How It All Went Bad

[Team-Green L&L]

I have to share this story for those out there that are like me and don't have a ton of cashflow to protect their assets.

I did a job this year that sold at 14,200.00 in April. We completed the job and received final payment in our industries most common form of payment, a check.

I deposited the check and moved on to the next job. This job had $6300.00 in material costs and had a good profit margin. Unfortunately it rained on the site for 3 days and delayed excavation and grading.

So, I get a call from my banker saying that they took $8900 out of my account because the check bounced. Now because it was too early in the season to have my account built up yet, the second job was delayed, and this grease-ball just bounced me a check, I ended up with upset vendors from material purchases made before I got that phone call.

So, to make a long story short. I do not feel that an industry that thrives on competitive pricing, little regulations, fuel dependency and labor shortages, while adding the element of the least secure form of payment being the standard, to be a viable business for long term growth.

I paid all the checks off and spent all my profits of the season doing so and now I am trying to double-time to make up for a lost spring season all due to the "trust factor" that we carry from day to day in this business. I told this story to help someone else from making the same mistake.

Things I have done from a hard lesson learned:

1. Since checks ARE the standard in our business I got rid of the credit card machine and got a service that guarantees checks written to me when they authorize them.

2. Require a credit card guarantee on the contract to prevent recurrence.

3. Transferred our banking to a bank account that provides an "over-draft protection" amount that exceeds the highest valued check we have received in the past 12 months. This requires credit to do.

I would advise those who are venturing into the landscape construction field to consider the likely possibility of this happening. It was the first time it happened to us since 2001 (when we started), but has certainly rained on my parade this year.

[Charles]

You used to be able to ask the bank if a check was good before you deposited it. Now your protection is gone. At least that is what I found out a few years ago when I called a bank about a check. You can't even get a check cashed at the customers bank without having an account there--in most cases. Man, that would be a killer to have that big of a check bounce anytime of the year. Hope you called the police

[Scagguy]

Sorry to hear about your misfortune. I hope the scumbag that wrote you the check is sitting somewhere, rotting away in a jail cell. If not, I'd be inclined to see that he gets there and fast.

[customcurbdesigns]

Did you get the money back or no?

[Lawnworks]

I guess that is why you have need to have at LEAST one month of gross income in your checking account at all times. I don't know you would sleep at night if you don't. They say the number 1 reason small businesses fail is b/c of lack of capital.

[Mrs. H]

That's a lot of money...my stomach sank for you. :( We've had $100 to $150 checks bounced off us. If there is a question, David can usually go directly to the customers bank to cask...usually without a fee. I guess it must depend on the area, Charles, we've not had much problem with that.

That much money...our bank usually makes us wait 10 for clearance because we usually don't bring checks that large in. Waiting a few days for clearance regardless of the bank's policy is always a good idea.

[Chilehead]

You used to be able to ask the bank if a check was good before you deposited it. Now your protection is gone. At least that is what I found out a few years ago when I called a bank about a check. You can't even get a check cashed at the customers bank without having an account there--in most cases. Man, that would be a killer to have that big of a check bounce anytime of the year. Hope you called the police

I have likewise noticed that banks will not give you information over the phone pertaining to a check being solvent. Have NOT had the trouble yet of a bank not cashing one for me at the issuer's bank. Maybe I'm just lucky, or perhaps it depends on the bank--they all have different policies.

[zimmatic]

Here's a story for ya. I had the a "feeling" that a check I was issued wasnt any good. The check was written to my company. I went the bank on which the check was drawn. I convinced the teller to cash the check and issue a "cashiers check" back to my company. That way the check was in theory "cashed" and I recive a guarentee that the payment was good through the cashiers check. Now I havent had the same results from every bank or within branches. I think it depends on the day and person who I spoke to. I have only done this 2-3 times since I have been in business.

[Picasso]

Here's a story for ya. I had the a "feeling" that a check I was issued wasnt any good. The check was written to my company. I went the bank on which the check was drawn. I convinced the teller to cash the check and issue a "cashiers check" back to my company. That way the check was in theory "cashed" and I recive a guarentee that the payment was good through the cashiers check. Now I havent had the same results from every bank or within branches. I think it depends on the day and person who I spoke to. I have only done this 2-3 times since I have been in business.

i have done that a few times to. they arnt supose to do it but like you say sometimes you get the new girl that doesnt knowany better.

[PROCUT1]

Have had the problem in the past and sometimes now. I now structure all my payments that only 10% of the money is due after the job is done.

Im not in the landscape business anymore but commercial sealcoating and striping.

I take 50% deposit to schedule the job

20% is due after the cracksealing
20% after the sealcoating
10% after the line painting.

Now thats for jobs over 10k. Anything under 10k is usually only a few hour job so its 50% to schedule and 50% when we start the line painting.

Yes, sometimes it seems silly because the customer ends up giving us 3 separate checks only hours apart from eachother, but ive had a couple large jobs almost put me out of business in the past so im not going to do that again.

Right now im dealing with a job that i gave in on and took a 30% deposit with the remainder due on completion.

Job has been done for 3 weeks.....Im waiting on 30k.....Their response? "Everytime you call for the check, we will delay it longer"

Thats a great feeling to have and a great thing to hear after busting butt for 60 HOURS in 3 DAYS to get this job done in 100+ degree heat on the one weekend a year this business closes.

NEVER again.

I will gladly lose jobs over my payment requirements than to be in a pinch again.
30k is a huge amount of money to me.

[Team-Green L&L]

Thanks for all the empathy here. As of right now I have not received relief and the Prosecutor's Office said that it would take 6 months to prosecute the "Passing Bad Check" charge and that still did not guarantee payment to me. I have the option of "un-installing" the job because the contract clearly states that "all materials belong to TG until payment is made to satisfy all work and materials completed", but this guy filed a Temporary Restraining Order on me and my company (for what reasoning I am unsure of) and now I can't even do that. Not that I would want to anyway. That is more work than putting it in sometimes (and many times when we do it).

Lack of capital was our season's "big mistake". I chose to spend our start up capital on some much needed equipment and didn't plan for this at all. I hope we can all learn a lesson from my mistake. I am still working and will profit some this year, but it sure put a damper on my spirits and my relationships with vendors.

[landscaper22]

These high dollar landscape jobs do scare me. Generally, since I am a small operation, I am extremely careful about who I even do landscape installs for. I don't have any extra safeguards in place for bank priotection yet. However, most of the landscape jobs I get come from referrals. That in no way gives me a 100% guarantee, but it does ease my mind a little if someone I trust knows them and sends them to me. It really is all about gut feeling. If I meet with a customer and get that uneasy feeling, I will end up pricing myself out of the job. Or just tell them I am too busy. I also don't want to work for someone that is going to be difficult. Then the job can end up taking way more time than expected. I always price the jobs to make room for problems. Then, if everything goes really well I can give a break at the end.
I have not had any bounced checks yet (not in lawn maintenance or landscaping), and this is my 6the season in business. I will keep my fingers crossed. It is easier to take a chance on a $100-200 job. But when you get into the thousands, I can't take many chances with that.
Andrew, what happened when you contacted the customer? You didn't ever get your money? What about court or getting a lien? If nothing else, I don't know what kind of project you did, but if it was a landscape install I would have went and dug up my plantings and taken them with me. They are still yours because the customer never paid you for them.

Well you can ignore this post...You chimed back in and answered my questions before I posted this comment.....Best of luck, and keep fighting it until the end.

[PROCUT1]

Thanks for all the empathy here. As of right now I have not received relief and the Prosecutor's Office said that it would take 6 months to prosecute the "Passing Bad Check" charge and that still did not guarantee payment to me. I have the option of "un-installing" the job because the contract clearly states that "all materials belong to TG until payment is made to satisfy all work and materials completed", but this guy filed a Temporary Restraining Order on me and my company (for what reasoning I am unsure of) and now I can't even do that. Not that I would want to anyway. That is more work than putting it in sometimes (and many times when we do it).

Lack of capital was our season's "big mistake". I chose to spend our start up capital on some much needed equipment and didn't plan for this at all. I hope we can all learn a lesson from my mistake. I am still working and will profit some this year, but it sure put a damper on my spirits and my relationships with vendors.


I totally feel for ya pal. Been there. There is nothing worse than being your vendors number 1 customer one day and the next day they treat you like a freeloader. It can happen in an instant.

So many times you read on here about "payment terms" and how guys will gladly wait 60-90 days for money.

Well its not our job to bankroll people.

In the business im in now, im in uncharted waters. I went from sealcoating a few driveways to specializing in huge commercial properties almost overnight.

Im not going to try and put on a show to impress guys on here.....I DONT have the money to carry 4 or 5 jobs. 4 or 5 jobs can be over 100,000.

And my biggest question is "WHY SHOULD I?"

Everyone is so scared to collect money on here....They dont have a problem doing the work but they think the customer is going to be mad if they ask to be paid.

Or they dont want to come across like a "little guy that needs the money"

Well im not embarrassed to say I NEED THE MONEY!!!!!!

I deal with nothing but large corporations, large management compaines, hotel chains etc......

And I get them to pay on my terms.

Most times all you have to do is ask.

And after being down that road before....Im not afraid to talk money in the initial meeting.

[mgugliotti]

Folks-
Why are we still doing this? Why are we allowing our industry and our livelihoods to be at the whim of our customers? I feel for all of you as I was in the same situation and almost lost my business because of it. I can't tell you how stressful it is, and I'm sure all of you who have been in the situation already know.

As for the guy that wrote the bad check, that is against the law, you can press charges against him, and you should! Why should your credit go to crap for doing a job that HE asked you to do; moreover, he knew how much it was going to cost before you started. Make him pay, press charges.

As for everything else, we have to make a commitment to ourselves and our industry and stop these customers from doing this, even the small stuff that Mrs. H is talking about. I have said it before, and I'm going to say it again, consider using SolidContract.com to see if your customer is good for the money before you work for them! OR, report them if they bag you. I'll be willing to bet that this is not the first time he has bounced a check on a contractor, or your customers Mrs. H. We all should know about that, we shouldn't give the opportunity to let that customer take advantage of some one else down the road, besides you may be the next guy they take advantage of.

SolidContract.com gives our industry the protection and unity that we so badly need. My goal is to make sure you get paid in full every time! The site is a fully legal site, so you naysayers can hold your comments... I had a team of lawyers work on this project with me for months... so yes it is legal.

The economy is turning South, now more than ever it is time to invest in your business and industry and protect yourself and others from these deadbeat customers. Check it out, let me know what you think, and ask questions if you have any, but let's put a stop customers taking advantage of us!!!!

Best of luck my friend.
Matt Gugliotti
President
www.Solidcontract.com

[landscaper22]

I never give landscape customers extra time to pay, nor do I act like I don't need the money. However, most of the time (take a sod install for instance), the same day I purchase the materials, I also complete the job. Sometimes it may be a little longer. I would never extend credit or act like a bank. I just do the job and collect my money. If I were to spend $5000 or more on materials, then I may ask for half of the total charge up front. But I can say that I have never paid anyone up front to do any contract work for me. I don't like that too much. Well, I have paid a contractor for materials before a job has been completed. But, the contractor purchased the materials, left them at my house and I then reimbursed them. I just will not ask anything of my customers that I do not feel comfortable with when I deal with contractors. Because many of them will take your money and you will be left with nothing.

[mgugliotti]

I never give landscape customers extra time to pay, nor do I act like I don't need the money. However, most of the time (take a sod install for instance), the same day I purchase the materials, I also complete the job. Sometimes it may be a little longer. I would never extend credit or act like a bank. I just do the job and collect my money. If I were to spend $5000 or more on materials, then I may ask for half of the total charge up front. But I can say that I have never paid anyone up front to do any contract work for me. I don't like that too much. Well, I have paid a contractor for materials before a job has been completed. But, the contractor purchased the materials, left them at my house and I then reimbursed them. I just will not ask anything of my customers that I do not feel comfortable with when I deal with contractors. Because many of them will take your money and you will be left with nothing.

interesting.... so you don't get any money up front? is that correct? i always get 50% down... but my jobs usually take a few days and most of them are at least 10k... do you feel you are open to a huge liability by not taking any money up front, if for instance they decide not to pay? The problem is once you put something on their property the law says they own it even if they didn't pay for it...

[landscaper22]

interesting.... so you don't get any money up front? is that correct? i always get 50% down... but my jobs usually take a few days and most of them are at least 10k... do you feel you are open to a huge liability by not taking any money up front, if for instance they decide not to pay? The problem is once you put something on their property the law says they own it even if they didn't pay for it...

I would think that law would vary by state, but I really don't know. I guess it is just one of those things. I usually don't collect any money up front. But I assure you, if I know I am getting the shaft, I will undo the work I have done. Against the law or not.
I may have to check into that law for my state. I just try to work out something that will make the customer comfortable. Most people would feel uneasy about writing a check for $5000 to a contractor that has not yet done any work, and has not brought any materials to the job. I know many people do. But I hear all the time on the local news about contractors that take the money and run. So far I have not had any problems.
Don't get me wrong, I am not against getting money up front. Maybe I am completely setting myself up for something bad one day. I will consider making some changes. But I look at it this way....Don't screw me over, I know where you live.

[Brianslawn]

You used to be able to ask the bank if a check was good before you deposited it. Now your protection is gone. At least that is what I found out a few years ago when I called a bank about a check. You can't even get a check cashed at the customers bank without having an account there--in most cases. Man, that would be a killer to have that big of a check bounce anytime of the year. Hope you called the police

the cops dont give a $h!t about the stooopid lawnboys. in many states that bounced check is not illegal and you can not prosecute. yes it is illegal to write a doctor a hot check after he sees you. it is illegal to write walmart a hot check when paying for your groceries. but it is perfectly legal to write the lawnboy a hot check after you receive his bill. many small claims courts have caps of $2000-$5000, so you will have to hire a lawyer and spend a couple grand going after a bad check over the small claims cap. many banks will still issue a cashieres check for your customers check if they have enough in their account. you have to go to the bank in which the check is drawn and some charge a fee. at least the banks around here do.

the standard for this industry may be a check, but the standard for us is not. we dont bill like lawnboys do. we bill like businesses do. i suggest you lawnboys look around and see how things are done outside the world of make believe. if you want customers to treat you like you are a real business, then start acting like you are one.

[mgugliotti]

the cops dont give a $h!t about the stooopid lawnboys. in many states that bounced check is not illegal and you can not prosecute. yes it is illegal to write a doctor a hot check after he sees you. it is illegal to write walmart a hot check when paying for your groceries. but it is perfectly legal to write the lawnboy a hot check after you receive his bill. many small claims courts have caps of $2000-$5000, so you will have to hire a lawyer and spend a couple grand going after a bad check over the small claims cap. many banks will still issue a cashieres check for your customers check if they have enough in their account. you have to go to the bank in which the check is drawn and some charge a fee. at least the banks around here do.

the standard for this industry may be a check, but the standard for us is not. we dont bill like lawnboys do. we bill like businesses do. i suggest you lawnboys look around and see how things are done outside the world of make believe. if you want customers to treat you like you are a real business, then start acting like you are one.

ok..... last time i check this is an educational forum... rather than mocking the people who have lost money due to old business practices, why don't you tell all of us what you consider "billing like a business" entails. Giving them the benefit of the doubt, I think most people are already doing that. In addition I think it is dangerous to make a blanket statement that all police jurisdictions don't care about our bounced checks, I know they do in my jurisdictions- so don't rule that out as an option folks. however, that is good advice to go back to the bank in which the check was written and see if they can give you a bank check. Again, don't forget to use options like Solidcontract.com to put a long term consequence on not paying your bill- for up to seven years.

Matt Gugliotti
President
www.Solidcontract.com

[Team-Green L&L]

the cops dont give a $h!t about the stooopid lawnboys. in many states that bounced check is not illegal and you can not prosecute. yes it is illegal to write a doctor a hot check after he sees you. it is illegal to write walmart a hot check when paying for your groceries. but it is perfectly legal to write the lawnboy a hot check after you receive his bill. many small claims courts have caps of $2000-$5000, so you will have to hire a lawyer and spend a couple grand going after a bad check over the small claims cap. many banks will still issue a cashieres check for your customers check if they have enough in their account. you have to go to the bank in which the check is drawn and some charge a fee. at least the banks around here do.

the standard for this industry may be a check, but the standard for us is not. we dont bill like lawnboys do. we bill like businesses do. i suggest you lawnboys look around and see how things are done outside the world of make believe. if you want customers to treat you like you are a real business, then start acting like you are one.

My friends, this is the type of post that screams out "I need a friend" ! If you are looking for some attention call your mother. If you are looking to impress someone with your legal knowledge you did a piss poor job of that.

Passing a Bad Check is always a crime (read some) (http://codes.ohio.gov/orc/2913.11) and I haven't been considered by anyone, with the exception of you I presume, to be a "lawn boy" in, well...EVER. I am a 30 year old multi-business owner (BA) who has been dealing with the same bull**** you do on a day-to-day basis for the past 8 years. I have wasted money and earned a ton of it, damaged my reputation and exalted it, and I have certainly trusted those that I shouldn't have. The one thing that happened every time though, was that I always learned something and got better at dealing with that issue. Isn't that what we really want to focus on in business...getting better.

I think I remember the greatest business man that lived, Dale Carnegie, once say, "If it were not for my blunders I would never have seen triumph staring me in the eye."

To patronize someone in a time of misfortune only furthers your malice and I truly believe that kharma, conviction, or whatever your Grandmother called that force I'm talking about, will deal with us individually for our wicked ways.

Oh yeah, and the difference between myself and your cute "lawn boy" insult is that a "lawn boy" uses daddy's equipment (or credit) to operate at a rate that defies value and lowers our industry standards as a whole. Please learn something BEFORE you get diarrhea of the mouth next time.

[Lawn-Sharks]

My friends, this is the type of post that screams out "I need a friend" ! If you are looking for some attention call your mother. If you are looking to impress someone with your legal knowledge you did a piss poor job of that.

Passing a Bad Check is always a crime (read some) (http://codes.ohio.gov/orc/2913.11) and I haven't been considered by anyone, with the exception of you I presume, to be a "lawn boy" in, well...EVER. I am a 30 year old multi-business owner (BA) who has been dealing with the same bull**** you do on a day-to-day basis for the past 8 years. I have wasted money and earned a ton of it, damaged my reputation and exalted it, and I have certainly trusted those that I shouldn't have. The one thing that happened every time though, was that I always learned something and got better at dealing with that issue. Isn't that what we really want to focus on in business...getting better.

I think I remember the greatest business man that lived, Dale Carnegie, once say, "If it were not for my blunders I would never have seen triumph staring me in the eye."

To patronize someone in a time of misfortune only furthers your malice and I truly believe that kharma, conviction, or whatever your Grandmother called that force I'm talking about, will deal with us individually for our wicked ways.

Oh yeah, and the difference between myself and your cute "lawn boy" insult is that a "lawn boy" uses daddy's equipment (or credit) to operate at a rate that defies value and lowers our industry standards as a whole. Please learn something BEFORE you get diarrhea of the mouth next time.

Well said brother!

[Brianslawn]

around here and in other areas im sure as well.... the check must be received at the time the purchase is made or services rendered for it to be considered illegal if it bounces. if you send them an invoice or go back later to get check... then it is not illegal if it bounces. im not the one that writes these dumbass laws. i just know what they are in my area. the last time you filled up with gas or bought something off the internet... did they mail you an invoice at the end of the month?

say hi to mr. rogers for me.

[k911lowe]

unless i know the customer i check to see if the check will clear by cashing it at their bank and depositing the cash.tough lesson to learn.time to break out the Louisville slugger.can you report him to the cops and get his ass (donkey)arrested.bouncing a check is illegal.worth going to court for fees also.

[mattfromNY]

I am sorry and glad you share your story with us. This time of year, when we are super busy and it is very easy to overlook a few details in our estimates, this is a good reminder to us that we should step back, take a deep breath and make sure our T's are crossed and I's are dotted if we are to survive in this (or any) business.
Hope it turns out for the better for you, hope it never happens again. Keep your head up and keep us up on the progress of your case.
Matt