Cash Flow

Discussion in 'Hardscaping' started by SVA_Concrete, Mar 30, 2011.

  1. DVS Hardscaper

    DVS Hardscaper LawnSite Fanatic
    Posts: 6,405

    Agreed. This is pretty much another subject, but jobs over $7,000 I collect no less than 3 draws. I've had some larger jobs where there have been 7-10 draws. My mentality is that when we're done, the balance due is slightly more the cost of the turf restoration.

    I do NOT put ANY materials on account. When we work for you, the materials for your job are paid for on the spot. This is how I have done this for the last 7(?) years, I do not lay in bed worrying that I owe any suppliers any money. And it's a GREAT feeling!


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    Last edited: Mar 31, 2011
  2. PatriotLandscape

    PatriotLandscape LawnSite Bronze Member
    from MA
    Posts: 1,209

    We have an account with one vendor only because it was easier for them. I personally feel the same way as you and never want to be embarassed to pull in a yard that I owe 20k to. For some reason some guys just dont care to pay their bills.
     
  3. joes169

    joes169 LawnSite Member
    from WI
    Posts: 236

    Do you last two posters negotiate some kind of reduced rate for paying COD for your supplies? The reason I ask is because most all my suppliers offer at least 2%/10th, net 30.
     
  4. PerfectEarth

    PerfectEarth LawnSite Bronze Member
    Posts: 1,734

    Excellent take on this.
     
  5. SVA_Concrete

    SVA_Concrete LawnSite Senior Member
    Posts: 467

    same here.

    i use accounts for less paperwork and ease of accounting.

    it takes budgeting, but if you have the job figured for x dollars, i dont care if you pay it today or when the bill comes it is still x dollars, or in the case of 2%/10th it is x-2%
     
  6. mrusk

    mrusk LawnSite Gold Member
    Posts: 3,260

    Whenever I buy any materials, I make sure I am paying the cheapest price I can in North Jersey. EVERYTHING gets shopped around. I might talk every supplier down, but they get paid with a check on the spot for every order. I do not have any accounts anywhere.
     
  7. DVS Hardscaper

    DVS Hardscaper LawnSite Fanatic
    Posts: 6,405

    Everything in life is a two-way street.

    To each his own. I seldom shop around for your typical hardscape material.

    I'm huge on referals. Whether it's former clients or vendors.

    The vendor that gives me the most referals - is the vendor that I do the least haggeling with. And the vendor that gets the most business from me.

    We have a hardscape manufacturer / supplier in the area that most hardscape contractors do not buy from. Foolish on their part, but to each his own. I've known the staff at this place for the last 10 years. Most of the hardscape jobs we did in 2010 originated from this one particular supplier. We're like family. Because of our relationship, I respect them and I respect their prices. Most suppliers will give a home owner 3 contractors to call. This particular vendor usually only gives my name. We're pretty tight. Lets keep it that way.

    On the other hand we have a supplier in the area thats been in biz for over 50 years. Big company, big facility. We're the oldest hardscape company in the area and they have never given me any referals. They have never sat me down and asked "what can we do to get your business". Therefore I only buy small stuff from them once in every so bluemoons. Yet, when I go on there, they act like they can't understand WHY I don't buy from them. Last year we did a job 1 mile from their facility. I bought material from another supplier 20 miles away, even picked it up with my truck.

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  8. joes169

    joes169 LawnSite Member
    from WI
    Posts: 236


    That's all fine & dandy, and I respect that approach. BUT, I see no reasoning in that explanation why terms couldn't be laid out to your company's benefit while keeping the current relationship with your favored supplier.

    I'll give you an example of one of my recent supplier interactions. Keep in mind this is a different product, ready-mix concrete supplier, as well as completely different volume I would suspect.

    My terms are 2% by the 10th, net thirty. If I pour concrete on April 1, it's not due until May 31.

    This has zero negative impact on my contract pricing at all. As a matter of fact, merely paying my bill in a somewhat timely fashion instantly makes me an "outstanding customer" in their own words.

    They have a referral system in place as well. I never signed on to it as I didn't care for some of their restrictions. Always figured I'd go through the process IF I needed the extra work. They still send referrals my way regardless.

    And to top it all off, just 3 days ago I received my yearly pricing, and with minimal negotiation, I will be paying about 7% less than last years price for concrete. I can't just merely look beyond the decreased price, as it could easily equate to savings in the 5 figures for the year.

    And most importantly, this is my preferred supplier, one which I feel puts out the best product for our needs, and now they've aligned themselves as the cheapest as well.
     
  9. DVS Hardscaper

    DVS Hardscaper LawnSite Fanatic
    Posts: 6,405

    During the recession most suppliers have not increased prices, even though the manufacturers have. So, they been taking a cut on their profit. Pad me with referrals and our relationship will be luvie dovie. Being at the lowest price level is also a must.
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  10. joes169

    joes169 LawnSite Member
    from WI
    Posts: 236

    So what's the downside to having terms extended to the contractor?
     

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