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Getting Paid

Getting payment for work performed is more than just submitting a bill. Your company needs to develop a managed system of credit extension and collections management.

Selective Bidding
1) When you sign a contract with an owner or a general contractor you are actually granting credit to the other party.

2) Consider the size of the job – can you maintain cash flow if you don’t get paid on time?

3) Confirm Financing – Does the owner actually have financing?

4) Beware of owners who start jobs without financing – People have been known to start large projects on the “hope” of getting money

5) Beware of contractors with a large amount of liens on their projects

Credit / History Check
1) Has this owner built before? Is there any history on this owner

2) Dunn and Bradstreet

3) Personal Credit Check

4) History of liens?

CSA www.netcsa.com Check 'em out here!

Pre-lien and Lien
1) Automatic pre-lien generated at time contract is signed

2) Start date noted in file

3) Automatic lien placement when payment is late

Establish System
1) Read contract for payment provisions – When are submissions due? To whom?

2) List provisions and get names, addresses and phone numbers of key people

3) Plan to get GC or owner approval for percentage BEFORE submission

4) Submit on time and to the proper party

5) Build tickler system

Confirm receipt of billing

30 day call	Letter
60 day call	Lien
Notice of intent to lien

Implementing a collections plan
1) Check on average collections time and calculate your historical averages

2) Track bill to pay cycles by contractor or owner

3) Establish a procedure to record all contract payment provisions and note them

4) Note who to call / terms/ and dates for each project

5) Build system to have field personnel report percentages of completion on time and coordinate with owner’s rep / contractor to agree upon percentages before submission of billing

6) Produce management report of all billings over 30 days

7) Tickler file all billings and make the following calls

10 days after submission ask if bill received and is it complete.
30 days call and ask for status of payment
45 days call and ask for payment – establish where payment is and WHEN it will be made
60 days call as above and request same information
60 + Notice of intent to lien
70 + Lien (note deadlines in statute)

We have lien forms you can download HERE.