construction subcontractor payment problems

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Helpline: +44 (0)1773 712116

Email: info@streetwisesubbie.com

Wise Up Wednesday: Get Through Coronavirus Crisis Together!

To help you get through coronavirus, It’s still business as usual at StreetwiseSubbie, as we are all working safely from home, or only a single person in the office if need be.

And our Helpline on 01773 712116 is of course still open.

There is no doubt that the coronavirus pandemic has divided opinion and has brought out the best in the vast majority of people, but sadly it has also exposed the worst in some people too.

Should You Be Carrying On Regardless?

Personally my stance has always been that if it is Covid 19 safe to carry on, then work should carry on. But, that is where the problem lies, because it is very difficult to make all sites safe to work on and indeed many construction activities cannot be done without breaching social distancing rules, never mind about being able to get to site safely, or guard against the transmission of the virus from surfaces, tools etc.

In other words there is a massive difference between one joiner travelling to site alone in his van and going into an empty house to second fix skirting etc. and that same joiner going to site on the tube in London to work on a site with 800 other trades where any number of obstacles prevent proper social distancing, or other forms of transmission.

And that is one of the main reasons that I have advocated shutting sites. There are lots of other reasons which I won’t go into here, but suffice it to say that, as always there are always those that will ignore, exploit, coerce, connive simply for financial gain, and some that are just acting in a downright despicable manner.

Getting Through This Together

Things are never going to be the same again. And as far as construction goes, some things should never be same again!

There is a brilliant article on the CIOB website by Professor Hedley Smyth in which he says;

“… these images provide evidence of a failed business model. The Contractor’s business model has been underpinned by low expenditure and minimal investment for decades. Rather than return on capital investment (ROI), firms have relied on return on capital employed (ROCE) using trade credit, delayed payments to suppliers and subcontractors, cash flow management and investing surplus working capital.”

In order to get through this, we need to work to change the way that risk is driven down through the supply chain, and the way that cashflow is strangled by the Main Contractors.

But none of this will change unless Specialist Contractors, Trade Contractors and Subcontractors cooperate and collaborate as never before. But more of that later.

First And Foremost We Need To Get Through This

Of course there are a hundred and one things that you need to be thinking about and taking action on right now. But, what I would encourage, if not implore you to do, is to ensure that you protect your commercial and contractual interests.

As you might expect we are seeing coronavirus problems manifesting themselves in dozens of different ways, but one thing is common to almost all of the situations. The Employer, the Contractor, the Consultants, all want to dump the problem onto the Subcontractors!

If that’s isn’t your experience, then that’s great, but even as I draft this email I am interrupted by another Subcontractor Client who is getting dumped on.

So what can you do to get through coronavirus crisis?

Taking Action To Protect Your Business And Get Through Coronavirus Crisis

First and foremost I have have recorded a short video which you can find here; Video Advice Protect Your Business

get through coronavirus crisis with streetwisesubbie

The video summarises what we have said thus far about how to protect your contractual interests properly, and whilst I have said that doing nothing is not an option, what I need to stress is that doing the wrong thing is not a good idea either!

There is no single “one size fits all” answer. You cannot adopt a blanket approach to this and every contract, every situation will be different.

Even where you are agreeing to “suspend performance” or “park the job” or whatever other expression might get used, it is imperative that you formalise that agreement in order to protect your interests.

There are a range of templates, presentations and other information available to you for different situations here; Commercial and Contractual Resources

Doing The Wrong Thing Is Worse Than Doing Nothing!

THE SITUATION IS VOLATILE We are already getting feedback that shows that despite the top brass of various companies saying they are doing the right thing, their army of commercial managers and QS’s are making sure that they pass all the financial consequences down to their supply chain!

So, please take the contractual side of things very seriously indeed and please do not think that this is going to be simple and straightforward, or that common sense and fair play will prevail…

Collect The Money That Is Rightfully Yours!

No Win No Fee Retention Collection

No doubt one of the consequences of the coronavirus pandemic is that your cash flow will be taking a bit of a battering! So now is a great time to focus on making sure you get your retention money back. And what better way than to get it collected professionally on a No Win No Fee basis?

Our professional Consultants understand how retention should work and the applicable law and we know all the dirty tricks that the Contractors use to hang on to your money, and most importantly how to get it back for you!

So, why delay? Call our Retention Hotline on 01773 712116 for details. Take the stress and hassle out of the process and use our expert team. Our specialist retention collections team take the hassle out of collecting retention owed to you and we will provide you with a proposal for a no collection no fee commission on retention cases where appropriate.

(Unfortunately we cannot offer a cost effective service for individual tradesmen where less than £5,000 is outstanding)

Get Paid On Time Challenge Spurious Set Offs

If you have a £10,000 plus payment problem you are entitled to free down to earth advice that will help you to solve your problem fast!

Our Nationwide Team have vast experience in resolving construction related payment problems and are available to help you get paid as quickly as possible.

Included in our team are Quantity Surveyors, Construction Contracts Consultants and Specialist Construction Solicitors, so we have the capability to resolve your problem fast, whether it’s £10,000 or £100’s of thousands!

So, if the Contractor is not paying you, or not valuing your application or variations properly, or is making a set off or contra-charge against you, or payment is delayed, and you want to know if you can suspend the works, walk off site, adjudicate or arbitrate then call our friendly Helpline and speak to one of our experts on 01773 712116 today.

Negotiate With Your Suppliers and Subcontractors

Obviously this has to be done very carefully and diplomatically, but you should talk to everyone you owe money to whether that be your subcontractors or suppliers.

You should try and limit the flow of money out of your business in just the same way as you are trying to maximise the flow into the business. It isn’t going to be easy and every situation is unique so don’t think there is one simple way you can do this.

If you are fair and reasonable and honest, then you should be able to reach appropriate agreements.

BE PREPARED FOR A LOCKDOWN!

Whilst the government have recommended that everyone that can work from home should do so, and whilst the current madness of keeping sites open continues for the moment, there may still be a full lockdown.

So, please make sure that you, or someone in your team has access to every contract that you are working on currently, or have money outstanding on.

Because when you need help, the first question we are going to ask you is what does the contract say? And if you can’t answer that question because you can’t get to the office to get it, then it is impossible to advise you!

Get Through Coronavirus Crisis. Call Our Helpline Sooner Rather Than Later

Our friendly team are on hand to ensure that you get the help and support you need. Call us on 01773 712116 or email StreetwiseSubbie here.

Please take on board what we saying, this is not some scaremongering BS, because I see first hand what happens to naive Subcontractors.

Take action now to protect your business, your team, and your family.

And do stay safe..

Remember, it’s all too easy to ignore this and put your business at risk. Please don’t do that. Give our friendly Helpline team a call on 01773 712116, or drop us an email here today

Get Through Coronavirus Crisis. Working For A Better Future for Subcontractors!


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Construction’s a tough place to do business right now, and Specialist Contractors need all the help you can get. That’s why you will find our resources and expertise are invaluable, whatever the size of your business and whatever your specialisation. We’re here to help you solve all your business problems, including the crucially important contractual ones, such as getting paid.

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