 8 spots. After listening to the homeowner talk, I got funny feeling and I mention to the roofing owner something wasn't right. He went ahead and bid the job out showed up the next day in person to give the bid.

Homeowner said if he wanted the roof, he would have to do everything off the books and wanted to neogotiate specifics. The roofing owner refused (he won't do business that way). Homeowner had the gall to ask him if he knew someone on the side that could do it.

1. Homeowner didn't take into account that he got screwed once and is doing the same thing again....some people will never learn.

2. The homeowner was going to be doing the screwing this time.

Protection and the principle are the key issues here !

I've been stiffed or partially stiffed a few times but it's about like dougger describes it. In my case I failed to pay attention to warning signs. I try not to do that anymore.

woody is the MAN!

(ask MikeH how he got paid one time...)