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Lead times and deposits...4/23
so i have a customer ive done work for in the past and we both walked away from as expected,me happy with the pay, him happy with the job.it was a remodel done to his offices,bathrooms,break room and examine rooms.
Simple-hit the guy with a 5% non-refundable retainer, 30 when you actually start the job and standard terms.
One or the other.
Either he puts a down payment towards the current pricing structure or he takes the chance that the price might go up in that time frame.
You can't have it both ways. It sounds like you have already given them a good deal by allowing the old price to stand.
Business is business.
What Leo said. You can contract it and give me money and you can have that price or we can re bid it next year and prices could go up.
thanks for your input guys, i was starting to think i was out of line or going nuts..haha.
Keep in mind, your customer can not go out and obtain another bid based on older pricing for materials. Any new bids from a competitor would be at current pricing. If you are going to honor the old price, stand your ground on the other terms, or at least be sure they work for your operation. When customers start messing around with my terms, I start asking them what they want to surrender.
Have an honest heart to heart with the client.
Most people are understanding - especially if they are business types.
Zdraft,that's what i tried to begin with,and how our conversation ended Wednesday.I'm suppose to pick up a check Monday(tomorrow),or i move on to the next client.we'll see,
It seems to me that you are right in principle, but what does the quote/contract say? I'm guessing it doesn't say anything, or you would not be asking the question. So, at the least, you've learned something for the future.
At this point, with no clear answer in writing, you have to decide if you want to do the job for less money than you'd like, and possibly strengthen your relationship with an "advertiser" and potential future customer, or sever ties. You have far better understanding of the impacts than any of us.
alright so monday has came and went.
My impression? 33% is too steep for a retainer. 10% is more realistic and would probably make your customer a lot more comfortable and you could have avoided the whole situation. There's a difference between a retainer and a deposit. A retainer holds a spot, a deposit is used to actually purchase materials. Asking for a deposit for materials 4 months in advance makes you look desperate for cash, which despite the history between you two is why your customer is uncomfortable.
I respectfully disagree with Derek.
10% Means that if he finds someone who is 20-25% cheaper in 4 months- then he's still ahead by walking away from his deposit - while you are turning clients away to hold his spot - and i'm pretty sure that 10% will go little way to paying for your loss of business.
Stick to your guns, respect your business and the obligation you have to your guys and family to keep it profitable.
Maybe settle for 20-25% deposit, other than that - don't waste your time and find a client who appreciates your skills and reputation.
I agree with Derek. 33% is to high for a retainer.
well,i'm sticking to my guns..
Side question. Does OT really cost you any money?
My opinion, in a manufacturing environment, not generally. 50% of the actual direct labor costs is typically less then the associated overhead, which is "free" on OT.