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A case for taking deposits, your thoughts please?
Following a bit of online advertising we’ve had a few leads through the websites and Facebook, mainly for van signage.
We had one customer who we dealt with via Facebook (not my preferred choice), the design and everything was sorted.
It was provisionally booked in for installation today, provided we received a 50% deposit on Monday morning. Monday came and went and no deposit was paid.
This morning (the day it was provisionally booked for) we get a message asking that the logo be changed, on their van.
I explain that as no deposit has been paid, we’ve not ordered the vinyl, let along produced anything, and as such we can’t install it until the end of next week.
Customer has a show then, so needed it early next week, earliest we could squeeze is Tuesday mid morning, which is the day of the show, so the customer going to have to go elsewhere.
If we didn’t have a deposit system in place:
We’d have all the vinyl cut, and we’d now be cutting two new large logo’s for their van.
We could have ordered in the vinyl, but not cut it? But still end up with needless stock.
Worst case we’d have produced everything, two new logo’s and then the customer didn’t show up, and we’re out of pocket and lost the production time.I must admit, we need to streamline how we deal with leads through social media, as it didn’t get followed up like we usually do.
A prime example of why we should be taking deposits. :thumbsup:
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10 Replies
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I have a slightly different approach in that I don’t ask for a deposit when booking a van it – but also don’t cut anything until the van has arrived on the day. This is to ensure that I can check sizes and make sure everything fits, and that the van actually turns up. I keep a big stock of varied colours so don’t normally have to order in vinyls specifically for a job unless it’s an unusual colour.
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We don’t have the space to stock much vinyl.
I personally prefer to have everything cut and ready to fit prior to the van arriving, then just get on with the installation, takes the pressure off during production when things have a tendency not to go to plan. 😆
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I feel that a deposit will make a big difference to the customer’s commitment to the work about to be done.
I’ve had several "little" jobs that have gone down the route of "sorry I forgot" and then the day is wasted because the diary was arranged to fit in the install.
The best one was a van booked in and the graphics printed / cut, and the customer "forgot" and instantly re-booked for the following week. And then at the weekend they blew the engine and scrapped the van! And the new van that replaced it has been in use for 6 months without any signage because they won’t commit to a date.
Although I won’t print anything until a deposit is secured this time!
Deposit works for me. -
I dont seem to be able to take deposits, it sends the customer running. We tried deposits at some point last year, especially on larger jobs 500+. Every quote i submitted, we never got the job which was very noticable considering we get 90% of our jobs normally.
We take the risk but having been burnt a few times we do checks on new customers, costs a couple of quid. If they have any debt at all then its payment up front. A few people we have never seen again which shows they had no intensions on paying anyway.
I dont see any reason why customers shouldnt pay 50% on confirmation of order but like i said it doesnt always work in the real world.
It would cost us more in asking for deposits rather than non payers so we take a certain amount of risk. -
Sell the deposit to the customer.
Why should your paying customers have to pay for the time & waste that time wasters create. Prioritise the paying customers.
Today, instead of spending time and effort making graphics that I haven’t been paid for, we’ve been paid deposits for work, and they’re booked in for next week.
When we’re busy it’s even more important. Holding a day for an installation and the customer changes it, you loose a day. A day that could have seen another customer’s job get done, and you get paid.
We do have a few credit accounts, but it’s very select who we give it to.
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I totally see your point david and if you can make it work then thats great. Just saying tried and tested for me but it didnt seem to work. Maybe i need the customer more than they need me 🙂 in years to come this may change but for now i need to do everything to stop them running for the hills.
Prime example, i have a lorry to do next week. Been discussing, designing and planning over the last few weeks. Its a fairly big job for us, over 1k with few hundred quid in materials which ive outlayed. He has paid no deposit and it was booked to fit on monday but since today with delays as its a new truck, its been moved to tuesday.
Now in my world, or country 🙂 we have a good reputation for being a resonable and relaxed company that can work around problems, like this. He is a local chap, we asked about him to a few people and got good feedback.Now to work it the other way and ask for a 50% deposit upfront, and today tell him "well as you have changed fitting days im going to have to charge you this……" just doesnt seem to work for me and i think "can" end up leaving the customer with a sour taste in his mouth.
Now although im saying this, i still 100% agree your correct. Just cant see how you can make it work.
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All I will say is, all the items sitting on the stillaging, wether it’s cut graphics that are waiting for the customer to ring for fitting or clothing with logos on… All are jobs where no deposit were taken.
99% are people we have done work for already. -
We’d probably not charge for having to move an appointment, things like that happen.
It’s more the no shows it reduces, and does filter some time wasting customers out.
Even a £50 deposit, is better than nothing. We have a minimum 50% deposit, if it’s a job with small margins, or low value order we’ll ask for 100%.
When you’ve never asked for deposits, it is hard to change. I remember feeling cheeky, even a bit cocky. It’s a whole different mentality. Soon it becomes normal. We don’t hide the fact, and have it on our quotes.
Best bit out cashflow has never been better 😆
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I’ve just had a quick look at some of the bits and bobs that are sat on the shelf – a couple of hoodies and the odd tee, and 2 different graphic kits. There’s probably more that have been stashed elsewhere.
Again, the common thread – none of them had a deposit taken.
All are lost revenue – wastes of time, effort and money.
There’s no reason why customers should be offended when discussing payment terms – surely if they bought their budget vinyl graphics from a certain auction website they would have paid upfront in full before they received their goods? -
quote David Hammond:We’d probably not charge for having to move an appointment, things like that happen.It’s more the no shows it reduces, and does filter some time wasting customers out.
Even a £50 deposit, is better than nothing. We have a minimum 50% deposit, if it’s a job with small margins, or low value order we’ll ask for 100%.
When you’ve never asked for deposits, it is hard to change. I remember feeling cheeky, even a bit cocky. It’s a whole different mentality. Soon it becomes normal. We don’t hide the fact, and have it on our quotes.
Best bit out cashflow has never been better 😆
Yes we do this as well David we always take a 50% on expensive orders and 100% on small orders, this is written on the quotation terms and conditions we also take card payments and Bacs and STATE NO CHEQUES, the last thing you want to be doing is wasting time going up to the bank to put a cheque in for £30-50!!! and when they ring just be firm with them, as we say you wouldn’t go into a supermarket and ask them if you can put it on credit for 30 Days
I use World pay Zinc for Card its no fees and 1.95% transactions when paying £6-99 per month but worth it to keep your cashflow going
https://www.worldpayzinc.com
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