Credit checking
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Sharpend
"It Just Is"
If you're asking about the regular joe public then no, if you're talking about a big contract that could gave serious repercussions on you should they fail to pay then definitely.
I'd say find out all you can about a new customer , including credit check.
A few observations after many years in the trade .
1. Domestic , most older customers have been fine ...about 1% became fly pickers , looking for money off etc .
2. Domestic , the new breed of 30 somethings , often working from home on a PC all day , video conferences etc , smartarses oblivious to the fact that you should be paid 3. Young women , late 20s early 30s who run shops ...don't really want to pay you , imagine fluttering eyelashes will get jobs done for sod all. PITA .
4. Long standing business needing regular sparky , generally honest , cherish them .
5. A new builder phones .... Hmmmm where,s his last sparks , why hasn't he built up a relationship with regular sparks?
6. Worst offenders ... fellow tradesmen who have pulled you in to help ...busy period ...need your experience ... need extra hand .... doesn't want to pay you once finished.
7. Posh people , generally, more likely to rip you off than working class .
8. There are some good honest intelligent builders about but in a minority , most are full of their own importance who think you sit awaiting their call all year round .
A few observations after many years in the trade .
1. Domestic , most older customers have been fine ...about 1% became fly pickers , looking for money off etc .
2. Domestic , the new breed of 30 somethings , often working from home on a PC all day , video conferences etc , smartarses oblivious to the fact that you should be paid 3. Young women , late 20s early 30s who run shops ...don't really want to pay you , imagine fluttering eyelashes will get jobs done for sod all. PITA .
4. Long standing business needing regular sparky , generally honest , cherish them .
5. A new builder phones .... Hmmmm where,s his last sparks , why hasn't he built up a relationship with regular sparks?
6. Worst offenders ... fellow tradesmen who have pulled you in to help ...busy period ...need your experience ... need extra hand .... doesn't want to pay you once finished.
7. Posh people , generally, more likely to rip you off than working class .
8. There are some good honest intelligent builders about but in a minority , most are full of their own importance who think you sit awaiting their call all year round .
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What Deke said +1
i don't advertise
i don't have a website
because I am with TalkTalk my number is not in the phone book
my 'van' is not sign written
any new customers come by recommendation from at least 2 unrelated sources...then I decide if I want to do the work or not
if it feels .01% wrong I won't touch it, even if they offer to pay upfront. Been caught ONCE , that was enough
I have been doing this job for a very very long time so fortunately I have built up a very good client base...on the downside of this I work on trust.
I have never credit checked a client, I wouldn't know how to.
I do little or no domestic work BUT my commercial clients seek me out because they need me....so they trust me to do the job and I trust them to pay me
so far it's worked ok BUT I can see the need for people starting out and wanting to know that the client has the money to pay...even if they don't want to
just rambling and taking hints from mr merlot...he hasn't been around for a while
i don't advertise
i don't have a website
because I am with TalkTalk my number is not in the phone book
my 'van' is not sign written
any new customers come by recommendation from at least 2 unrelated sources...then I decide if I want to do the work or not
if it feels .01% wrong I won't touch it, even if they offer to pay upfront. Been caught ONCE , that was enough
I have been doing this job for a very very long time so fortunately I have built up a very good client base...on the downside of this I work on trust.
I have never credit checked a client, I wouldn't know how to.
I do little or no domestic work BUT my commercial clients seek me out because they need me....so they trust me to do the job and I trust them to pay me
so far it's worked ok BUT I can see the need for people starting out and wanting to know that the client has the money to pay...even if they don't want to
just rambling and taking hints from mr merlot...he hasn't been around for a while
Sharpend
"It Just Is"
as per Deke and Kerching, I don't credit check small domestic jobs although these can be the slowest payers. The people I trust least are the 'nouveau riche', these seem to have mostly got wealthy by being winkers. Employed middle classes seem to be OK most of the time, and snobby women can make your life miserable. (Their husbands are usually OK oddly enough).
For contracts over say £200 I like to be fully compliant with 'doorstep selling legislation' and issue a contract upfront and take a deposit before starting works. Legally you aren't supposed to start any works before the customer has had 10 days to 'cool off' . Failing to comply with this means legally they can just not pay, and even claim money paid back add infinitum (there's no time limit). The legislation was set-up to catch rogue traders, but has been left so wide open that it can seriously affect genuine tradesmen and women. I especially like contracts for the customers I don't fully trust. If they fail to stump up the deposit in good order, cancel contract and walk away.
The times I mostly get caught out are when I'm busy as heck and don't communicate fully with the customers. Emails are great, verbal contracts are difficult to prove in court. It is always worth a quick email confirming a conversation even if you don't issue a contract. It doesn't happen often, but is really frustrating when it does as the law is really set against us! You need to develop a sixth sense, unfortunately this takes years to achieve.
For contracts over say £200 I like to be fully compliant with 'doorstep selling legislation' and issue a contract upfront and take a deposit before starting works. Legally you aren't supposed to start any works before the customer has had 10 days to 'cool off' . Failing to comply with this means legally they can just not pay, and even claim money paid back add infinitum (there's no time limit). The legislation was set-up to catch rogue traders, but has been left so wide open that it can seriously affect genuine tradesmen and women. I especially like contracts for the customers I don't fully trust. If they fail to stump up the deposit in good order, cancel contract and walk away.
The times I mostly get caught out are when I'm busy as heck and don't communicate fully with the customers. Emails are great, verbal contracts are difficult to prove in court. It is always worth a quick email confirming a conversation even if you don't issue a contract. It doesn't happen often, but is really frustrating when it does as the law is really set against us! You need to develop a sixth sense, unfortunately this takes years to achieve.
Doc Hudson
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Unfortunately not all good tradesmen are good businessmen. And as Binky said customers can have quite a few legal rights for not paying if you haven't got some form a clear agreement about a schedule of work and payment terms. So whilst one side of a coin may be credit checking potential customers, the other is making sure your terms of business are as reasonably water tight as practicable. A customer may have a 100% credit record but also have very strong grounds to refuse or withhold payment(s) if everything is just verbal. Think about how often, when you order or download something on-line, you have to tick a box to say you agree to the suppliers terms and conditions. Yet how often do tradesmen enter into relatively high value work with no formal agreements on paper or electronically?
It may help to approach each new prospective job with the mind-set, "can I survive if this customer doesn't pay me for several months?" A small labour only job may be no problem. But a large material intensive job with big wholesalers bills at the end of the month could be a different issue. Cash-flow kills more business than lack of work. So if a 4month delay would be a big problem, then tighten up on your terms and conditions and formal contract agreements before starting. And re-assess them if the job changes part way through. This may be easier and more useful than a credit check on someone who can run rings around you due to lack of contract.
Doc H.
It may help to approach each new prospective job with the mind-set, "can I survive if this customer doesn't pay me for several months?" A small labour only job may be no problem. But a large material intensive job with big wholesalers bills at the end of the month could be a different issue. Cash-flow kills more business than lack of work. So if a 4month delay would be a big problem, then tighten up on your terms and conditions and formal contract agreements before starting. And re-assess them if the job changes part way through. This may be easier and more useful than a credit check on someone who can run rings around you due to lack of contract.
Doc H.
If dealing with builders / developer types, it's also worth having a look at Companies House. I nearly got caught a few years ago by a well known rogue 'buisnessman'. When I checked he wasn't listed as the Director of 8 small companies, all of which had been formed less than a year ago. So I dug a bit deeper, found out his son was registered as the director of these businesses, then dug some more and asked around. Turns out this fella is famous for not paying the final bill on lots of jumped up excuses. I tracked down the previous electrician (name was let slip) - not been payed in full for previous job.
But what got me going was a phone number. On emails everyone puts a phone number, not this guy, and the fella who worked for him that I was dealing with always phoned from a withheld landline. Job was a large restaurant fit-out. No electrical plans, no fire alarm plans, nothing on paper. No plans for the restaurant and kitchens either. Previous electrical contractor was from out of the city (cos he carrotted off all the locals previously). All seemed rather odd, cos it was! Job was £30k ish 12 years ago. I tried internet searching for a company phone number, and that led to finding out the rest of the info about this dodgy *******. It would have destroyed my business. If something doesn't seem right, check it out! I've met far too many trades destroyed by these *******s. Nothing like mentioning names at wholesalers counters either cos they usually suffer as well!
But what got me going was a phone number. On emails everyone puts a phone number, not this guy, and the fella who worked for him that I was dealing with always phoned from a withheld landline. Job was a large restaurant fit-out. No electrical plans, no fire alarm plans, nothing on paper. No plans for the restaurant and kitchens either. Previous electrical contractor was from out of the city (cos he carrotted off all the locals previously). All seemed rather odd, cos it was! Job was £30k ish 12 years ago. I tried internet searching for a company phone number, and that led to finding out the rest of the info about this dodgy *******. It would have destroyed my business. If something doesn't seem right, check it out! I've met far too many trades destroyed by these *******s. Nothing like mentioning names at wholesalers counters either cos they usually suffer as well!
Good example there Binky.
We were approached by a "builder" who was putting up two bespoke 4 bed houses on some land in our area. He wanted a price in a hurry , they were slightly different so my mate took drawing for house 1 I took house 2 for quoting .
Mate phones me on the night , he'd called in for his usual snifter at his local which is always full of tradesmen ...mentions we're quoting for the houses at so & so ....plasterer turns round , announces the guy owes him big time , followed by a plumber , also owed .
We just binned the drawings and he never phoned to chase up . Lot of 'em about .
We were approached by a "builder" who was putting up two bespoke 4 bed houses on some land in our area. He wanted a price in a hurry , they were slightly different so my mate took drawing for house 1 I took house 2 for quoting .
Mate phones me on the night , he'd called in for his usual snifter at his local which is always full of tradesmen ...mentions we're quoting for the houses at so & so ....plasterer turns round , announces the guy owes him big time , followed by a plumber , also owed .
We just binned the drawings and he never phoned to chase up . Lot of 'em about .
Why is it I just "Scoobed " Binky's post , just above ..and it says "Zero"
Sharpend
"It Just Is"
It says (1) now :C
thank you Evans
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