Anyone used "Transpact" for payment?

[dansk]

Following a recent run of customers trying to chip away at my quote and my recent fear the customer cannot actually afford the work Ive been looking at some solutions.

Ive come accross this https://www.transpact.com/ which seems to be ideal - quite simply create an account, upload your terms, customer uploads the money, then you get paid on completion, the client has to release the money but at least you know its there.

Flat fee of £2.99 each which can be paid by one person (me in this case)

Seems to be a great idea - i just wondered if anyone has used/is using it and/or do you know of an alternative?

TIA

 

[Geordie Spark]

So basically your customer lodges his cash with this website and when the job's completed the website gives it to you??

I wish I had thought of that..

I'd be living in New Zealand or some other exotic place by now.

 

[Plonker 3]

But who says the job is completed before payment is released?

 

[trev]

Or you could spend a few X £2.99 on a lawyer to nail down your T&Cs and get the customer to sign them before every job.
The risk is the same, either they'll cough up no problem or they'll fanny about and your payment will be delayed.
I take payments in thirds for every job over a certain level. 1/3 at the start, 1/3 on completion of first fix and the final 3rd on completion and handover.

 

[tazz]

The above by Trev is a sensible idea, along with written terms and conditions.....there is a lot of sharks out there, and not all are joe public, so contractors are even worse.

 

[trev]

I don't think it's altogether a bad idea though. I just think that say over a hundred jobs = £299 you could use a lawyer for not much more.

 

[davesparks]

An honest customer will release the funds on time but would also pay direct on time.
A dishonest customer will not release the funds on time, or pay direct on time.
So you loose £2.99 from every honest customers invoice and have just as much hassle with the dishonest ones.

 

[dansk]

Interesting points - no i dont think its a bad idea either - and we do have T&C's and booking forms etc, but that doesn't prove they have the money to pay in the first place - im not talking about using this for £500 jobs, my average order value is a few grand a time, so it would be comforting to know at least the money is there and been held until released.

The money is released by the customer when satisfied or when a certain condition is met - but - they could still withhold in the event of a dispute, at this point that website offers a mediation service also.

The key thing is not to have any unhappy customers which is 99% of the time, but you cant keep everyone happy all the time and at some point someone will be upset and not want to pay.

I feel even in the event of a dispute the money is still there and will be awarded one way or another (maybe not in my favor)

Thanks for the reply.

 

[trev]

So suppose a customer has a £10k job. They lodge the cash with these guys and have a dispute, they refuse to release the cash and mediation doesn't work. What happens to the cash?
Another scenario - The customer has the same £10k job and lodges the cash with these guys. The job is completed and everyone is thoroughly chuffed to bits with it. Transact meanwhile go bust. The customer as far as they're concerned has paid the required amount for the job so they're happy. Meanwhile you're £X000 out of pocket for materials and are an unsecured creditor. What happens?

 

[tazz]

Its very hard in business to know who and what customers to trust....its even harder in commercial contracts, and I said on the forum in the past that I personally have lost thousands to contractors. There is no company or agency who will help you with non payers or slow payers, and sometime the law doesn`t help, when these companies employ the best solicitors money can buy. So you need to take matters into your own hands. Stage payments is one minimum solution, with first fix cable and labour (loss is reduced) second is to spit your stages as much as possible. ie 4 stages of first fix and 4 stages of second fix. And believe me if first stage first fix is not paid, never move on to next stage, not matter what you are promised.

 

[123]

So suppose a customer has a £10k job. They lodge the cash with these guys and have a dispute, they refuse to release the cash and mediation doesn't work. What happens to the cash?
Another scenario - The customer has the same £10k job and lodges the cash with these guys. The job is completed and everyone is thoroughly chuffed to bits with it. Transact meanwhile go bust. The customer as far as they're concerned has paid the required amount for the job so they're happy. Meanwhile you're £X000 out of pocket for materials and are an unsecured creditor. What happens?

Exactly this. It's not reducing the risk, its increasing it as its not just the customer, its the middle man holding the money. Best advice imo is post 4, staged payments.

 

[trev]

My post at #4 is the only way. That way you are limiting the amount you can lose.

 

[Geordie Spark]

I think it's got scam written all over it.

 

[dansk]

Maybe so - but no one has any other way of proving the client has the funds without actually saying "sir can you show me your bank balance" which no one is going to do.

At least using this method proves the funds are available.

I have also wondered about liquidation of the said firm - im assuming (dangerous i know) the funds are held in separate holding account seen as they regulated by the FSA, this needs more investigation.

Plus the added hassle of trying to tell the customer this is legit, it probably creates more questions than it solves.

Been an interesting thread and the sole reason was to ask opinions - stage payments remain the favorite.

 

[Engineer54]

The system as described by the OP is the standard means of payment between client and main contractor for every major project throughout the world. Yes there are going to be a lot of differences but the basic system is the same. The client lodges agreed contract stage monies with a commercial bank that the contractor draws on when conditions have been met. On major projects this will be assessed by the QS's (Quantity surveyors) on both sides..

As i say this is the standard payment structure for all medium to major projects and subject to the contract signed by both sides...