Why do customers think they are entitled to credit?

[Aquaheat]

Isn't this a DIY forum? Seems like a trademan's forum..

We are the trades that answer the questions for the DIYers.

We have our own forum for Gas Safe engineers but I put it in this open forum as I wanted an unbiased view from both customers and trade alike.

An RGI is a Registered Gas Installer

Jon

 

[Aquaheat]

Sounds like you've been unlucky.

Isn't this a DIY forum? Seems like a trademan's forum..

We are the trades that answer the questions for the DIYers.

We have our own forum for Gas Safe engineers but I put it in this open forum as I wanted an unbiased view from both customers and trade alike.

An RGI is a Registered Gas Installer

Jon

 

[DavidSWP]

@DavidSWP While I understand your comments about being stitched up by a poor installation there area few points to bear in mind from a trade point of view.

1) Once the materials are at your house they are (generally) at your risk
2) Once they are fixed in place an installer cannot remove them (legally)
3) On a larger job, the financial exposure to a poor customer can be significant and irrecoverable
4) Minor jobs are the one's where no up-front payment is needed - low risk
5) Materials have a value and are the customers property once paid for

I suspect that we've (trade) all had a few bad experiences with slow-paying customers - usually the one's who want everything done as quickly as possible but seem to be slow finding card/cheque when the jobs finished.

I'm not disagreeing with anything you say, just giving a customer perspective. If a new installation doesn't work or partially doesn't work we have the courts. That is the route I took and got a partial 33% refund out of court. Some would argue for legislation and ombudsmen etc. but I am for the free market. OP can run his business however he wants as far as I am concerned. There is no issue. OP can charge upfront, customer can decide. No issue.

 

[DavidSWP]

Isn't this a DIY forum? Seems like a trademan's forum..

We are the trades that answer the questions for the DIYers.

Jon[/QUOTE]

Much appreciated

 

[Aquaheat]

Isn't this a DIY forum? Seems like a trademan's forum..

We are the trades that answer the questions for the DIYers.

Jon

Much appreciated[/QUOTE]

No worries and thanks for the input.

Just to give an idea why I posted this. The client that rang me this morning, who I've never worked for before, wanted 3 sets of taps replacing on period sinks. I gave him a few ideas of what would suit via email and he asked for a price on a certain set. They were £47 per pair. Taking into account pipework, fittings, isolation valves etc the material bill would've been around £150 to my pocket. Labour would've been £120 as I allowed 2 hours total.

I sent him another email confirming the works and that materials would be payable before ordering. I put it to him that I would be able to book him in Wednesday morning of next week as it being my only free spot. I got a call back of him about half hour later saying that he would pay it all on the day. I told him that I don't operate that way and explained my reasons.

Anyway, to cut a long story short it finally came out that he hadn't the money straight away and would definitely be able to sort it for Friday of next week at the latest!! This is an example of why I do what I do. It weeds out those that just don't want to pay.

Jon

 

[endecotp]

Say you borrow the £150 on a credit card. If you get paid by the customer next Friday, you've paid a week's interest - about 60p I think. So your choice is either (a) don't do the work, or (b) pay 60p to cover the delay to the income. To be honest, if you have enough demand for your services that you can afford to choose (a) then you are a lucky man.

 

[endecotp]

Great example of someone who's unlikely to want to pay upfront for anything in the future:

//www.diynot.com/diy/threads/kichen-and-bathroom-disaster.455152/

 

[DavidSWP]

Ok so this is a situation about a (probably*) minor job but with materials you would not hold on stock. Period sinks - taps that you would probably not be able to use for another customer. So I would say, "please pay for taps upfront because they are a specialised item, balance payment on satisfactory completion." . Sounds like you are talking about a very particular incident whereas your OP sounded like a general gripe. Sit down, have a Whiskey

* Fully agree that minor jobs can turn out to have a lot of problems..

 

[Aquaheat]

Say you borrow the £150 on a credit card. If you get paid by the customer next Friday, you've paid a week's interest - about 60p I think.

No, if they need the parts then THEY borrow £150 on their card. I offer card payment services for this situation. My accounts will happily cover £150 but why should I? Lets use your analogy ( you seem to like using ones that have no relevance but...) If I were to put £150 on my credit card and accrued 60p interest and then the customer doesn't pay will the CC company accept that I won't pay the balance until the customer has paid me? Why is it my risk to take?

Please tell me of a service industry where it is expected that you are entitled to £00's or £000's of pounds credit without a credit check?

Jon

 

[Driver123]

Interesting thread because I'm just about to get a new boiler and central heating modifications carried out. The heating engineer has asked for and been given a 50% deposit. It surprised me that this is his policy to be honest because I have had extensive work carried out over the last three years involving plumbers, electricians, builders, plasterers etc. and not one of them has asked for payment up front. The reason I agreed to give him it is that he is a well established firm with excellent online reviews but it does worry me what would happen in the unlikely event that his company went bust before the work was carried out. Also I googled it and it does seem common for heating engineers to ask for money up front. From his point of view I can understand that he has to buy a large amount of materials before he starts the job. From my point of view, I can't afford to lose the money so I will be counting the days until the job is started.

 

[Aquaheat]

Great example of someone who's unlikely to want to pay upfront for anything in the future:

//www.diynot.com/diy/threads/kichen-and-bathroom-disaster.455152/

Not really as they have paid more than the cost of materials! Completely different situation to what I was suggesting.

 

[Aquaheat]

Interesting thread because I'm just about to get a new boiler and central heating modifications carried out. The heating engineer has asked for and been given a 50% deposit. It surprised me that this is his policy to be honest because I have had extensive work carried out over the last three years involving plumbers, electricians, builders, plasterers etc. and not one of them has asked for payment up front. The reason I agreed to give him it is that he is a well established firm with excellent online reviews but it does worry me what would happen in the unlikely event that his company went bust before the work was carried out. Also I googled it and it does seem common for heating engineers to ask for money up front. From his point of view I can understand that he has to buy a large amount of materials before he starts the job. From my point of view, I can't afford to lose the money so I will be counting the days until the job is started.

Just as an addition to your post and as the OP may be I can lessen your worry a bit more.

You invited this gent into your home and he walked and talked with you discussing your requirements and options with you. You felt comfortable enough then to go ahead with his quote regardless of the price but it must have been reasonable but he inspired the most confidence in you.

He then asked for a 50% deposit. You were comfortable to pass this on too. While I can't give an exact representation to your situation let me tell yo what I would've done.

If the job was more than 1 week in advance I would have asked for £100 deposit to hold the install slot.

1 week before I would require the money for the materials to be cleared funds by whatever means you see fit and I would order all materials to be either delivered to your property or mine whichever is mutually acceptable.

You then wouldn't pay another penny until the job is complete, you have had a tour round the system, shown it's working and explained the set up to you, all paperworks completed on site and boiler registered.

50% might be a little excessive but I can't see the job and at the end of the day that is his terms. Did he give you a Schedule of Works?

Jon

 

[endecotp]

You're free to take that approach if you want, and if you get plenty of work then that's great.
I just wanted to suggest that the costs of providing credit are not enormous, and that IF you could get more business (or better / more interesting / more profitable business) by providing short-term credit then it might be worth considering.
In my own (unrelated) job, I would have had zero work over the last decade if I'd insisted on your terms.

Regarding credit checks - I've never been credit checked by a contractor, and I've never paid for materials in advance - so, all of them? Though normally for hundreds, rather than thousands, of pounds of credit.

 

[DavidSWP]

Interesting thread because I'm just about to get a new boiler and central heating modifications carried out. The heating engineer has asked for and been given a 50% deposit. It surprised me that this is his policy to be honest because I have had extensive work carried out over the last three years involving plumbers, electricians, builders, plasterers etc. and not one of them has asked for payment up front. The reason I agreed to give him it is that he is a well established firm with excellent online reviews but it does worry me what would happen in the unlikely event that his company went bust before the work was carried out. Also I googled it and it does seem common for heating engineers to ask for money up front. From his point of view I can understand that he has to buy a large amount of materials before he starts the job. From my point of view, I can't afford to lose the money so I will be counting the days until the job is started.

Buyer beware. I would not pay anything until work is completed satisfactorily. What use is a half working system to you? More grief than its worth. OP seems to think that you got some stuff that is useful to you once its on your premises. If the company goes bankrupt half way through, try finding someone to pick up where they left of - [yoda]find it easy you willl not [/yoda]. And its not "unlikely" that there will be problems. There's a reason this industry has a bad rep.

 

[Aquaheat]

Ok so this is a situation about a (probably*) minor job but with materials you would not hold on stock. Period sinks - taps that you would probably not be able to use for another customer. So I would say, "please pay for taps upfront because they are a specialised item, balance payment on satisfactory completion." . Sounds like you are talking about a very particular incident whereas your OP sounded like a general gripe. Sit down, have a Whiskey

* Fully agree that minor jobs can turn out to have a lot of problems..

But I don't stock boilers, unvented cylinders, PCB's, Divertor valves, Baths, showers etc etc. Do you realise how many different parts are available in many different styles, sizes, guises and colours. I keep general stock items to the tune of about £4k and I won't hold any more than that.

There are very few "standard" plumbing or heating jobs.

I just wanted to see why credit was thought to be an entitlement rather than a privilege of a long standing or trusted client?

Sat down with beer in hand though David. Cheers

Jon