Is it wrong to ask for a small deposit for new customers? I just had a customer complain that he didn't know who I am so was uncomfortable giving me a deposit. I told him I didn't know who he was either and if your spending the money anyway...right.
Up front money?
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I never ask for money up front.. but I am a minority here..
When they say.. "I don't know you either".. remind the customer you could lose your electrical license over something stupid like not performing the work you were being paid to do..
Asking for a deposit turns some people off right away.. just the way it is.. why I don't ask for one..
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39,117 Posts
Depends on the amount and what the state laws are there.
5-10% isn't too much to ask for, but you may not be able to legally ask for more.
You could also require the deposit at the end of the first day.
Like all things, it's negotiable. You could also ask how he plans on funding the job (money in savings, loan from credit union, etc.) and ask for proof of such.
5-10% isn't too much to ask for, but you may not be able to legally ask for more.
You could also require the deposit at the end of the first day.
Like all things, it's negotiable. You could also ask how he plans on funding the job (money in savings, loan from credit union, etc.) and ask for proof of such.
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The risk is on both sides but more for the Electrician in my opinion.
You are licensed, insured, bonded? Have a company trucks with your name on it?
Who's more likely to rip who off?
If your a real business you can provide them with a receipt with a company letter head. I always get upfront money on jobs over a certain amount.
Are you a bank or an electrician?
You are licensed, insured, bonded? Have a company trucks with your name on it?
Who's more likely to rip who off?
If your a real business you can provide them with a receipt with a company letter head. I always get upfront money on jobs over a certain amount.
Are you a bank or an electrician?
I think it's reasonable to expect to get a percentage of the money up front the day you start the job. If they can't/won't front some money when you show up with permit and materials in hand I don't see how you can expect to ever get paid. Some general contractors won't operate like that but if you're working for an established company they are likely to pay you.
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7,985 Posts
That is why you
need to build up your credit base,so you look reputable to the customer.Only ask for up front money on jobs you can't finance over 30 days.
need to build up your credit base,so you look reputable to the customer.Only ask for up front money on jobs you can't finance over 30 days.
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418 Posts
Lots of industries and businesses ask for deposits for services so why would a electrician not be reputable asking for a deposit?
A few years back I had Sears do some work in my home and they required my credit card number to start job and Sears could not be more established. I think it shows a commitment to a contract and also gives us another signed document for legal proceedings if needed. But I do agree it could turn off a consumer but as a consumer myself I do not mind paying a deposit for a service I agree to.lovethetrade said:
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Why is that? We are Electrical contractors not banks.
If a customer doesn't want to give me a deposit I don't do the job END OF STORY
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We never ask for money down for small projects. We stock most items anyway so whats the big deal? Our customers write a check after inspection passes. If its a larger project we ask for a material draw when the material is delivered. I mean honestly on a small project how much do you really have in materials? Most cases not that much. The customers that call us want the service we provide and pay us when we are done.
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A credit card authorization is fine. The customer can dispute it. Cash or check is different IMO.
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One of the benefits of being a little bit larger business is that you appear more legitimate and rarely get any flak for deposit requirements.
When I was a one man operation I rarely asked for a deposit because I wanted the people to trust me so I broke the ice by trusting them. I don't remember ever getting screwed.
We generally ask for 50% deposit with balance on completion.
When I was a one man operation I rarely asked for a deposit because I wanted the people to trust me so I broke the ice by trusting them. I don't remember ever getting screwed.
We generally ask for 50% deposit with balance on completion.
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7,355 Posts
Every job we do we get money up front usually 50%. I use to be one of those that didn't ask for cash up front until I realized my bills needed payed on time and employees wanted a paycheck on friday. You invoice someone and you could easily be looking at 30 days or more before you see any cash.
Buy getting money up front I never dip into my own funds to finance jobs.After waiting two months to get paid on a two day job I decided to change the way we operated now it a deposit or no work plus once you get the deposit they wont keep looking for someone cheaper which also happened. Nothing like shaking hands on a job friday to then get called Sunday to tell you they went with someone else.
Buy getting money up front I never dip into my own funds to finance jobs.After waiting two months to get paid on a two day job I decided to change the way we operated now it a deposit or no work plus once you get the deposit they wont keep looking for someone cheaper which also happened. Nothing like shaking hands on a job friday to then get called Sunday to tell you they went with someone else.
It is not just Sears that operates that way just about all the services I had done at home required a deposit or up front money, and you had to sign a contract in every case, none of these companies are banks and they all have to assure they are paid for the work they provide, my son made the mistake of not getting up front payments or signed contracts when he started, working with up, he is still paying off the $7k we lost, no need to say he learned the hard way, he was a bleeding liberal, who loved and trusted everyone, now this dog not only hunts he bites.Gamit said:
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I don't work for Indians anymore for that exact reason. Call me racist or whatever but based on my experience with them they are insanely cheap to a point they are delusional.
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One nice thing about getting a deposit is that a sale has been made. Depends on the job specifics if we ask for one or not. I always allow for not more than 10% due after final inspection.
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