# How much money down do you ask for before scheduling, beginning a project?



## 1thumb (Jun 30, 2012)

Not asking about $10k custom pieces, but built-ins, cabinets, custom closets, etc. in the $2-5k range.


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## RobHannon (Dec 12, 2016)

As a hobbyist I try to get my materials covered. If I were doing this for a living I suspect I would have to got to a hard percentage of the total, but I also would probably be charging more for my time and have better prices on materials so it should still get close to covering materials.


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## JCamp (Nov 22, 2016)

I've never been the contractor but I have hired a few. Generally they get 50% up front, 25% half way through and the final 25% at the end. I've dealt with 3 different guys and they all do this, and they are all well respected contractors. Its my assumption that the 50% up front covers nearly all the material cost. The 25% in the middle covers any labor (likely for the whole job) so that they don't get screwed if the customer doesn't pay the final bill. And the final 25% is profit. Its worth noting that my projects were all "construction" stuff like decks, siding, buildings and those went up to $12k not just the 5000 that you mentioned. The bigger the job, such as a house or garage, would likely require more payments. Also a really fast job may require less.
Sad to say but its really a "cover your butt" thing. If someone isn't happy with the finished product then they can refuse to pay and may not allow you back in to retrieve what you built so you should allow yourself enough money to at least not go in debt doing it if you don't get that last payment. Also some ppl are just turds like the folks that throw a fit at restaurants and make a big show just to get a free meal.


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## BroncoBrian (Jan 14, 2013)

NEVER get yourself upside down on a project. Everyone is nice until they are not. I was a contractor for a long time and I made sure we were always ahead on parts and labor. Leaving 10% for the last payment is fair and should be enough incentive for you to complete a punch out list. Offering them a chance to create a punch list (even when you know it won't exist) is enough to build some trust and keep your customer at ease.

Getting contractors to finish a project is difficult. So making them know that you expect to give them a few days to make sure everything is as epic as they expected, then asking for your final payment to be paid within 5 business days keeps both of you happy.

I think the best service comes from charging enough to solve problems. If you are short on material or mess something up, or they cause a change, you are better off have a margin available to fix it without having to defensive or send change orders.

Edit: There is a reason high-end services and get referrals and those businesses grow. They can afford to impress people and leave the best impressions.


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## jonah (May 15, 2009)

Whatever you decide, I'd definitely put it in writing. Even a very simple, typed contract that spells out exactly what you'll be doing, the time frame, and the payment schedule is incredibly useful. Make it look professional. Pro tip: you don't need a lawyer to write and execute a contract. Just be very clear about what each party is supposed to do.


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## msinc (Jan 8, 2017)

If you are going to build something and then install it you had best be getting ALL the money for the build up front, no exceptions. E.g., a custom bathroom vanity that you charge $3000 for and another $500 to do the install would require $1500 to get started, the other $1500 when the vanity is complete and STILL IN YOUR POSSESSION and $250 to start the install. The final $250 is due when you get it in the house and are finished. Any customers that balk at this "way of doing business" needs to be politely dismissed. Many guys wont do it though and what you really need to be considering is the difference between losing business {what it seems like to dismiss a customer} and losing money. The simple fact is that if Mr. Customer is not going to pay you anyway where is the loss??? I throw in the "no exceptions" because friends and family are the most likely to stick you.


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## JAAune (Jan 22, 2012)

For that type of project, it's usually 50% down and 50% upon completion but it also depends upon how expensive the material cost is.

But I also do a lot of commercial work and those jobs usually don't pay until after delivery. Commercial jobs can pay well but you need to have your shop and finances in order to swallow the up front cost of a project.


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## jacksdvds (Jun 13, 2015)

> Whatever you decide, I d definitely put it in writing. Even a very simple, typed contract that spells out exactly what you ll be doing, the time frame, and the payment schedule is incredibly useful. Make it look professional. Pro tip: you don t need a lawyer to write and execute a contract. Just be very clear about what each party is supposed to do.
> 
> - jonah


X2 on what Jonah said. A verbal contract isn't worth the paper it is written on!! Make sure you include legal fee conditions if needed to collect must go to court.


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## 1thumb (Jun 30, 2012)

Thanks everyone. It's a damn shame, but as someone posted, 'everybody's nice until they're not.' Keep up the good work


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## 1thumb (Jun 30, 2012)

Quick follow up: I live in a large metropolitan area and have been picking up mucho work from recommendations on the neighboorhood Nextdoor app. Part of town I live in is going thru a lot of growth/gentrification. I feel a little more at ease dealing w/clients from this source, and the commute is great. Good source for work


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## msinc (Jan 8, 2017)

If there is really that much work in the area you should have no problem getting paid up front. As someone else already posted, once you do a job and install it you cannot go back and take the thing you did back out. It's theirs whether they pay you or not. All it takes is one good time of getting really stuck for some serious time and money and you will wish you had followed my first post. Ask me how I know…..


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## RichT (Oct 14, 2016)

Someone keeps mentioning building and installing. Be sure to check your local rules and regulations regarding licensing and insurance before you do any installs. Since you say you live in a large metropolitan area, you might also check to see if there are any union restrictions to you doing the installing. Those are folks you do not want to cross.

I build 'em, but I don't install them. It saves me a ton of grief.


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## woodbutcherbynight (Oct 21, 2011)

I agree with Rich. I will build it, you get it installed and to pick it up requires the last 50%. No payments etc etc. I do the rare customer pay build but I do not start until the 50% is down in cash in my hand.


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## 1thumb (Jun 30, 2012)

I don't have a problem, msinc, usually ask for 50% just asking what others do.

No unions to speak off.

I don't necessarily like to install, myself. But for a couple of buit ins, custom closet, etc. I'll do it. I pay myself well for the effort. I'm a valued employee.


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## CWWoodworking (Nov 28, 2017)

One of the reasons I went 100% wholesale.

I dont ask for a dime. If I have problems with payment, I dont sell them. Easy peasy. I have only had 1 issue with a store not sending check. I pushed a little, and they gave me a CC to keep on file. No more problems.

Be it retail or wholesale, I would get a Square and raise your prices to accomidate. CC make it easy. The 3% is worth it.

I cant tell you how many thousands of dollars I have "up sold" because I have square. Especially if you deal with women a lot.


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## RichT (Oct 14, 2016)

> One of the reasons I went 100% wholesale.
> 
> I dont ask for a dime. If I have problems with payment, I dont sell them. Easy peasy. I have only had 1 issue with a store not sending check. I pushed a little, and they gave me a CC to keep on file. No more problems.
> 
> ...


What are you selling? I do agree about taking cards. I use PayPal just because I've had an account for years and the chip/strip reader was free. No better or worse than Square.


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## WoodenDreams (Aug 23, 2018)

I build to order. I get 20% down on regular projects, before I start. If I consider it a specialty project it's 50% down. If prepaid in full with cash or check I give a 5% discount. I do offer a Lay-Away plan, 20% down and 20% per month, with a 20% restocking fee if they decide to stop the lay-away. I do take all the major credit cards, but give no discount with credit cards.


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## MrRon (Jul 9, 2009)

i think we are speaking here only of licensed contractors. As a licensed contractor, he can file a mechanic's lean if the customer reneggs on payment. A non-licensed contractor (NLC) who is doing projects for others has no such recourse and asking for money up front is his only recourse. As a NLC, I have built many projects for friends, family and even for businesses and always got paid. I would ask for money to get the material, but left the final payment up to the customer. There is a certain amount of trust when working as a NLC, but I have never gotten burned. Of course, I don't work as a NLC any longer due to age. A hand shake has always been my contract.


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## CWWoodworking (Nov 28, 2017)

> What are you selling? I do agree about taking cards. I use PayPal just because I ve had an account for years and the chip/strip reader was free. No better or worse than Square.
> 
> - Rich


Furniture and home accents.

I dont have a ton of accounts that use cards, but its there when I need it.


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## JRigg (Jan 13, 2019)

I see this is an older thread but thought I'd chime in. I work primarily in occupied homes for individuals, on projects that typically range 5 to 12k, with only a few projects for contractors and such. I typically advise my clients to never pay in advance any sort of deposit unless they are paying a material bill to the material vendor. There's a lot of fly by night Wonder Kids and Soy Boys making a killing on good folks round here.

As for myself, I float the materials up to 5k, with no labor until complete on individuals and contractors.


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