60 to 80 % of my work is for customers who own 500,000 SF or more of 100
year old + properties or well established institutions.  Most of the work is
sequenced and designed in great detail before work begins and has been
planned for a 1 to 5 year period.  My company disperses all payments to
contractors on behalf of the owner.  All contracts contain a payment
schedule with a five day payment penalty to the owner and "time is of the
essence" and labor substitution bill back to the contractor.  Often all the
checks are cut before the start of the job post dated to match the
contractual payment dates.  In other cases accounting cuts checks on their
regular cycle to meet planned payments.
How this works is due to pre-planning so that the owner's cash flow meets
the program needs of the project.  The client must be convinced of three
things:  1)  the typical adversarial relationship between architect,
contractor and owner costs money that will not be spent on bricks and
mortar, 2) The goals of all three should be the same and agreed upon
(minimally all want to make a profit - better to face this realty up front)
and 3)  contractors tend to cut corners if they are paying for the job out
of their own pockets, ibid, quick payment results in better value.

As trite as it sounds:  In the end the best way to get paid is to "get
along" with each other, which usually means communicating honestly and
regularly from beginning to end.

Leland
-----Original Message-----
From: Michael P. Edison <[log in to unmask]>
To: [log in to unmask]
<[log in to unmask]>
Date: Tuesday, April 14, 1998 7:42 PM
Subject: Terms & Payments


Too few of us have the confidence it takes to risk irritating a customer by
stopping work or withholding further shipments, or whatever it takes to get
someone's attention. As for mechanics liens, they can be very effective in
certain states if the property owner is more substantial than a paper shell
designed to shield him from creditors.

I've never regretted any decision - however hard it seemed at the time - to
stop and insist on payment before proceeding. The only ones who scream are
the ones who were planning on cheating you in the first place.

Mike Edison