Jeff,
Welcome to the wonderful world of big business in 2009.
Most states allow a contractor to ask for a reasonable deposit upon
executing a contract. Often it's about 10%. On an order that size, I'd
get whatever the law would allow upfront and COD for the big ticket
items. It's reasonable to leave yourself on the hook for your labor
and the smaller stuff until the job is completed so long as your
contract clearly states a short final payment timeframe and as much
interest and late payment fees as your state will allow if they miss
it. Almost all clients will accept that a contractor needs some good
faith money and go for that. Offer the same deal of 10% upfront to
your PV supplier and they'll likely say, "And where did you say you
would like these shipped?" Doesn't alleviate the problem of having to
have good cash reserves or good credit, but it will help.
If either the client or the distributor doesn't get it, do business
elsewhere. It's harsh and a bitch to have to walk away from a good job
that you've put a lot of energy into, but it seems unwise (at least in
the present economy) to extend yourself any further than that.
Good Luck, Bob-O
On Jul 6, 2009, at 6:57 AM, Jeff Yago wrote:
Most of our projects do not require ordering and stocking large
quantities of solar modules, so we usually order in one pallet at a
time quantities since most of our installs are in the 4 to 6 kW size
range. However, we have a firm purchase order for over $100,000
worth of Solar World 175 modules, but the client will not pay anything
until the modules have been shipped and received in good condition. I
have been able to get their agreement to pay COD, but have not found
any supplier who handles Solar World 175's and is willing to fill this
large order without payment in full at time of shipment.
If we cannot make this work, I will be forced to go back through the
process of getting another module approved for this installation and
find a supplier willing to make this work using a different module
brand, but I hate to go through all this after getting the SolarWorld
175's approvied by both the architect and client. They are ready to
purchase these today.
How do you handle these larger special orders without having to have a
$100,000 line of credit with each material supplier?
Thanks,
Jeff Yago
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