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View Full Version : Is this typical when dealing with commercial accounts?


thefed
02-29-2008, 02:41 PM
I'm putting a bid in at a property that is quite huge....and we've never dealt with such a thing. The few commercial properties we maintain were off-shoots of residentials....so no formal proposal process.

This one is through a friend of a friend, so we have a small edge. The thing I'm wondering is if it's typical/acceptable for them to set the payment terms? The guy showing us around said they pay 60 days afterinvoice (Net 60), if we give a 2% discount they pay in 30 days, 3% discount for 15 days, 5% discount and they pay same day.


Would it be unprofessional of me to state in our proposal that OUR payment terms are 15 days...period. Or maybe extend it to 30 for them?

Also,what format does one usually submit said proposal in? Residentials are a bit different....so im just wondering...

thanks

Raven386
02-29-2008, 02:45 PM
I'd say give them your terms... but if it comes down that you wont get the contract maybe just deal with the 2 % discount...just add enough to the price of cut to make it up in the end...

IMAGE
02-29-2008, 02:49 PM
I would just build it into the price also.

Grassbuster
02-29-2008, 02:51 PM
In all my commercial accounts they always set the payment terms. They need to feel they are in control........I do agree 60 days is a bit much but they did offer you options. Mine are 32 days. At first I hated it, however after many years you know that the check is in the mail on the 30th day. Good luck

thefed
02-29-2008, 02:55 PM
I dont want it to be a sticking point of course....but i got the feeling that it was more 'this is the way it is'


The guy is pretty cool with my partner,and said it takes 2 guys 8 hrs, and 4-5 guys 4-5 hrs..... I have NO guess on the acreage.....it's pretty wide open with minimal trimming....but there's a lot of grass.

IMAGE
02-29-2008, 06:45 PM
So your bidding on it not knowing the size or your costs? At least measure it and get a better estimate of your time involved.

5 guys x 5 hours is 25 hours
4 guys x 5 hours is 20 hours
2 guys x 8 hours is 16 hours

9 extra man hours on that job every week would kill your profit. Also, sometimes "the guy" really has no idea how long it takes, or what equipment they were using. They may of had 72" Z's and if your using 52" Z's well, there go some man hours too. You may want to run more numbers (any numbers by the sounds of it) before bidding.

Albery's Lawn & Tractor
02-29-2008, 07:02 PM
Thats normal. Like another already said you figuring the interest or penalty, whatever you want to call it, into your bid. Showing them YOUR terms isn't going to do anything, and chances are if they see that, your bid will get thrown away no matter if your price was lower. Commercial work isn't for everybody, but it can be profitable. Good luck.

Flex-Deck
02-29-2008, 07:08 PM
I have one commercial acct. that deducts 2.5% for a 15 day pay. Normally they are 90 day after invoice. A couple of others make the adjustment, and pay in 15 without a deduction. Either way - I do not like waiting 90 days. It is well worth the deduction, and come to think about it, I bid it high enough that it is ok.

Daily Lawn/Landscape
02-29-2008, 08:07 PM
Bid your commercials with a little extra in the basket and offer a discount at 15 & 30 days You will get your money a lot faster in most cases.

lawnman_scott
02-29-2008, 08:57 PM
I have never had anything like that, even a govt contract, but I would just work it into the price.

ed2hess
02-29-2008, 10:09 PM
[QUOTE=thefed;2181806]I dont want it to be a sticking point of course....but i got the feeling that it was more 'this is the way it is'

Might as well get used to it being their way.....doesn't hardly matter what the contract says they pay when they are usually ready. And trying to add in late fees just ties up bills because they get confused concerning a different amount than they expect and that delays thing even further. Build late payment into the bid and forget it and get a business loan to run your business if that is a problem.

lawnman_scott
02-29-2008, 10:14 PM
[QUOTE=thefed;2181806]I dont want it to be a sticking point of course....but i got the feeling that it was more 'this is the way it is'

Might as well get used to it being their way.....doesn't hardly matter what the contract says they pay when they are usually ready. And trying to add in late fees just ties up bills because they get confused concerning a different amount than they expect and that delays thing even further. Build late payment into the bid and forget it and get a business loan to run your business if that is a problem.
Good point. I bet the phone, electric and morgage companies feel the same way when dealing with these customers.

thefed
02-29-2008, 11:11 PM
So your bidding on it not knowing the size or your costs? At least measure it and get a better estimate of your time involved.

5 guys x 5 hours is 25 hours
4 guys x 5 hours is 20 hours
2 guys x 8 hours is 16 hours

9 extra man hours on that job every week would kill your profit. Also, sometimes "the guy" really has no idea how long it takes, or what equipment they were using. They may of had 72" Z's and if your using 52" Z's well, there go some man hours too. You may want to run more numbers (any numbers by the sounds of it) before bidding.


I didnt measure and never have. IF I came up with the sf.,acreage,etc....it would be of no use to me. I basically eyeball sections that are comparable to something I already do....and judge the time accordingly. It has worked well so far.

LB1234
03-01-2008, 03:33 AM
If I read this right its gonna take 8 man-hours to do this service. At 8 hours per week that's between 32 hours and 40 man-hours a month (assuming monthly billing) you need to cough out before an invoice is even generated. And I'm just talking about payroll not your operating expenses.

I dunno seems like an awful lot of money to wait to get for 60 days. I would do a serious cash flow projection (perhaps you already have) and bill in what you need to to fill in the gaps. If you even you even need to.

ALL my commercial accounts are on a monthly billing cycle and ALL are 30 days. Granted I only have 6-7 but none of them have dictated what the payment terms were. And I'd say 3-4 of them pay before even the due date AND don't ask for discounts for paying early.

Bottom line, personally, I wouldn't like the 60 day payment terms. How many other service industries offer that? I can't think of any. Another thing, I make sure to have the maximum allowable late fees by law and ENFORCE them and stick to your guns. Usually when I get these kind of phone calls the inner alarms start to go off and I start asking the questions to determine if they are price shopping for the lowest guy.

topsites
03-01-2008, 03:59 AM
Typical?
Oh yeah, yeah, just another one of those things that never ceases to amaze me.

txgrassguy
03-01-2008, 07:14 AM
My company has held contracts with various commercial/governmental sites and I have never heard once of a discount policy towards accounts receivables.
Additionally I simply refuse to allow receivables to age more than 30 days and as of right now, all are on a net 15 payment schedule.
All of this said, you have to do what you have to do.
Provided you are going to be awarded this gig, factor everything into the price + at least a 20% buffer to account for the hidden variables.

Indy Kyle
03-01-2008, 07:40 AM
If you can afford the hit the first 60 days then go for it. Just think, when the contract is up and your finished with the property your still gonna get a couple extra checks in the mail. Then you'll think it's not such a bad deal.

thefed
03-01-2008, 09:43 AM
If you can afford the hit the first 60 days then go for it. Just think, when the contract is up and your finished with the property your still gonna get a couple extra checks in the mail. Then you'll think it's not such a bad deal.




Very true.

I should have explained though that we have more than enough working capital to pay for our expenses as we go...the 60 day wait won't kill us....it just seems excessive.

I think I'll leave it out of the Proposal, but slip it into the contract if we get the job...and go from there.... everything's negotiable if you play it right

PROCUT1
03-01-2008, 03:31 PM
Letting the customer dictate the payment terms?

This site keeps getting better and better.

Gee lets get in over our head, bid a job we have no clue how to propose, and tell the customer they can pay whenever they want..

No wonder while expenses are increasing every year, the price for service keeps going down.

Someone actually said to get a LOAN to support a late paying customer.....Thats the best right there.

Does anyone own a BUSINESS here? Or is this a hobby for everyone?

captn
03-01-2008, 03:32 PM
I'm new to landscaping, but am usually on the other side of the table negotiating with you. I managed several commercial properties and we try to get at least 60 days from any service providers. If you give 60-90 days for payment, I can manage my expenses better and keep book keeping expenses down as I only need to hire them once every 2 months rather than every month. this is why the discount works for me on 30day payment, in essence, you are paying my book keeping fees with the 5% discount to manage your 30 day payment schedule.

This is a negotiable item. If your price is right, they certainly are not going to throw your bid away. If your business can manage with the 60 day schedule, then set your terms in the bid. if they demand a discount for early payment, then ensure there is a stiffer penalty for late payment. that's how you can limit them taking advantage of the payment terms.

PROCUT1
03-01-2008, 04:47 PM
I'm new to landscaping, but am usually on the other side of the table negotiating with you. I managed several commercial properties and we try to get at least 60 days from any service providers. If you give 60-90 days for payment, I can manage my expenses better and keep book keeping expenses down as I only need to hire them once every 2 months rather than every month. this is why the discount works for me on 30day payment, in essence, you are paying my book keeping fees with the 5% discount to manage your 30 day payment schedule.

This is a negotiable item. If your price is right, they certainly are not going to throw your bid away. If your business can manage with the 60 day schedule, then set your terms in the bid. if they demand a discount for early payment, then ensure there is a stiffer penalty for late payment. that's how you can limit them taking advantage of the payment terms.

Good to see someone from the "other side"

This is the only business that I know that people "wet their pants" to get a "big time commerical account." They are more concerned about being able to say they have the account, than actually getting paid or profiting.

The fact that the lawnboys just accept "this is how we pay" is comical.

Do you really think "thats how they pay" everyone?

Do they pay their mortgage at 60-90 days and the mortgage company says DURRR, ITS OK...THATS HOW THEY PAY..

How about electric? Employees? Visa? Suppliers?

No...They have to pay all those bills on time because otherwise there are CONSEQUENCES.

Pay your visa bill 1 day late and youre paying a $39 late charge and getting your interest jacked up to 39%.

Do you people really think that low of yourselves that you have to approach these "commercial accounts" on your knees and beg them to ALLOW you to mow their lawn?

Try growing some balls and approaching these BUSINESSES like a BUSINESS.

Its lawnboys like this that have trashed the commercial market for real service providers.

topsites
03-01-2008, 04:59 PM
It seems the guy from the association either is uneducated on how to deal with business owners, or quite simply not used to it. More than likely it's the latter, I somehow can see large properties and their members never see or speak to a company owner, see...

Letting the customer dictate the payment terms?

This site keeps getting better and better.

Gee lets get in over our head, bid a job we have no clue how to propose, and tell the customer they can pay whenever they want..

No wonder while expenses are increasing every year, the price for service keeps going down.

Someone actually said to get a LOAN to support a late paying customer.....Thats the best right there.

Does anyone own a BUSINESS here? Or is this a hobby for everyone?

I know, and my initial take was to tell this association member to take a hike!
But I'm a solo owner-operator, and as such I refuse to be talked to like that.
I would've probably politely declined, said "well thanks but I'm not interested."

But see it's likely different for employee-based operations.
And I don't know the thread starter's size of operation, so I didn't want to come off sounding authoritative when in fact he might own a larger company well fit to tackle this type of mundane bs. And for them size companies this would be more than typical, probably all in a day's work for those employees.

As a rule I don't think an owner ever wants to deal directly with an association and its members, this is just the kind of stuff a larger outfit with managers and secretaries can deal with... This way the bs gets filtered three times over before it gets to the owner (if it even makes it that far), then it's not a big deal you just let the guys work it out amongst themselves, kinda.

For myself them associations are something else, it's bad enough with single owners / couples trying to find the few who respect us as business owners (vs. lawn 'boys'), but with an association some have 100+ members so there's no way we're ever going to get one with all members of one mind.

Hence I was thinking these types of places are more used to dealing with contract managers and maybe supervisors or secretaries, and so perhaps if an owner has to go look at a contract for the purpose of setting a bid then maybe it's more than this particular company can chew, reasonably.

For myself I would skip on it, but more so because a solo Lco has no place fooling with association-owned property contracts.
But I'm also beyond telling other Lco's what to do, just for myself, I'm not perfect.

PROCUT1
03-01-2008, 05:03 PM
For myself I would skip on it, but more so because a solo Lco has no place fooling with association-owned property contracts.

You said the magic words here. And include 99% of the people who are on this board asking how to bid this type of work.

thefed
03-01-2008, 07:39 PM
PROCUT: Thanks for your introspection....like most of the other threads you chime in on, your comment was truly helpful

captn
03-02-2008, 12:49 AM
Procut, the difference is that utilities and banks got you buy the shorties. This service industry is small business owners who don't have the monopoly and may need to use payment terms as a nogotiable item to ensure the competition isn't getting the deal by undercutting the bid, which is easy for newcomers to do.

By negotiationg the payment term rather than price, you get to win the bid at your price, and make sure fly-by-night part timers don't muzzle in on your territory. Again, I've played this from the other side of the table, and commercial accounts are looking for more strategic partnership reliablility, rather than a cheap cut and Maintenance. They don't want to spend their time re-negotiating this in a few months -- they would rather deal, pay, and forget about you.

thefed
03-02-2008, 08:22 AM
Procut, the difference is that utilities and banks got you buy the shorties. This service industry is small business owners who don't have the monopoly and may need to use payment terms as a nogotiable item to ensure the competition isn't getting the deal by undercutting the bid, which is easy for newcomers to do.

By negotiationg the payment term rather than price, you get to win the bid at your price, and make sure fly-by-night part timers don't muzzle in on your territory. Again, I've played this from the other side of the table, and commercial accounts are looking for more strategic partnership reliablility, rather than a cheap cut and Maintenance. They don't want to spend their time re-negotiating this in a few months -- they would rather deal, pay, and forget about you.

finally someone has some sense! well put

lawnman_scott
03-02-2008, 08:53 AM
Procut, the difference is that utilities and banks got you buy the shorties. This service industry is small business owners who don't have the monopoly and may need to use payment terms as a nogotiable item to ensure the competition isn't getting the deal by undercutting the bid, which is easy for newcomers to do.

By negotiationg the payment term rather than price, you get to win the bid at your price, and make sure fly-by-night part timers don't muzzle in on your territory. Again, I've played this from the other side of the table, and commercial accounts are looking for more strategic partnership reliablility, rather than a cheap cut and Maintenance. They don't want to spend their time re-negotiating this in a few months -- they would rather deal, pay, and forget about you.You stated before that a discount on early pay would pay for your office expence. So a 60 day no intrest loan, and paid office expence is what you expect just because your dealing with a small business? And now we can be pleased to find out you have joined the club?????? Great. Procut was right, everyone wants the big commercial accounts from day one so they can boost their ego, so much so that they dont even realize they have no idea what they are doing. And the management personel that hire them dont either.

JustCut
03-02-2008, 09:42 AM
I made a deal with my banker a long time ago. I wouldn't lend money and he wouldn't mow lawns.:usflag:
Also giving a discount to get the job, waiting for your money while it could be earning interest. I think a better us of our time and money would be going after accounts that understand that professionals give results that far out way the poor service they might recieve.

LB1234
03-02-2008, 10:23 AM
Well put PROCUT, your 100% on the ball...the problem is it seems no one listens on this site...

I still can not figure out for the life of me why someone would wait two freakin months to get paid. Well the one arguement was you'll have money coming in when you are not working. Fine, I'll give you that one...

However...as a personal example of one of our commercial properties...

In march we do the following:
(1) fert/pre emergent apps
(2) Spring Cleanup...weeding, pruning, removing winter annuals, installing spring annuals, cutting back perennials
(3) Mulch Install...includes mulch and edging of beds...about 23 cu.yds
(4) Lawn maintenance

In April we do the following:
(1) Fert/Broadleaf weed control
(2) Landscape bed mainteance
(3) Lawn Mainteance.

I just looked it up, between march and april we did $4,363.00 worth of work...So, how do I recoup those costs over the first two months? Actually now that I think about it, if my bill goes out March 31st first payment technically isn't due until end of may....that's actually 90 days of work before a payment. Great even worse!!

I JUST DON'T GET IT!!!!!!

brad329
03-02-2008, 11:11 AM
A Few Of My Commercial Accounts Do The Same Thing And I Knew That Before I Bid So I Just Added The 2% To My Bid.

captn
03-02-2008, 11:24 AM
You stated before that a discount on early pay would pay for your office expence. So a 60 day no intrest loan, and paid office expence is what you expect just because your dealing with a small business? And now we can be pleased to find out you have joined the club?????? Great. Procut was right, everyone wants the big commercial accounts from day one so they can boost their ego, so much so that they dont even realize they have no idea what they are doing. And the management personel that hire them dont either.

Lawnman, the bidder says he's got the capital to agree to the terms so why not use it as a negotiable item? I didn't say I expected the 60 term payment, but I'm willing to ask because small business owners are fighting competition on many other levels banks and utilities don't.

I agree that you should try to set your own terms, but somebody has got to cut that grass. Successful businesses focus on sustainable annual growth year over year, not monthly payday checks.

I'm not arguing, I'm trying to understand how business rules I use in other companies apply to Lawn Care since I am fairly new to this.

PROCUT1
03-02-2008, 11:41 AM
This is a subject that will be learned by these guys.

Im speaking from experience because everything I say about this topic, I have done.

When youre a small operator maybe with a couple employees and a truck and trailer you keep in your driveway, waiting for the "big check" isnt so hard. Your costs to carry the property are relatively low and when the money does come its a big windfall.

Now go and take on 10 of these properties. Move into a shop, hire office staff, salary managers, a night mechanic, additional trucks and equipment, additional insurance, add all the expenses of having an "business location" and you will see how important getting paid is.

When youre a small operator the profits seem huge in this business. If youre used to mowing lawns and getting those $150 checks every month, all of a sudden you start getting a check for one property for $4,000 a month, you think you hit the lottery and dont want to lose that.

Well as you grow that $4000 check doesnt go as far. Profit margins are not nearly what they are for the small guy.

This is not knocking the small guy, if he can do one or two HOAs and stay that size, he can make a nice living and can wait 2 months for his money.

Now grow and take 10 of these properties.

Have a crew of 12 guys

3 trucks, trailers, and equipment

An office person and all the overhead bills i mentioned

All ten of these properties need spring cleanups

100 yards of mulch installed on each in the spring

12 lawn cuts on each

Early and late spring lawn treatments.

All before you get your first check for the first month, 60 days later. Which is actually after 3 months of work you get your first check for the first month.

You have to pay your employees for those 12 weeks every week

The mulch supplier doesnt have 90 day terms

3 months of shop rent, utiilites and overhead have to be paid first.

Gas, repairs, equipment/truck payments....None have 90 day terms.

Once you get to this point you will realize how detrimental it is to provide these places with 3 month no interest loans.

This is something that you will learn real quick.

They pay "how they pay" because people like the ones on this board allow themselves to get pushed around.


The big companies in this business do not accept getting paid whenever.

My point is try approaching these commercial accounts like an equal.....Not on your knees begging for the privlege to work for them.

My business is 100% commercial. Landscape maintenance is one portion of the services that we provide but we deal with hundreds of commercial accounts for various work.

Before we sign a contract, the first thing I discuss is payment terms.

I will not tolerate late payments.

The point is you can get paid on time if you want to. I have never lost a customer by asking them to pay me.

lawnman_scott
03-02-2008, 12:34 PM
I'm not arguing, I'm trying to understand how business rules I use in other companies apply to Lawn Care since I am fairly new to this.I understand that. I am just on the side that wants to convince a new guy that that is not "the way it is".

lawnman_scott
03-02-2008, 12:35 PM
The point is you can get paid on time if you want to. I have never lost a customer by asking them to pay me.
This says it all.

topsites
03-02-2008, 01:18 PM
Well as you grow that $4000 check doesnt go as far. Profit margins are not nearly what they are for the small guy.

No but it's not just that, you are correct but it's also one stupid HOA can bust a small company right up the wazoo. Like you said that 4g sounds like millions and small Lco's are too easily blinded by the bling it is hard to see through that...

There is truth to the saying that greed blinds the judgment.

Guys like myself, I literally lose sight of what is going on, shove that kind of money in my face and I'm something like 10 times more likely to make a blunder.

And I hate to say it but customers are not looking out for us here, they're usually looking out for themselves, can't say I blame them. But in that process it is quite possible one or the other shoves bling in my face exactly because doing so might cause me to make a blunder! I'm not saying they all do it for that reason, and I wouldn't go so far as to point this out to anyone, but I would say "I am sorry but as a small operation I have no room fooling with that size of a job."

They are not stupid, customers can be a lot of things but stupid is almost never one of them.
Despite how smart we think we are, despite the fact that every year I think I get better, customers roll right with the punches. They adapt, they overcome, and with surprising speed... It's not so much about the war, it's more about making it work out between the both of us, but in the end sometimes it really does feel like a fight and in that sense you really can't win, best we can do is hope to break even.

So in terms of finances, a 40-50 dollar mistake frustrates me, a 200 dollar mistake is doable and a 1000 dollar mistake hurts, bad. But a 6 or 8 or 10 thousand dollar mistake would as likely wipe a solo operator right off the map.

It becomes relative, but in terms of a challenge either I'm up to it, or I'm not.
Never mind the fact, I did say residential accounts are sweetie pies in comparison to commercial HOA's, but I never said home owners were easy! No sir, a home owner can take any one of us to the cleaners, but since it's more direct than when an HOA does it as a whole, it's not AS brutal (but they'll still stick it to you).

Oh yes sir residential lots can bury the new Lco and they do, every day.
And those are the nice guys, that's what kills me here.

But every year it's this same thing again, this isn't the first time this has been mentioned, the warnings are in the archives left and right. Gets to a point I get tired of repeating myself.

topsites
03-02-2008, 01:28 PM
Oh yeah that's the other thing, customer wants to state their payment terms they can do that all they want. If I'm submitting a bid the payment terms are included in the contract, and like it or not if they sign that contract they are on my terms.

But I'd still steer clear of it, even with that knowledge, because I tried that mess.
And they tried to tell me, but I wouldn't listen (gee whaddaya know).
And I got burned, right good.

At least I had the sense to wait 5 years before I tried it, and it still hurt but it didn't put me out of business.
So at the very least you need 4-5 but 6-8 years in wouldn't hurt.

Trader Rick
03-02-2008, 10:10 PM
Why is this customer replacing the LCO from last season? Issues with billing? Late pmnt problems? The LCO dropped them like a rock?? You run your business the way you like. I would never go past net 30; especially as volatile as the economy is today. What are you going to do about the time this customer goes head deep in bankruptcy? Even H.O.As file bankruptcy at times.:usflag:

thefed
03-02-2008, 11:35 PM
Why is this customer replacing the LCO from last season? Issues with billing? Late pmnt problems? The LCO dropped them like a rock?? You run your business the way you like. I would never go past net 30; especially as volatile as the economy is today. What are you going to do about the time this customer goes head deep in bankruptcy? Even H.O.As file bankruptcy at times.:usflag:


Like I mentioned it's a good friend of a good friend who works there and has pull...so it seems it's a sure thing, but you never know....

crawdad
03-03-2008, 06:58 AM
Are you a Lawn Company, or a Loan Company?

AI Inc
03-03-2008, 07:12 AM
Made a deal with my banker, he will not service irrigation and I will not finance operations for commercial accounts.

CrimsonLawnCare
03-03-2008, 10:32 AM
from what i have heard most commerical companies around here will net you 90 days, which really sucks, but then at the end you get a big check

Cantona
03-03-2008, 10:33 AM
We have some very large accounts that pay us net 60 but it is a win win situation. These accounts provide over 500,000 in revenue...we are not the lowest bidder by any means on any of them. Part of the reason we win these bids is high service and quality but another reason is that we allow them to pay when they please. We in turn dictate cost to a certian degree. It is an inconveinence to us yes but our structure an other means allow us to deal with it. These kind of accounts have other benefits when they want extras they never question the price...they do not question you when you see something on the property. Also over time we change some of the rules about payment where snow payment is to be received net 15 unless there is an unforseen circumstance, while maintenance stays net 60. To get to certian levels the rules change...It was rough when we first realized this and at a different time we would not have been able to handle all the extras associated with it. It took us a certian amount of risk to move up to the next level (revenue wise) but it was calculated and we decided to make the jump and it payed off.

LB1234
03-03-2008, 10:33 AM
Like I mentioned it's a good friend of a good friend who works there and has pull...so it seems it's a sure thing, but you never know....

I don't know about anyone else, but it seems as if the "friends & family" are willlling to scew you out of a buck more than the other customers were the relationship is truly just a customer...not a friendship or friend of a friend.


just my opinion and experience over the years.

PROCUT1
03-03-2008, 03:28 PM
I guess we will agree to disagree.

Ill take my payments ontime and you can loan money.

IN2MOWN
03-03-2008, 03:30 PM
60 days? 90 days?

Screw that.

I send out an invoice at the end of the month. They have 15 days to pay or a finance charge is added to the next months invoice. I dont care if they are a day late.

Next time you order a pizza or go shopping try to leave them a note that says you will be back in 60-90 days with the payment...

Albery's Lawn & Tractor
03-03-2008, 05:59 PM
You guys who keep making it sound like this is such a big deal, do any of you guys have large commercial accounts? If so, and yours pays quicker then 60 or 90, your lucky. Around here this is normal, some county work is 30 days but most are atleast 60 or 90. Its no big deal really, you just add on enough to make it up in the end. A small time LCO might not want to take on a job like this, but for a slightly larger company who is well established these can be some of the best accounts.

PROCUT1
03-03-2008, 10:07 PM
You guys who keep making it sound like this is such a big deal, do any of you guys have large commercial accounts? If so, and yours pays quicker then 60 or 90, your lucky. Around here this is normal, some county work is 30 days but most are atleast 60 or 90. Its no big deal really, you just add on enough to make it up in the end. A small time LCO might not want to take on a job like this, but for a slightly larger company who is well established these can be some of the best accounts.

Its "normal" because lawnboys feel inferior to real "businesses"

1MajorTom
03-03-2008, 10:11 PM
Its "normal" because lawnboys feel inferior to real "businesses"

You like to paint with a wide brush.

TScapes
03-04-2008, 08:53 AM
Larger commercial props tend to pay on Net 60 or Net 90 terms, simply because that is how their money flows. However, in my experience it is the opposite when it comes to someone paying them! They want it in 15 or 30. A lot of vendors won't work with these companies bc of their payment schedule, however when they do get steady vendors, it is almost a given that they will give you all the work you can handle and most of the time they won't even bid it out.

The way we work it is that maintenance is steadily 60-90, but any workorder we do on site is net thirty regardless. We have also tried to get mulching and annuals (our biggest costs) separated from the maintenance contract so we can get this on a 30 day payment schedule. Some props have ok'd it while others won't budge..