Around the world, the construction industry faces the persistent problem of late-paying clients, and the issue is ever-present here in South Florida. General contractors often find themselves tracking down past-due payments weeks and months after the project is complete. This can have a significant impact on your business’s operations and your overall cash flow. Fortunately, there are some ways you can reduce late payments and avoid having to take further legal action against your client.
Easy Ways to Reduce Late Payments
● Draft strong construction contracts with specific payment schedules - Step one is to eliminate any possible confusion with payment expectations, terms and deadlines. In your construction agreement, dictate the scope of work, payment schedule and consequences of late payment. Partner with a construction attorney to ensure your interests are protected with a thorough construction contract.
● Vet potential clients - Next, don’t be so eager to take on a new project that you forget to check into the financial stability of your potential client. You need to be sure your client has the credit backing to fund the project. If there are any red flags with their credit, walk away now!
● Be prompt with invoicing - This may seem obvious, but it can easily get forgotten in the midst of busy project schedules - send your invoices on time. Use automated software or whatever process works for your business in order to ensure prompt invoice delivery and receipt of payment.
Tracking down late payments can quickly spiral into a major problem that could require expensive litigation to resolve. It’s in your best interest to do everything you can to ensure timely payment. That starts with strong construction contracts. We can help. Contact us at Quintana Law, PA to gain expert legal representation for your Miami construction business.