IMe and another guy quit the same company and we both started our own businesses 8 months or so ago. We both did work for each othewr and everything was great. The last job was actually 3 different jobs: 1 4'x4' MDO realestate sign, 1 backlit acrylic sign and the 3rd was to be a lexan sign say, 2'x 16'. I quoted him $1400 for all three. He gave me 700 deposit to start working. I knocked off the 4x4 and the acrylic sign but got held up on the Lex. His customer put it on hold. The 4x4 and the acrylic came to $585 and I spent just about the other $115 in designing the lexan sign that was put on hold. He went back to work for the man and hadn't heard from him in 5 months. He called to say that he needed another 4x4 and he would drop off a check. I gave him a super price (for him) of $170. When I got to my office with the MDO and vinyl, there was a check waiting for me for the sum of $55. I have told him that the $115 left over from his deposit was absorbed in designing the sign that never pulled through and he seemed to understand. I am thinking his wife and partner got in th emiddle and decided I owe them the $115 from before thus giving me only $55 to cover a job that is costing me $90 alone for materials.
What should I do?
Posted by Rick Chavez (Member # 2146) on :
Business is business-You need to make a contract out, even for friends, that way, you both understand, and stay friends. Deposits are for more than just materials, maybe you put a time limit on it, and kill fee, that way you get paid for your troubles, and not feel that you got a raw deal either.
Rick
Posted by PKing (Member # 337) on :
Learn something from this experience. Is my suggestion of "What should you do?"
Hope this helps
Posted by Joe Rees (Member # 211) on :
Forget about the design time on the old lexan sign for a minute - that part of the job is botched up. Either it never really got properly approved or you took too long to produce it or uncontrolable stuff just ganged up to take it away from you. Unless you had a specific agreement that the design time was itemized as separate from the fabrication, kiss it goodbye. That's the way it goes sometimes.
I can clearly see why he feels he has a cash credit with you. You've had his money for 5 months. Now he'd like it back and he's giving you the chance to pay it in signs instead of cash.
Regardless of how it happened, think about if it was you who had given him $700 and only gotten $585 in goods back. If you quibble about who's 'fault' it was that the old job got cancelled it is bound to cause friction. This might be one of those times to have a frank discussion about how to avoid repeating the problem in the future.
Posted by Corey Wine (Member # 1640) on :
I beieve I am free and clear of any legality. I have no prob. ripping his check up for 55 bucks and saving the 2-4x4 MDO pieces for a customer that'll pay $220 a piece for them.
Posted by Joe Rees (Member # 211) on :
Two 4x4s? The $170 was for 2 4x4s? No wonder you're looking for a way out. Still, it seems to me like giving his $55 back would cinch alienating him permanently. It's not a legality issue, but one of communication and unusual circumstances. A deal fell through. Not his fault any more than yours. It just happened. Letting 5 months pass before dealing with it directly has put you guys at odds and you don't need to be. This new offer sounds like it might be a chance to rectify things.
Personally, I think I would just bite it and make it up with more lucrative future dealings between the two of you. If you can't abide with that, and if he was agreeable, how would you feel about splitting the 'design fee' with him? Then get on to better days. good luck with it.
Posted by Corey Wine (Member # 1640) on :
You are way off base with this communication gap Joe. His customer never gave him a deposit on the Lex. He DID give me a deposit for the Lex job. I designed 4 layouts taking me 2 hours or $120 design time. No, its not 2 4x4s it's 1. I told him to cover materials and I also knocked an hour off of labour. Ya' understanding now or is there more bloodshed on Letterhead about to start?
Posted by Mike Pipes (Member # 1573) on :
When it comes to money issues, in my opinion and in my practices, there is no such thing as a "friend or family rate".
Mixing money and friendship never works, it always comes back to bite you in the butt. No matter what the "deal" was, someone is always left feeling cheated so everyone pays the same price now.
The only exception is if I've had a really exceptional week or month and I'm feeling generous.
That doesnt help you in this situation but you need to figure out the right thing to do on your own because every situation is different.
Have you *asked* him why he gave you a check for 55 instead of 115?
It sounds to me like there IS a communication problem. If he understood the 115 was absorbed in designing the job that didnt come through, he would have given you the full amount. Somewhere along the way he (or someone else) decides 55 covers the balance but nobody told you about it.
You need to make him understand you performed work on a job and regardless of the fact HIS customer backed out on it, you still did work on it and he owes you for it. If he would employ non refundable deposits, he shouldn't have a problem with it... unless of course his own business is fledgling along and he spent the money on bills or whatever.
Now on your side, yeah you spend the time to design it but realistically you didnt spit money out of your pocket to front any costs on real product so design labor is easier to "eat". You can either eat the defunked job's design cost or continue to make it a source of friction between you and a "friend".
Ultimately, when it's time for him to pick up the signs you can hit him with the extra $115 for design time he hasn't paid for. Itemize the invoice, remind him you've given him quite a discount on the other items and if he refuses to pay the balance he simply does not get his signs.
Posted by Wayne Webb (Member # 1124) on :
Corey, It looks like you should have gotten it in writing. But the way I readit, you didn't sit on the job for 5 months.
If I understand it right, you did tell him about the design time before he cut the check:
quote:I have told him that the $115 left over from his deposit was absorbed in designing the sign...
But, what was the actual design time? You said it was "just about"
quote:I spent just about the other $115 in designing the lexan sign that was put on hold
He gave you a 50% deposit on the whole job right? He indicated that he understood about the design time BEFORE he cut the check right? Is it your fault that he didn't get a deposit on the lexan himself? Doesn't seem like he respects your time very much.
I would determine what the actual design cost {not "just about"} was and tell him so.
Then I would do one of two things depending on your relationship with this person:
First If he is an underhanded user I would give him his check back and decline the 4x4 job. If he wants to fuss about the $115, give it back to him and be done with him.
Or, if he is a good friend. I would give him the benefit of the doubt and eat the design time. Get it in writing next time.
Posted by Joe Rees (Member # 211) on :
quote:Originally posted by Corey Wine: ~ saving the 2-4x4 MDO pieces for a customer that'll pay $220 a piece for them.
Pardon me, I thought you were saying he's ordering two new ones. Maybe I don't understand - wouldn't be the first time. Sorry if I came across funny, my bad. No bloodshed please.
