What do you do when a progress payment from your customer is late? Cuss the customer?

Normally (but not always) progress payments are late because you failed to communicate clearly when the progress payment was due. The payment schedule should be in your contract, and all payments scheduled at the start of some phase of the job. You can argue about when something is completed, but you can’t argue about whether it started.

In your contract, specify a down payment on every job and a material payment for special order items, regardless of size. Then specify each progress payment, and they should be scheduled about two weeks apart. Your final payment should be 2% of the final contract price, maybe 5% in rare cases, but never more.

A detailed description of how to set up your payment schedule can be found in the book, Markup and Profit Revisited.

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