Money in and out of a job.
WHY IT IS THE CENTRAL DIFFICULTY
Contractors pay for materials and labour before being paid.
WHAT THAT PRODUCES
A funding gap that grows with the size of the job.
WHAT TO ESTABLISH BEFORE ACCEPTING WORK
Whether you can fund it to the first payment.
WHAT TO NEGOTIATE
A deposit sufficient for initial materials Payment stages at short intervals Payment within a defined period after each stage
WHY SHORT INTERVALS
Long stages mean long exposure.
WHAT TO AVOID
Payment only on completion Stages defined so vaguely that they are disputed
WHAT TO DEFINE
Each stage, observably.
WHAT TO DO AT EACH STAGE
Apply for payment promptly, with evidence.
WHY PROMPTLY
Delay in applying is delay in being paid.
WHAT TO INCLUDE IN AN APPLICATION
What was completed Any approved variations Any materials on site, where the contract allows
WHAT TO TRACK PER JOB
Costs incurred Payments received The gap between them
WHAT TO WATCH
The gap widening.
WHAT TO DO ABOUT SLOW PAYMENT
Raise it immediately, in writing.
WHAT TO ESTABLISH IN THE CONTRACT
What happens if payment is late.
WHAT TO DO IF IT CONTINUES
Suspend work, having given proper notice.
WHY PROPER NOTICE
Suspending without it may be a breach.
WHAT TO TAKE ADVICE ON
Suspension and termination.
