Is this right? Paying 50% Deposit before installation.

[makka619]

Getting a cupboard (carcass/door) made and installed for $1200.

The guy just asked for a 50% deposit before they go ahead with the job. He said he forgot to tell me, and that it is a requirement for all jobs under $5000.

It's not a huge deal but I want to check if this sounds right. Mainly because I have had bad experience with tradies recently who have stuffed us around; one of whom we paid half of the quote before the completed the job..

[JDub]

IME its not unusual to ask for 50% if you are getting something custom made for you.....

[eemgee]

Makka619,
It may not be unusual but I would be wary of anyone that wants a 50% deposit,
In all my time of subcontracting and owner/building I have never paid more than a 10% deposit, and mostly no deposit and paid for goods when they arrived on site.
You have to protect yourself and the norm would be pay for what goods have arrived on site and to withhold enough money until the job is finished that if the contractor leaves & doesn't come back you can pay someone else to finish the job.
There are a multitude of reasons for a contractor not coming back to finish a job and most owner/builders would be able to tell a few of them.

[arms]

You have to protect yourself

and dont you think that the contractor should be entitled to protect him/her self ,in all cases i get a deposit and i dont care who they are because over the years i have found that if the customer cant pay a deposit as required then how will they pay for the balance ,as the law stands anything that gets taken onto a site belongs to the owner of that site ,so following that reason people should be thankful that they are not asked to pay in full BEFORE any thing is delivered ,

[joe greiner]

[QUOTE=arms;462216]as the law stands anything that gets taken onto a site belongs to the owner of that site QUOTE]

Sounds quite drastic. Does Oz law have provisions for mechanics lien? Many years ago, I worked in manufacture of custom-made architectural precast concrete. We always had to execute a release of lien to receive final payment.

Joe

[bricks]

In S.A I am allowed to ask for Total materials cost plus 10% for jobs over 12,000. I dont unless the customer looks dodgy, wants to pay at a later date or asks for custom fabrications.

When ever I do this i produce a contract for the job with start, end dates and a full breakdown of costs. This should hold up in court IMO should i not do the work, or customer not pay me.

You could find a different tradie, or ask for a written contract that includes start and end dates.

If you pay a deposit you should also sign a contract. No contract, no deposit id say.
It would'nt be fair for the tradie to protect himself and not offer you protection also.

[Bleedin Thumb]

as the law stands anything that gets taken onto a site belongs to the owner of that site ,so following that reason people should be thankful that they are not asked to pay in full BEFORE any thing is delivered ,


Thats pretzel logic I recon.


The law does not state that materials become the owners belongings when they get taken to site.
The laws states that a contractor does not have the right to remove a fixed item from site.

Big difference.


I never ask for a deposit. If I need money straight up I negotiate a progress payment when I start on site.

Since the Security of Payments Act 1999 came into effect the only reason's a subie needs a deposit is because they haven't got the finances to carry the job or they don't trust you.

Either way - not a good start to a working relationship IMHO.

BTW I never start a job without a very good (fair) contract signed such as AS 2124.

[Sturdee]

The law does not state that materials become the owners belongings when they get taken to site.



EXCEPT when the owner is a company and that company goes into either receivership or liquidation. All property on site (which includes materials delivered) then belongs to the Receiver/Liquidator and you are left holding the bag as another unsecured creditor.

Been there, and in fact tools left by subbies locked up overnight on site were also confiscated by the Receiver and sold at auction to satisfy his appointing creditor whilst the subbies were unsecured creditors and got 5 cents in the dollar 4 years after the event.

Hence a decent deposit is not unreasonable.


Peter.

[seriph1]

my opinion is that a solid deposit is a fair thing to ask for and pay. 50% was what I was told, one of our local Kitchen makers charges. He explained that he had subbies to cover, materials to purchase and labour to undertake. The 50% went a good way to covering these expenses and ensured commitment from the customer. If they refused, then he walked, plain and simple.

Personally, I will have difficulty asking for that kind of money up-front as a designer, but I get 30% before I start and I basically have no materials costs or subbies - but I do have a lot of time to invest, which I cannot get back, and there are people out there that once they see their designs, think they are not worth the cost (though honestly, I have never had that happen to me) - I think it boils down to who it is, what the job is and what's fair. If the price was fair and the final payment is not given over a second before the customer is happy, then I doubt it matters. We all have a right to protect ourselves.

have fun

[makka619]

Something doesn't feel right about it.

He seemed like a decent guy. But he has come around twice before calling up to add this information that he 'forgot'. First time for a quote, second time to measure. I wasn't questioning him on the phone... just saying "oh okay", but he kept telling me that it wasn't his choice, it is his managements. Should I ask him for a written document that states this rule.

Honestly, I wonder if it is because he doesn't trust me...

Or is it means I shouldn't trust him.

[Bleedin Thumb]

EXCEPT when the owner is a company and that company goes into either receivership or liquidation. All property on site (which includes materials delivered) then belongs to the Receiver/Liquidator and you are left holding the bag as another unsecured creditor.
.


Peter.


Point taken however most commercial contracts wouldn't involve a deposit especially 50%.

[Lignum]

As a furniture maker i ask for 40% up front and ballance on delivery. No one complaines. Its standard practice

[bricks]

In S.A.
Just looked in my book thingy bout it, tradies can ask for pretty much anything they like same as their quote can be what they like,
The $12,000 is where progress payments are made, i can ask for enough to cover the next stage of work to be done ( materials), plus ten percent. This includes the deposits aswell.
If i choose not to use progress payments, once again i can ask for anything I like. ( with plumbing) I belive when building a house/extension this might change.

I still say if handing over cash, get a contract,

[makka619]

Well we can pay the money, but it just makes me wonder why he is asking for it now.

I told him that we can pay him (full) when he comes around, but he said it is required before.

hmmmm

[Lignum]

Well we can pay the money, but it just makes me wonder why he is asking for it now.

I told him that we can pay him (full) when he comes around, but he said it is required before.

hmmmm

Dont be a tight ass Macca:wink: :D I hope you realise how much it costs to run a business, especialy a trade based one that requires materials to be purchased and the time to actualy manufacture it, then deliver and install.

Asking for a deposit is standard practice and if i had someone refused to pay a deposit with me, well bad luck, i wouldnt start on the job required. You should have a gut feel if he is legit, and you said you can pay, so why stress. Pay the poor tradie his deposit and wait for a job well done:)

[makka619]

Dont be a tight ass Macca:wink: :D I hope you realise how much it costs to run a business, especialy a trade based one that requires materials to be purchased and the time to actualy manufacture it, then deliver and install.

Asking for a deposit is standard practice and if i had someone refused to pay a deposit with me, well bad luck, i wouldnt start on the job required. You should have a gut feel if he is legit, and you said you can pay, so why stress. Pay the poor tradie his deposit and wait for a job well done:)

okay I will pay it.

It is a really good deal, much cheaper then the other quotes and he said he can do it right away, have it completed by next Friday.

Didn't think I was being a tight ass, paying him on completion. :(

It isn't funny how many tradies have stuffed us around. Guess I am paranoid now, whereas before I wouldn't have even thought twice about it.

He quoted me $1200 but hasn't given me a written quote. Now what do I ask for in a written contract to be super careful?
Time
Cost
Description of job
Required 50% deposit

Anything else?

Are all hinges these days the self-locking ones? Or do I need to double check?

[Lignum]

It is a really good deal, much cheaper then the other quotes and he said he can do it right away, have it completed by next Friday.

Im always carefull when its a good deal, much cheaper and can be done straight away. Most furniture makers have a lead time of 8 - 12 weeks if their any good and have a plentifull supply of work


Didn't think I was being a tight ass, paying him on completion. :( :D dont stress i was just having a friendly dig:D



He quoted me $1200 but hasn't given me a written quote. Now what do I ask for in a written contract to be super careful?
Time
Cost
Description of job
Required 50% deposit

I just give a verbal quote and then when they agree the work will go ahead then get a written quote. Generaly its all layed out on the invoice they get when the deposit is payed.

[pawnhead]

I had to pay a big deposit on the glass I recently ordered for my doors. They seemed like a reputable company and they knew their business. I had a good gut feeling so I just payed the whole lot. I've got no complaints at all with the glass or their prompt delivery.

I also had a slightly nervous situation as a builder once. I signed a contract for a $50,000 job with virtually just a bit of coin to my name and no line of credit organised. I got the ten percent deposit which paid for my materials, and I signed up some subbies on no deposit. Needless to say I worked up a sweat pulling long hours trying to get to my first progress claim so I'd have something to pay the boys with.

Everything went very smoothly and I made a tidy profit on the job, but it was a bit of a risk I took there. :U

[Bleedin Thumb]

John I know that feeling well! Then you get the client that decides to jerk you around and the whole thing comes unstuck!

[arms]

you really should be getting a detailed written quotation before you pay the contractor anything ,so that BOTH of you know what is entailed in the job ,by detailed i mean all work and material types that will be used in the job as well as payment shedules ,read it and make any changes you may have on the original both sign and date it then copy it and both have a copy on file just in case something goes wrong ,nothing may but because you are both aware of the other having a signed copy this will give a bit of assurance that nothing can go wrong

[pawnhead]

John I know that feeling well! Then you get the client that decides to jerk you around and the whole thing comes unstuck!Yes, that's the only thing that concerned me. I had every confidence that I could do the job properly and run the job from claim to claim, but you can't foretell if you're going to get jerked around, as is often the case.
I've found that the richer a client, the more likely they are to jerk you around. Especially with the final payment, since they've got what they wanted then.

[Bleedin Thumb]

Thats why I haven't done a domestic job for over 10 years. and I usually won't go near builders with the proverbial 10' pole. Local government was the only work I'd do (with some private corporation work)
Unfortunately I am coming off a five year hiatus of doing the home dad thing - with some sporadic consulting project management in between - so its back to working for Dodgy Bros. builders again.:(

I feel like i'm starting out from scratch again, but It won't take long to get back to the feed trough.:D

[Guy]

For any cabinet work i do, its 50% down 30% on delivery and 20% on completion. If they havent got the 30% when i come to deliver the goods stay in the van.
Have been burnt several times now by non payers.

But then i accepted a good paying contract job so the cabinet making will be now done evenings and weekends just to keep the business going just in case

[makka619]

Im always carefull when its a good deal, much cheaper and can be done straight away. Most furniture makers have a lead time of 8 - 12 weeks if their any good and have a plentifull supply of work Did you have to say that... I don't know what to think now. :Clol They have a storefront so I guess when I go into pay the deposit, I can get a better feel of the business.



:D dont stress i was just having a friendly dig:D
yeah i know:p

[makka619]

For any cabinet work i do, its 50% down 30% on delivery and 20% on completion. If they havent got the 30% when i come to deliver the goods stay in the van.
Have been burnt several times now by non payers.

But then i accepted a good paying contract job so the cabinet making will be now done evenings and weekends just to keep the business going just in case

Guy can you tell me what type of wood cabinets are made in... are they all done in the same type? Or are there some dodgy materials out there I should be aware of?

I can't work out why this guy has quoted me such a cheap price, when all the others are upwards of $1000.

This is the one we are replacing:

http://img.photobucket.com/albums/v306/little_bear_81/cboard2copy.jpg

http://img.photobucket.com/albums/v306/little_bear_81/cboardcopy.jpg


There will be smaller doors up top. Not paying extra for a colour, just going with the standard white doors.
He quoted me $1000 for the carcass and full length doors. With the 3 draws and smaller doors at the top it is $1200.

[Cabbie]

Yeh that looks about right. That is about what I would charge if I did the job myself. The people charging more probably are doing so as there isn't a hell of a lot of money in the smaller jobs. Just looking at it rom what you have shown it would come in at around 500 bucks for the carcass for the board. The doors and drw fts maybe a little more fr the board and maybe 150 bucks. Th drawers would proly be another 40 bucks or so depending on wheter they use dcent drawers or not then you gotta allow maybe 6 hours labour @ around 65 bucks an hour which wouldbe 390 and then GST on top of that comes in at 1188 so yeh 1200 is about right. :)

[makka619]

Woot! Thankyou so much Cabbie. :D:D:D

[Cabbie]

No probs I skimped a little on the labour though just thinking about it. I never allowed for if there may have been a problem with the walls or something when they go to install maybe an extra 2 hours which aint much still anyways ;) Not a big or difficult job and a decent price too in my opinion.

[seriph1]

are you going to paint the interior white to make it brighter inside? Just looking at the whole thing, what's wrong with the frame that's there? You could paint it nicely and get some doors made to hang off it, then fit out the interior as you want.

[Tezza]

The State Government of Victoria Law says that, upto $20K you may ask for a 10% deposit, anything over $20K you may only ask for a 5% deposit 'before' starting a job. Listen to those words carefully. Whomever asks for more than the Law states, could be in very serious trouble with the Law if found out. Breaking this law actualy means commiting a criminal offence.
You should also be supplied with a contract stating exactly what you are being made and a schedule of payments.

Hope this helps :q

T

[seriph1]

Hi Tezza and welcome to the forum! Please point us in the right direction as to where we can access the same info as yourself..... it is an important consideration for me as I intend to ask for far more than 10 or 20% deposits from clients.

have fun!!!!!

[Tezza]

Hi there Steve,
Thanks for the welcoming :U

Okay, you asked for the information....

http://www.buildingcommission.com.au/www/html/1344-legislative-publications.asp?intSiteID=1

then look in the Building Act 1993, Domestic Building Contracts Act 1995. And check out the other ones which may interest you
~~~~~~~~~~~~~~
http://www.dms.dpc.vic.gov.au/ search for the relevant acts here, such as the Building Act 1993, Consumer Affairs Act 1972

When you open these in PDF do a word search. A note, where at the end of a rule it says "10 points" or "50 points" etc, these are actually penalty points and each point is worth $1K, these are penalised to the person that has committed the offence.
To give you an example:
http://www.buildingcommission.com.au/resources/documents/Domestic_Building_Contracts_Act.pdf

In the above Act, Division 2 section 11 it reads:

"Division 2—Restrictions Applying to the Nature and
Contents of Contracts
11. Limit on amount of deposit
(1) A builder must not demand or receive a deposit
under a domestic building contract of more than—
(a) 5% of any contract price that is $20 000 or
more;
(b) 10% of any contract price that is less than
$20 000—
before starting any work under the contract.
Penalty: 100 penalty units.

(3) If a builder does not comply with sub-section (1),
the building owner may avoid the contract at any
time before it is completed. "

Thats 100 points!!!

Don't be scared LOL be afraid :roll:

Read the words carefully and read INTO them. It says "before" starting any work. Once you've started, ask for as much as you like, but it has to be on a contract with a schedule of payments.

Starting means, by having proof that you have started ie an invoice with the date from your materials supplier. Make sense?????

I can give you more detailed information but they amended the Building Act in Oct 2006 and I simply don't have the time to read the whole thing again.

Hope this helps

T
:2tsup: