Whoa!! Only pay every 45 days??

Discussion in 'Lawn Mowing' started by Pro-Cut Lawns, Jun 19, 2002.

  1. Pro-Cut Lawns

    Pro-Cut Lawns LawnSite Member
    Messages: 71

    I won a bid on a new commercial account this year. Turned in my quote, insurance certificate, W-9, and all required info. Mowed beginning first week of April and billed May One on 30 day net terms. Mowed the month of May, and billed June 1 on 30 day net terms. Still have received no payment. I called the local office yesterday (checks are cut in a main office out of state). He gets online and says he shows no record of the check being cut. Asks me if he mentioned when I got the bid that the company only makes payments every 45 days. I tell him thats a small detail he forgot to mention. I am ticked. It was 45 days Sat. By the time the check is cut and I receive it in the mail we are talking close to 60 days for payment. I told him my creditiors didnt give me 45 days to make my payments!!!

    Its a small account that pays good and certainly isnt going to keep me or my family from eating, but its the principle of the thing. It's a large nation wide company and they are telling me WHEN they will pay me!!!

    Just needed to vent. Do I need to let it go and finish out the seaon or drop the account?? I could use the time spent on the account to do other work (that pays on time) I am behind on and even pick up another account or two. I really don't want to loose any accounts but I am really ticked about the situation. Anyone else have any 45 day paying accounts??
  2. SIG

    SIG LawnSite Member
    Messages: 188

    I have had Goverment work that took 90 days to get paid. It's part of business in the 2000's. That is why you should always have reserves. It sucks but it is life.
  3. JB1

    JB1 LawnSite Fanatic
    Messages: 5,903

    we've got one that pays 90 days, we just charge accordingly.
  4. lawnstudent

    lawnstudent LawnSite Senior Member
    Messages: 472

    You have a signed contract that specifies net 30 days payment and a late payment penalty fee? Then charge them the penalty fee. If not, then shame on you. Close out the season and chaulk this one up to experience.

  5. Jimbo

    Jimbo LawnSite Bronze Member
    Messages: 1,093

    I have two customers who are like this (both Commercial accounts) on a per cut basis. One thing is for sure..they pay so late I'll have plenty of money coming in over the winter.

    Basically I bid high on these accounts and I have added to my 30 day terms "A 5% late payment penalty applies for payments received after 30 days from invoice date". Usually this does the job. If they pay late and don't pay me the penalty I will write it off at the end of the year.

    If you don't want to do the 5% late penalty, you could bid high and do a 5% discount. Usally they will take the discount and pay early. (I am not sure how to keep my books straight when doing it this way though).

    Good Luck!
  6. Brickman

    Brickman LawnSite Bronze Member
    Messages: 1,249

    Personally I would explain to them that THEY signed the contract for 30 days, and like you mentioned nobody gives you 45 days, so either pay or find a new lawn guy and then stick to it.
    Guys listen up, and gals. THE ONLY REASON THEY DO THIS IS TO MAKE MORE MONEY OFF OF YOUR MONEY. And there is no reason we should allow them to continue.
    It boils down to the old saying, money talks, B. S. walks.

    Let us know what you decide to do.
  7. kris

    kris LawnSite Bronze Member
    from nowhere
    Messages: 1,578

    It's not unusual to wait 60 days for money on commercial accounts. We bill at the start of each month .ei. May 1st for maintenance in May ...gives you head start on them;)
  8. Likestomow

    Likestomow LawnSite Senior Member
    Messages: 997

    This is not the only business that has delayed payments. Insurance agents typically have to wait 45-60 days from the time they submit an application until they receive their commission.

    You'll have to wait the 45-60 days for your first payment, but after that the rest of the checks should come every 30 days if you are submitting your invoices on time each month.
  9. cp

    cp LawnSite Senior Member
    Messages: 263

    Maybe I am lucky but I got this new commercial account that is an industrial plant with a main office in New jersey. They wanted to be billed monthly for work done, so I bill monthly on the last week of the month and I have a check on the 10th every month, never late, no questions asked...:D
  10. Albemarle Lawn

    Albemarle Lawn LawnSite Bronze Member
    Messages: 1,544

    You can expect it with commercial accounts.

    Eventually, you will lose big time when one of them files bankruptcy or reorganization. You are last to be paid, think about it, electric bill gets paid first for obvious reasons.

    Price it in. Charge WAY more than you normally would.

    This is a HUGE P.I.T.A. factor increase.


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