SPRAYFOAM Professional - Winter 2015 - (Page 43)
By maC sHELDon
aking money as a subcontractor is
as much an art as a science. Yes,
there are some iron-clad rules in business, but most of the long-term profit
generated and retained by a successful business owner is a result of artful
customer relations, artful labor management, artful money management and
careful attention to the craft.
Certainly the basic rules of business
must always be recognized and strictly
adhered-to such as timely payment of
your labor, taxes, supplier, all of your
other creditors and your growth fund
before you pay yourself. We must also
collect receivables when due and complete jobs in a timely and workmanlike
manner. But it's not just what we do
but how we do them that makes all
If you've heard me speak, or read previous articles, you're familiar with my
basic tenet of the sprayfoam business:
>>Take Care of the Customer.
....In that order!
Some sprayfoam contractors tell me
they're inconsistent with invoicing and
have no regular schedule for sending
bills to the owner or general contractor.
You worked hard to get the material,
your spray rig and your crew to the job
and you did a fabulous job insulating
and air sealing the building - and now
you have a lot of your money invested in
your contractor's job. You deserve to be
paid according to your terms. So what's
your plan if a check for payment in full
doesn't arrive on time?
First examine your collections process. Did you send your invoice by the
date or day of the month the builder or
GC has set as their cutoff? Most GCs take
one draw every month from their line of
credit or from the owner and only pay
the bills submitted by their cutoff date.
How do you know? You ask, of course!
Communication is the key and it's an art
not understood by all subcontractors.
The time to ask about the GC's payment schedule is when the proposal is
presented. Whether it's presented face
to face (by far the preferred method) or
by mail or email, the question should
always be asked and the answer committed to writing. Here's an example:
"OK then, we'll be out on the 14th
to spray your project and we estimate
it will take two full days. Please make
sure there are no other trades scheduled for the days we're working since
we can't spray if others are present.
We'll send our invoice on completion,
so would email or postal mail be more
convenient for you?" Write their preference on your proposal then go on to
ask about the GC's payment schedule.
"Do you cut checks on a particular day
of the month? And, do you have a cutoff day so you can get your payments
processed?" Crafting your questions so
they're non-aggressive yet collect the
needed information in a friendly and
business-like manner is a key element
in the art of getting paid.
If you weren't able to meet with
your customer to present the proposal,
I would call them to thank them for their
order and ask about the terms over the
phone. I'd offer my telephone and email
and encourage communication if you
can assist in any way. Next, I'd follow
the call or email with a hand-written
note of thanks and a second copy of your
proposal with the terms you agreed to
over the phone.
Conversely, some sprayfoam contractors manage their billing by sending the
invoice and waiting. If they don't get
paid when they think they should, they
might call and cuss out the GC or leave
a terse or threatening voice mail. I'm a
fan of talking about the debt before it's
incurred and following up with written
communication. In good times like we
are enjoying in many parts of the country
right now, the poor communicator might
still get work, but when (not if) we have
another downturn in building, the communicator will likely stay afloat provided
he artfully manages his business.
The same principles can be applied
to labor management. Craft your commitment questions for your workers to help them understand
the importance of
getting the work
done on time
and to your high
lead the crew
| sprayfoam Professional 43
Table of Contents for the Digital Edition of SPRAYFOAM Professional - Winter 2015
EXECUTIVE DIRECTOR’S CORNER
FOAM BUSINESS NEWS
Sprayfoam 2016 Convention & Expo – February 8-11, 2016
SPFA’s History Proves Our Perseverance
SPF Research on Air Quality – PART 1
2015 SPFA CONTRACTOR AWARDS
MAKING MONEY: Paint Your Own Picture of Success
ASK THE EXPERT
INDEX OF ADVERTISERS
SPRAYFOAM Professional - Winter 2015