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From contributor D: We had a contract, about 2-3 pages, with terms and conditions. Last year we went to a much longer contract - the "terms and conditions" portion also talks about what their responsibilities are, what ours are, additional samples, change orders, and other stuff that people don't think about until it's a problem. What we've been doing is splitting out an installation fee in the contract, which is not subject to sales tax. That portion gets paid when installation is substantially complete. The rest (usually about 90% of the total price) is split into two payments - one to start, the rest when we deliver. If it's a very big project, like a $65,000 job we had last fall, I split it into three payments. That way they feel it's less money up front, but we end up getting 2/3 of the payments before we deliver - it's helped spread our cash flow better.
From contributor J: Our system is 30% on commencement, 30% when half the cabinets have been made and inspected by the client, 30% when everything is completed and ready to go, and final 10% after satisfactory installation From contributor A: I've taken 30% on signing, 60% on delivery, and 10% on completion for years. On large jobs or jobs that get split up, we divide the 60% into two payments. I haven't had any problems but I'm thinking we may be able to go to 40%, 50%, 10%. When I talk to others I always seem to be the guy with the smallest deposit. From contributor D: One of the things I've considered, especially on the larger types of jobs that we'll be working on pretty much exclusively for that time period, is what all of my expenses are for the time I'll be working on it - what money's going to be marching out the door for materials, payroll, rent, electric, gas, phone, insurance, payroll taxes, garbage service, internet, web site, etc. I think only getting 30% until you're actually done with building is risking too much of your own capital/cash flow. One of the things that flashes in my mind when I flirt with guilt over asking for a decent price or deposit - for some reason, my work is expensive but $3000 to $5000 for a television (what many of my clients spend) is not?!
From the original questioner: Thanks for the input. I have thought for some time that we were lower than most on our deposits. We have always taken 30% deposit, balance on delivery. With some of the larger jobs we have had lately, that really strings us out. Seems to me that most of your thoughts are in the same ballpark. I think the key is spelling those payment terms out in a signed contract. From contributor C: Our terms are similar to contributor T's with a minor exception. Also, having the terms in a written contract is a must. It prevents misunderstandings and is, in our opinion, more professional. Here is a cut and paste from our contract. This section is included right after the description of work to be done. The other "terms and conditions" (such as warranties, etc.) are included later in the contract. ==============================
All of the numbers ($ and %) are in bold. We go over these figures with the client as we review the contract before signing. Notice that we ask for the 40% before we even load the truck at our shop. This avoids the possibility of excuses, delays, etc. at the job site, a lot of wasted time, or worse, getting stiffed. The clients can see the finished goods in our shop prior to delivery if they so desire. If you are getting a design fee, and applying it to the job, you can list that here also. It will show the client how they are getting a credit for that fee. For example, your terms might then be 10/40/40/10 (10% for the fee, 40% Production Deposit, 40% before delivery, 10% after substantial completion of the job).
From contributor D: A signed contract of some sort is a must. It's not just about protecting yourself if something goes bad (even a contract can't stop that from happening). It's spelling out all the details, so that little or nothing is open for being misunderstood... none of that "but I thought..." "I was expecting..." And even if you put on the contract that a second deposit is due in three weeks or on a specific date, you'll still need to remind them. From contributor Q: We sent our contract to our lawyer for review, and she said we have covered all the business and none of the legal which would render our contract almost worthless in a court room, so the contract was rewritten. You may want to run your contract by a lawyer - that might save you a ton of grief. I also find detailed and signed and dated shop drawings and specifications as important as a contract. Have you reviewed the related Knowledge Base areas below? 
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