works agreement/contract

[Handyandy1969]

Hi Can anybody help, I helped my farther start a locksmith business 30 years ago, but I only got involved when he was on holiday or needed help. I took the business over two years ago and am expanding out of small town that he/we used to operate in. In our home town things were done on trust and goodwill, but now I am experiencing devious people that want to forget about your invoices etc.. I am also being forced to ask people to sign saying they are happy to wave their 7 day cancellation rights! therefore I need an agreement that covers all eventualities, has anybody got any pointers where I can buy this sort of contract/agreement?

EDIT: Moved to Running A Business forum.

[billdeserthills]

I think what could be a big help for your business would be a "mechanic's lien" I used to have the same trouble, when I first took over my Dad's company also. The hard part is to find the correct paperwork as there are hundreds of different lien forms out there and unfortunately the courts don't seem to like to help the little guy out much. One thing I learned is to add into your lien form that you will be charging 1 1/2% interest per month, which comes out to 18% per year, not bad money and it looks fairly scary to the deadbeat clients. You might be able to get some help from the Secretary of State for the state in which you reside

I also began my own program of revenge, for folks who refused to pay, but let's not talk about that here

[cledry]

Send estimates for any jobs of any size, get the estimate signed and also have them print their name. Always get a signature on the invoice when the work is finished and again have them print their name. Have the terms of payment or credit extended on the invoice near where they sign. For car openings, house openings etc. we won't go unless we get a credit card up front. We run the card and issue a refund if they cancel but if they just disappear we run the trip charge. If you work for a company that you aren't familiar with you can tell them payment will be required when the services are rendered. I don't do this with established firms or regular accounts. Make sure you can provide W-9 and Insurance Riders when customers require it. Get a 50% deposit on parts if they are expensive or something you normally wouldn't be able to sell, again don't do this with your regular customers.

[billdeserthills]

I forgot to say I also had a couple of stamps made up that I stamp all open account charge sale invoices with, they say:
CHARGE SALES ARE DUE 30 DAYS FROM
DATE ON INVOICE - PAYMENTS NOT
RECEIVED IN THAT TIME WILL BE
CHARGED A $25 LATE FEE PLUS A
2% MONTHLY INTEREST CHARGE

I have lost one or two accounts, due to the stamp. I stamp it on the invoice in two places, room permitting and then I ask the person requesting the work to sign. One job was a school & they didn't pay me until after the summer break was over. They called and asked if I would insist on the terms the stamp said? I told them it was not a joke and that they had requested the work & signed the stamped invoice and as it was now 5 months later, Yes I wanted to be paid. They paid me in full and never called me again--Goodbuy to those--type clients, let the competition have them!


Right after my Dad retired he handed me a box of years old invoices and asked me to collect on them
What a Dick he was, to do that to me! Here I had never done any of this work & I didn't even know much
about it at the time & I was supposed to make calls to collect for him, which I did--He never gave me a cent
of the money I recovered for him, boy he sure was right about forming a partnership, I'm soo glad I never did

[blue60]

Right after my Dad retired he handed me a box of years old invoices and asked me to collect on them
What a Dick he was, to do that to me! Here I had never done any of this work & I didn't even know much
about it at the time & I was supposed to make calls to collect for him, which I did--He never gave me a cent
of the money I recovered for him, boy he sure was right about forming a partnership, I'm soo glad I never did

that money was yours... he retired, you were running the company, that money was company funds on the book.... Just saying.

FYI. my dad tried something like that and I called a lawyer friend

[billdeserthills]

Right after my Dad retired he handed me a box of years old invoices and asked me to collect on them
What a Dick he was, to do that to me! Here I had never done any of this work & I didn't even know much
about it at the time & I was supposed to make calls to collect for him, which I did--He never gave me a cent
of the money I recovered for him, boy he sure was right about forming a partnership, I'm soo glad I never did

that money was yours... he retired, you were running the company, that money was company funds on the book.... Just saying.

FYI. my dad tried something like that and I called a lawyer friend

Thanks blue60,
It wound up being less than $1,000 and I am glad I turned it over to him, really. Heck Man, I was a cook for 12 years before I started working with my Dad, his "school of hard knocks" paved the way for the easy pickings
I have had for the last 20+ years. He was always telling me that I needed to learn "the discipline of work" I hope I never do though! He used to start at 8:30 am and work till 5 pm. I start at 10am and work 45 minutes in the shop, then go do a couple of service calls & go home. I could never support myself on a couple hours of work a day, like I do as a locksmith

[Sinifar]

I am not sure you want to hear this but here goes....

From 1040 - Schedule C, line 2, Returns and allowances. Take your unpaid invoices, total them up and take them off your gross receipts as a write off. Then post at all phones the deadbeat list. Never take work from them again.

You could also try small claims courts, if the amount is less than $5000 around here you can do it yourself,and just file the thing and then get a claim on the deadbeat. Collecting may be a problem, but at least you got a judgement. File a mechanics lien on the property. You would be surprised how fast you get paid when you file the lien at the courthouse.

There will always be those who feel that for whatever reason they don't have to pay you. Trust me, after 43 years + in this business we have had some real interesting problems. But the solutions are easy if you just think outside of the collect box, and charge them off on your taxes.

There are similar "Returns and Allowances" boxes on all federal and state tax forms. Just use the form which applies to your type of business organization.

Not to give accounting advise, you should have had some of that if you are keeping your own books anyway, and if you are using an outside accounting agency, they should know about how to write stuff off. Get them to just do it, and move on. Life is too short to constantly worry about your unpaid receivables.

YES it is tax time again! Go for it!

Sinifar

[deralian]

There will always be businesses that wait months to send you a check and require multiple "reminder" phone calls. Unfortunately these are usually the ones that enter you into their database and give you several jobs. So.... you just have to deal with it and keep calling until corporate finally pays up. Not sure how many of them would accept being billed a 'late' payment charge.

[billdeserthills]

There will always be businesses that wait months to send you a check and require multiple "reminder" phone calls. Unfortunately these are usually the ones that enter you into their database and give you several jobs. So.... you just have to deal with it and keep calling until corporate finally pays up. Not sure how many of them would accept being billed a 'late' payment charge.

I can tell you how many will do business with You after paying the interest charges
NONE

Thing is I would rather spend the hour I worked at a late/ no payer job sitting at home watching TV or conversing with youse guys. When I charge the interest I'm really just saying "Goodbye, try not to let the door hit you in the @ss on your way out" because I won't tolerate that behaviour, not from an adult. I already have watched a couple of my late/no pay companies go under, and the late thing--To me at least is the first sign
that this business is in trouble.
Besides, there are plenty of fly-by night companies around & this kinda biz is prolly their bread & butter!

[cj101]

Also I am no locksmith but in a different business, heres my advice.
Here in Germany, we usually give a small discount of 1 to 3 percents for all costumers paying cash or very fast. For most companies this is a sufficient reason to pay fast.
If a company pays late, it might be an indication that they have some financial troubles (especially, when they paid in time before). You should consider having them to pay a security deposit before large orders.
Charging a late payment fee is, however, a guaranted method, to loose this costumer once and for all. So consider this wisely. For large costumers, where you expect other orders as well, I wojld not charge zuch fees. Even a large stamp telling this is not building up a good costumer relationship. In germany, however, it is already part of the law, that you may charge such fees if they are late with pament and you send them a reminder with a suitable payment date. Maybe you have already such laws, too.
Furthermore each bill of me states, that the goods I sold remain in my possesion until fully paid, which gives you the possibility to get your stuff back if your company declares bankcrupty (with some exceptions). However, this may be different in the statss.

[dll932]

When I worked as a 'smith for a lock shop I introduced an idea: If you end up installing hardware the customer already HAS, put down on the invoice that you are only responsible for the quality of the work, hardware warranties are to be taken up with the maker of the lock.

[sentientsentinel]

You follow the universal commercial code commonly known as the UCC.Send a one bill usually ignored and not disputed send the second bill the same reaction third time send a default notice.Its better if everything is certified but regular mail will work except for tort letter.You now have evidence that there was an agreement and its unpaid now you can just file in small claims court or civil court if the amount is too high for small claims.The other thing you can do is file a mechanics lien if the house is financially encumbered or they want to sell the house this makes a big mess for them it clouds the title generally the bank will call them and tell them to get the cloud off the title or they will do something nasty to them or if they are selling it the Realtor will tell them to take care of the bill because it just looks like a dishonest thing to do.That said for me I prefer the billing twice then a default notice then for sure send certified letter return receipt requested listing the dates of all previous letters and there intent then add a tort letter which just says" I have been harmed and demand to be made whole" then tell them why you've been harmed give them ten business days to respond.If they don't respond or they do respond with a defense sue them you now have everything you need for a pretty rock solid civil case.If you choose the lien route it could be 20 years before the house is sold (generally not but possible)and you get paid from proceeds from sale.