Getting Paid
This article was originally published in the National Association of Homebuilders online magazine, NBN OnLine, in April, 2006. For more of Tim’s short, construction-related stories check out Cracks, Sags, and Dimwits - Lessons to Build On.
By T.K. Garrison
The Builder’s Engineer ™
All rights reserved.
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When I moved to the mountainside acreage that is now my family’s home seven years ago, the first order of business was to have a well drilled. I called my favorite driller and soon the lumbering equipment was on site hammering away. At 200 feet deep the “well” was producing about a quart an hour-not enough for a toad in a mud puddle let alone a family of four.
With hard rock drilling, like at my place, generally the deeper you go, the less probability you have of hitting a water-bearing fracture. Also, in my neck of the woods, the deeper rock formations are old marine deposits and commonly contain salt water; which isn’t good for you, cakes up your pipes, and tastes like anchovies.
So, rather than continue spending $30 per foot on my new Sahara-Desert-In-A-Hole, I sucked up my losses and had the drillers pull out. My ten-year-old son, who was looking on with great interest, came charging up and croaked, “Dad, I’m thirsty.”
Not being in a very good mood, I seized the opportunity to bark at my forlorn wife and two small children, who were now gathered around me with drooping eyes and sunken cheeks, that they would just have to learn to do without water. That we were going on a water-weaning program.
After a few minutes of crying, blubbering, and good old-fashioned wailing, I forced a smile and admitted that, of course, I was joshing. I went on to explain that I didn’t want to connect to the public water main at the beginning of our driveway but now would have to.
To add a little more insult, on his way out, Hank, the chief driller, handed me an invoice for $6,498. I was stunned. How was this possible? You can’t possibly calculate and print an invoice-on company letterhead no less-within five minutes of the work being done! I was chagrined to discover that he had a laptop computer and a cigarette-lighter-powered-printer right there in the cab of his rig.
“Any chance you can pay this now?” Hank asked firmly.
“Ehm… no,” I stammered. “I don’t have my checkbook with me.”
“We like getting paid right away,” Hank said. “Any chance you could drop a check by our office tomorrow?”
“I’ll see what I can do.”
At 8:01 the next morning my phone rang. “Is this Mister Garrison?” the gal’s voice inquired in a tone not too unlike that of a drill sergeant.
“Yes?”
“Mister Garrison, sir, this is Mergatroid Crowbar from Hank’s drilling. Would you, sir, be able to pay our invoice today? I could swing by and pick up the check if you were unable to drive by our office.”
“Um, sure,” I faltered, completely taken off guard. “You folks certainly are aggressive when it comes to money, heh, heh.”
“Yes we are, sir. I’ll be over in approximately 21 minutes, if that’s okay with you, sir.”
“Unh, yeah… yeah, that’ll be fine. I sure hope you’ve had some breakfast, though, Mergatroid,” I joked. “Wouldn’t want to lose any fingers when I hand over the check. Haw haw.”
“Yes, I’ve eaten my breakfast, sir. You are a funny man. See you in 20 minutes.”
And so I shelled out big bucks for my brand new, 200-foot posthole. They may not be good at finding water, but Hank’s Drilling is very good at collecting payment. Here’s how they do it:
Hank personally goes over the scope of work and the costs beforehand. When I initially called Hank, he personally came to my site and walked it with me, explaining in detail the basics of hard rock drilling. He discussed the probability of hitting water, emphasizing that there was a good chance they would not. He meticulously discussed every aspect of his costs: mobilization, drilling, well casing, grouting, etc. In short, he made sure I knew what I was signing up for and that it wouldn’t be cheap. You’ll notice Hank didn’t send an underling. Discussion of scope of work and cost is the boss’ job.
Hank immediately backs it up in writing. Within two days of our initial meeting, I received a written contract in the mail. The contract spelled out the same things Hank told me during the site visit and included a bottom-line cost. I didn’t wait a week or a month to receive the contract-it happened immediately. This sets a tone-an unmistakable, though unspoken message that Hank is all business. He is a professional and expects to be treated like one.
Hank doesn’t schedule work until a signed contract is in place. The cover letter attached to Hank’s contract was short and sweet. It accomplished three important things: A) It thanked me for considering Hank’s Drilling; B) It stated that they would schedule the work upon receipt of the signed contract; and C) It alerted me to the lien provision in the contract. Again, Hank was setting an “all business” tone.
Hank does top-notch work. Hank’s equipment was well-maintained and clean. His employees were professional: well groomed, they hustled, and they didn’t make mistakes. In short, Hank afforded no latitude for a customer’s gripe.
There is zero delay in invoicing. Handing me an invoice before leaving the site sent the clear message that Hank was serious about getting paid. Contrast this to other contractors I’ve used who didn’t send an invoice for weeks or even months. If they’re not concerned about sending invoices they must not be that concerned about getting paid.
They squeak immediately and keep on squeaking until the check is in hand. Every company needs a Mergatroid Crowbar. She is the reason that Hank’s Drilling is the business I used as an example for this column. Other companies I’ve worked with are roughly equal to Hank’s in preparing the customer for payment, but nobody, and I mean nobody has a Mergatroid equal to Hank’s. She is worth her weight in payment checks. Of particular note is that Mergatroid was on the phone to me the very next day. Had I told her that I couldn’t pay for a week because I needed to make a bank draw, here is what she probably would have said: “That would be fine, Mr. Garrison. We can allow postponement for one week. One week from today would be next Tuesday, the 23rd, correct, sir? I’ll mark that on my calendar and will call you if we haven’t received the check by then.”
To summarize, any company that wants to get paid must become deadly serious about making it happen. Think of it this way: most customers do not have enough money to pay for their overly ambitious construction projects. Someone’s going to get stiffed. Your company is competing, then, for its fair share. That means you have to be better at harvesting money than all the rest of the consultants and subs on the job. And harvesting money includes ALL of the following: tilling the soil, planting the seeds, keeping weeds out, picking the crop, taking the crop to market, and finally collecting the cabbage.
