By Ron Pestone
Probably one of the most difficult tasks in construction is getting paid for your services and work. This applies to contractors, architects, engineers and anyone supplying professional services in the industry. Collecting is difficult if you are a small, medium or large organization and every area of the market has its share of obstacles when it comes to collecting what is rightfully theirs. When it comes to collecting contractors and professionals in the business have very few tools in their arsenal to assist them. In fact more often than not the road blocks to collecting are staggering and come from all sides of the industry.
Let’s start by talking about what doesn’t work. Threatening someone with bodily harm or actually roughing them up to collect your money works in the movies but in real life it ends badly. No one likes to be threatened and it gives the person you are threatening a bona fide excuse in his or her mind not to pay you. Now they can go to sleep at night having convinced themselves they were going to pay you all along but now, never. Nobody is going to threaten them and get away with it.
If you make the huge mistake of actually taking physical action to collect your money you will never see your money; you will have a much better chance of seeing the inside of a jail cell. The law is really harsh on this type of collection. The crime is that many times it’s the small guy who has broken his back to get the work in and needs the money for groceries and rent who resorts to that situation. A man who has gotten stiffed when he is in that situation acts before he thinks and in the process lashes out and destroys any chance he ever had of collecting his money.
So after putting these two avenues to bed, the question then arises what does work? The real answer, the truth, very little other than legal action. What you hope for is a form of honesty and decency from the party you are trying to collect the money from. I know it doesn’t sound like much to hang your hat on but in the long run it’s going to play a large part in your collecting.
Next week’s blog will cover the ins and outs of liens.
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