Flow Management

[Deleted User]

The first inclination is to lower your price to get more work. Now is NOT the time to be doing things for free. Stand your ground on price and crank up the volume on value. Sell radiant comfort instead of selling heat. Make yourself unique in that respect and the work will seek you out.

I guess if you were considering some sort of diversification, service would be my recommendation. People that need service don't generally bicker over price. If you've got the time, they've got the money, and they don't have much time to waste, so they are willing to pay a little more so they don't waste any more of their time than necessary and are wiling to pay more to get it done right the FIRST time, so they can keep making MORE money... Does that make sense? Time IS money.

Hang tuff and stand proud. This too shall come to pass...


PS, at a minimum, you should be charging interest on the outstanding debt. It's only fair.
ME

singh

The Cash Flow that is...

Since I started my biz (2001), the jobs keep coming and gross sales have been going up each year. And I have jobs lined up for the next six months at least. Thanks in part to the "Green" bandwagon evryone seems to be on lately.

But, lately I've notice the payments have been taking longer and longer, or I get bits and pieces, even though my contracts have a set percentage due to me when X amount of work is complete.
I still need to pay my suppliers, gas and payroll, and right now my greatest tool is a bank line of credit.

Now I don't know if its the economy, but it seems like something is changing. Should be interesting during this "slow down" period.At least 'til November ; )

My question goes to those in business that have already weathered recessions or slow times. How do you deal with slow payers? Do you charge for estimates? Do you diversify your services, or stick within a niche specialty that maybe your competitors are not able to under bid you in?

Any thoughts appreciated. Thanks.

Devan

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bruce_21

I have a clause in my contracts that calls for 1 and 1/2% per month interest after a two week grace period. This is what I will have to pay on my credit cards if I don't get the money I have coming. I point it out discretely to people in advance to make sure they know I expect to be paid when the payment schedule calls for it.

bruce_21

Put a mechanics lien on any job that doesn't respond to requests for payment. You have only four months from the last time you did any work there, so you have to stay on top of things. Works pretty well on new construction or any situation where there is a bank involved, ties up things for a year, then you must go to court.