Morning guys, I hope you're all doing doing good. It's a quick one on the
payment terms template. A load of years have been in touch about the template
which I mentioned on going out alone. I've been promising to upload this to the
group for a while into the file so I'm gonna do that now. I had to just do a
bit of editing and get get all my business logo and all that sort of
stuff off. I've just not had the time to do it but I've messed about of it last
night and I'm gonna fire it up there this morning but I'm also gonna start
chucking on some of the blogs blog posts just so they're more easily accessible
so you can just download them straight to your phone rather than have to be online
and searching through the announcements to find all the blogs. So I'm gonna try
and sort of copy and paste all the blogs onto the files and also I'll get the
payment terms set up. So in going out alone there's a chapter in there
called Who Sets the Payment Terms which I wrote about and it's based on my
experiences working as a domestic plasterer and so that's not so much
talking about the commercial stuff or even working for trusted builders. It's
more focusing on the domestic side of things so you're doing lots and lots of
smaller jobs and it's about taking control of how and when you get paid
really. I know it's a bit of a taboo topic taking deposits and I know a lot
of guys have the philosophy of you don't pay a penny until you're completely
happy with the job and they that's how they operate. I respect that I appreciate
and that's how a lot of yous work and that works for you and that's fine
but if it doesn't work in my case it didn't that didn't work because my view
is just based on experience it's always better to separate your business
operations in terms of money and your personal life and what I was doing is I
was using my own cash my own savings to cash flow jobs and to I was almost
becoming like a credit facility for for my customers and when you've got a
couple of landlords or whatever and you know it's all handshake kind of thing. I
ended up doing you know two or three hours is at one stage and getting owed
in quite a bit of money and which I weren't seeing. I did get the money in
the end but it was a number of months so I was using money that I needed to eat
and for my kids and to pay the mortgage I was using that money to cash flow and
to finance jobs and to pay my lads and again if you're running a smaller scale
or if you're doing you know lots of commercial work or you're doing stuff
for builders you can normally work something out with them in terms of how
when you get paid but if you're marketing as a small business in your
local area and you just get in random leads coming in you don't know who they
are and they're asking you to come and come and plaster their house. My angle is
you need to protect yourself remain professional provide a you know top
notch service and go the extra mile for the customers but at the same time you've
got to protect yourself and you've got a really you've got a state how and when
you're going to be paid so rather than just agreeing to their terms which is
what a lot of us do we sort of supply labour and materials we part with our
time sometimes we hire in help you know we've got the fuel and all the overhead
and we sort of shoulder all the risk we shoulder a hundred percent of the risk
and then we wait at the end of the job we wait you know we've crossed fingers
to get paid and hope that they pay us on time and most of the time they probably
will but there is that odd time where they won't and if it hasn't happened to
you yet because a lot of people so that's never happened to me you know
always been paid it will happen it's just a matter of time between some
people get caught out and you know they're Polly Polly up until the invoice
goes in and then you know they start ghosting you and it's like they've left
the country so we've all been there and say if they haven't been there yet it
will be there so the payment terms and to what what I personally do is I anything
over a grand I take 25% and then when I finished and completed and dusted down
cleaned up I hit them for this 75% so to me that's fair
it wouldn't be fair if it was 75 up front and 25 at the end but to me
25% yes a fair shout you know you shoulder in the risk you buy materials and
you you're taking that risk so it's a way of just booking in the job
and it's a way of weeding out non-payers and late-payers and also it's a good
tool to secure that job into your diary and there's been a few posts on trial
talk where people have been messed about late notice so the job's booked in
you might even have the materials ready to go in your lock up or in your van
and you get the text and I talk about this in going out alone as well where
this scenario happened to me so I just started getting into IWI and I bought
I think it was about 780 I know the amount because it pissed me off it's about 780 quid
100 mil sellatex which is the laminate board and that got banked into the garage
and this was due to start the next in the next couple of days and I got the text late on the
night before we due to start the job basically it was a short text it just said to
sorry to go EWI don't need you here tomorrow and I'll shoot I don't have a
work for this couple they're a lovely couple don't need you in our studio thanks again Emma
and I just remember thinking hang on a minute I've ordered this product in and it's it's
non-returnable because I ordered it through Baylars and they ordered it in for me and
they did say look it's non-returnable so I ended up getting stuck with you know 800 quids worth of
gear and no work and when that happened although I was able to eventually utilize these boards on
future work so a couple of months later luckily and I did have somewhere to store them but not
everybody has and so after that experience I decided I need to start really thinking about the
the booking terms and the the payment terms in my business and not just sort of be you go in with
the handshake philosophy oh yeah I'll do no worries I'll do that for you no problem so oh you want
that room doing as well yeah that's fine we'll skim that out for you no problem at all before you
know it you can end up you know a house and a half in the hole and you're owning you could be
owning five grand and you know you're paying your lads you're paying your suppliers you're paying your
fuel you've got so much overhead and you've got to pay also pay your personal costs your mortgage
you're paying for your kids and all the rest of it and you can end up hitting a wall so the cash flow
template the payment terms template is there just to protect you protect your small business and
another thing that it does that's good is it will double the speed of your cash flow so rather than
you starting a job that might take two or three weeks supplying everything and then getting paid
three weeks or a month later you're going to get paid twice you're going to get paid when you book
it in so as soon as you book a project in it you get them paid as soon as you complete you get them
paid so you end up your cash flow ends up doubling speed and it's brilliant so you've always got cash
trickling into the business rather than it coming in in you know fits and starts it's going to start
coming in at a regular pace so have a look at the template it might suit you it might not you might
be a bigger business you might do commercial work in which case this ain't you might be a big limited
company in which case this isn't going to really benefit you it's more for the sole trader and
you know the two to the one to two to three man setups like myself where you need that regular
weekly cash coming in to cover costs so I hope it's helped have a look I'll download some more of the
blog posts and if there's any other files that you guys want up on there well you've got any ideas of
stuff that could help members really including the apprentices and the young guys any files that you
think could help I'm not sure whether you can upload or if not ping them to me and I'll upload them
but have a good weekend and catch you soon cheers guys thank you