O/T: Lockheed, Martin Marietta, Linkbelt. Did some work for them. Anyone else?

[Tim Clarke]

A slightly different perspective, caught in the middle. I worked for a local owned fleet for many years. While we were pretty small as far as truck fleets go, we were the largest independent garbage company in Oregon. We had a large share of the business in our area, and were huge in commercial accounts. We were known for paying our bills. Every couple weeks, they would issue checks to our suppliers. I bought lots of truck parts. Both as a mechanic in the shop, and later as maintenance manager. No problems whatsoever, even companies where we'd never bought before were smart enough to know if we didn't pay, they could reciprocate by not paying their garbage bill.

Times got tough, and our owners needed a cash infusion to keep some of their other enterprises afloat. The only thing they had still doing well and making money was my company. We were sold, and they managed to salvage their holdings, and are doing well. I would have done exactly the same thing if I had been faced with a similar situation.

New, nationwide company bought us, and stopped paying bills in a timely manner. Eventually they sent a letter to the vendors outlining their policies regarding payments. But not before non payment for 3 months. I was one of the first to take heat since I was on the firing line. A couple told me they really couldn't afford to work for us. Later I found out their payment arrived 88-89 days after the monthly statement. My job got really tougher, this was only one way that it did. Eventually I was offered the chance to re-apply for a position I had held for 31 years. Lucky for me, I wasn't selected. There's life after corporate america, And I'm really happy of be rid of them and the pernicious bean counters. I'm an old guy now, I miss the trust I shared with the fine people and companies I dealt with for so many years. I wonder if it's even possible now in the new age?

[JRouche]

HaHa, great idea. Just charge the interest up front for the slow pays. And the best part is they never realize they're getting dinged. The quote is the quote, buy or go somewhere else.

I think that is come practice. From what I have seen, I never had a shop or business (well).. JR

[Mcgyver]

Jump through the hoop then wait 120-180 days for parts purchased on net 30 terms. The people who were in charge of paying the little people were always on vacation or otherwise occupied or couldn't be reached.
.

The whole thing is so epically stupid its kind of funny. It comes from some bright spark in treasury realizing "hey, if we stretch payables, that's a reduction in working capital = less capital overall = high return on investment". True my sparkly treasury nerd, but what counts more than ROI is profit. Giant Co. has an very low incremental cost of borrowing, where as the little guy, me, has a high cost and a lot of the time it ends being equity which is the most expensive of all. So...instead of Giant Co getting an extra 60 days (worth say 1/6 of 3% or 0.5%) what they should do (some indeed do) is is use their superior borrowing power to pay right away but with discount, i.e. payment in 10 days for a 1.5% discount. 3x the profit that way vs forcing us little guys to be there financier.

How bad it is: I have one customer, says finance insists they will only pay in 90 days. I say ok, but I have to quote 10% higher. The Ops guys buying say no problem. Too funny....sparkly treasury saves 0.5% and but pays 10% more. Meanwhile, I'm loving the juicier profit....where do I find more of these insistors? lol

I usually up the price 5-10% for those accounts figuring those sorts of policies keep most of the small low cost guys out of there. It seems to work.

[754]

Number one rule , always add the PITA premium on certain customers..
pretty sure most do , given the chance..

[Bob La Londe]

After 2005 during the crash a lot of companies got the idea to throw all kinds of crazy terms at their vendors just to see if they were desperate enough to keep money coming in to go for it. I politely told every single one of them to go pound sand. I only lost a couple of customers and amazingly they were the ones that were always the most problematic to deal with. A couple managers called me and asked why I wasn't signing up like everybody else and I told them. I couldn't afford to do business that way as a small business. It wasn't fair for me to have to finance them and live on whatever I could scrounge out of the dumpster behind McDonald's. Some of my best customers gave me more work than ever after that. And they paid on time.

One company that I did keep was kind of funny. I told them that the terms they dictated meant that it didn't meet the cancellation clause in my contract but they would have to pay penalties, explicitly not interest but penalties, on late payment as it stated in their contract with me. For the next several years they ran 60 to 90 days past due and they paid the penalties. Just made me shake my head.

[Duckfarmer27]

I was a manager from one of the initially listed companies, long time retired. They got real stupid in the way they treated vendors over the years. I had a vendor who supplied LP gas for our tow tug, Local guy in a small town with our large facility. Company owed him something like $150 - unknown to us - and was over 90 days late. We were just about out of gas. Local guy says he's tired of fronting such a huge company so nor more gas. Did not blame him at all. So I start calling to get this guy paid. Several calls - and multiple states - later I finally discover the czar who can decide to pay 'before we usually do'. The clown was a director level. Not very sympathetic to me - until I tell him I will not be able to ship a $30 million dollar aircraft/system because I can't tow the damn thing out to the flight line. Bill got paid that day.

I've been a small business owner as well as military and manager for a couple of the largest corporations in our country. Was raised to pay my bills - personal or company - on time. The greedy people running many places these days will be the death of our economy if things don't change. But then I'm just an old curmudgeon. Only smart thing to do, if you have to deal with them, is jack up the price to compensate for the pain level. Many are stupid enough to pay.

[TGTool]

[QUOTE=Duckfarmer27;n1916809}
<snip>
. Only smart thing to do, if you have to deal with them, is jack up the price to compensate for the pain level. Many are stupid enough to pay.

[/QUOTE]

It can be a kind of an organizational Aikido, using their assault energy to throw them. The guy writing checks for payables has his orders for not paying til 90 days which he dutifully does. There's no corporate policy for skipping penalties due so he's perfectly happy to do that.

[Bob La Londe]

It can be a kind of an organizational Aikido, using their assault energy to throw them. The guy writing checks for payables has his orders for not paying til 90 days which he dutifully does. There's no corporate policy for skipping penalties due so he's perfectly happy to do that.

Yep, got some of that too. I usually had the courtesy to call the local manager and let him know that after multiple late notices and accumulated penalties they had past due balances exceeding the cancellation term on the contract for their alarm system monitoring, service contract, phone system lease, etc. Some would say, "its only penalties," and "I would say our contract says we don't offer net terms and the penalties are detailed in the contract. You owe it and its so far past due we will be by to pick up our equipment tomorrow." Some (very few) cancelled service which was ok with me. Some suddenly became the fastest paying customers on my RMR roster. Unless they went out of business I got paid what they owed me either way. Its amazing how fast a dead beat Fortune rated company pays when you let them know you are filing a lien on their multi million dollar facility. (Sometimes that's the first time they respond to your demand for payment.)

Had a big outfit (a maquiladora) with about a 1/4 square mile finishing and shipping facility stateside try to stiff us on the final payment on a big video and access control job. We were ignored for months until I sent them a fax letting them know I was going over to the court house the next day to file a lien. I got a call within minutes from the plant manager with all kinds of excuses, and when he finished talking I said, "I would suggest you have that final payment sent Fed-Ex with AM delivery. I'm planning to go over to the courthouse at lunch time." 10:30 the next day FedEx walked in my door with a check. On a job that size there are always little things that need tweaking and adjusting. We answered every service call promptly and took care of it until our warranty ran out. Then when they called I told them how much the advance deposit was for a service call.

My contracts also included a clause that says the contract itself serves as notice of intent to file a lien in the event of nonpayment or late payment. I also added a line above the signature that said, "By signing I agree to all terms and conditions on the reverse side of this agreement."

I personally really struggled with contract updates over the years. I hate long contracts. Addendums for materials and labor description sure, but the contract itself in my opinion should fit on one page. I manage keep it to one legal size sheet, but it was a struggle as I added more and more CYA clauses over the years. Now when people send me NDAs that are more than a couple pages long I don't even read them. I just throw them away. Most are more coached in terms to restrict trade than be a true nondisclosure anyway. Almost none include a morals clause, and that's a deal breaker for me. No morals clause no signature.

Story Time:

ASIDE: I knew that maquiladora was going to be a problem from the start. We had a big meeting with a bunch of managers where the plant manager made a big show of signing the contract and telling me to start ordering parts. Two weeks later he called when I had not shown up on their site, and I told him the deposit payment had not arrived yet. Five days later he called again saying the check was on the way I should start ordering parts. 5-6 days later he called and complained that I said the job could be done in about three weeks and I had not even started yet. I just said, "We haven't received the deposit check yet." The next day when I received the check Fed-Ex I ordered all the parts for the job.

When we had all the parts, cable wire, etc on hand I went down to Home depot and purchased a bunch of steel job boxes. Then we made a big show of showing up on their site with two pickup trucks and a trailer full of materials and asked for a secure area to store equipment on site. They gave use an unused office and the key to the office. We paraded all those big job boxes in, chained them together, padlocked everything, and left. When I got back to the office I invoiced them for the progressive payment for putting the equipment on site.

About tens day later I got a call. The manager was whining at me and commented on our big show of delivering all the materials and then not coming back. I just said, "You haven't made the progressive payment." He said I should get started because the check was on the way. You'd think he would have learned I wasn't going to budge by now, but three days later he called me again asking when I was going to get started. I let him know the payment schedule was in the contract. "When you make the due payment we will get started." Yep. The next day a check arrived by FedEx.

From the day the second check arrived until we walked them through the systems was just over 2 weeks.

I halfway expected him to get mad and cancel at some point, but I knew I couldn't afford to be on the hook for a job that size.

[754]

I am guessing here, that nobody was a fan of companies switching to just in time inventory amounts..
that was a PITA..

[Bob La Londe]

I am guessing here, that nobody was a fan of companies switching to just in time inventory amounts..
that was a PITA..

As a contractor I learned to say no to a lot of things and the last 10 years I only took as much work as I could do by myself. I would tell customers "if you can wait three months sure, but if in 3 months somebody else is first with cash their job would get done first." Now as a specialty machinist I always run 2-4 weeks lead time on ready to cut designs I own, and 2-4 months (sometimes 6) on custom work with a published first paid first made policy. I do have a Line Jumping Super Pass like Disney Land and like Disney its comes at a premium. One million dollars in advance and does not cover the cost of the project. Its good for one project.

I get a lot of guys go elsewhere, and that's okay. I really do not want to have years of work backed up.

Me a just in time vendor? Yeah, I don't (insert-expletive-here_ing) think so!

[JRouche]

I was on the US contractor bidlist for a long time.

Mostly all I ever got from that was people calling me up and wanting to charge me to tell me how to be a government contractor. One of the other thing I would get is weird calls for stock orders of things I never heard of.\\\\\\\\\

Once in a while I'd get calls from another government contractor asking me to write the spec for a job they didn't know how to write with the impression that if I kissed their ass, asked if they wanted more, and did it all for free I might actually get to bid that portion with them. It was all bull**** of course. Every government job I ever got was because somebody who knew me called me up and told me they wanted me to bid a job. A couple times I was told to update my contractor listing so I could bid a job.

Yeah, thats what I have seen. JR//////

When I first started doing GSA stuff every job was invoiced from a purchase order and took about 60 days to pay (if it was direct for the government), then they updated around 2000-05ish and started paying PO invoices faster, and then a few years later went to credit card for everything. I would get paid in a few days from getting a signoff of completion. Sometimes the same day somebody would call me with a credit card number. The last couple jobs I did for the Army they told me I could do progressive billing, but I was done so much faster than they expected that it didn't matter.

Worst pay time I ever had was as a sub for a sub on a network cabling job for McDonald Douglas. Just about broke me in 1995. They just refused to even respond to billing, demand, and late notices for months and months (I did all the work and provided all the materials). Finally we sent a letter to the Commandant of the Marine Corps informing him of our intent to file a lien on his marine base. 3 days later the primary sub received a FedEx envelope with payment in full. He was in my office the same day with a check. I did a lot of work for that guy over the years, but neither of us ever did another job for the Marine Corps or for McDonald Douglas. LOL. Army, Airforce, Justice, misc GSA, yes. McDonald Douglas. NOPE! I even provided some materials for Lockheed and later Loral on an aerostat site (because somebody I knew called me.)

Yes. Not an answer to my question though.

No big deal cause that story was very nice, Thank you Sir.. JR

[JRouche]

See. That is the problem.

I asked if anyone worked for linkbelt, martin or lockheed...

You folks went way off tangent.

The Question is in the header.. JR

Lockheed, Martin Marietta, Linkbelt. Did some work for them. Anyone else?


Edit: Except for Pete. He answered my Q?

[fjk]

See. That is the problem.

I asked if anyone worked for linkbelt, martin or lockheed...

You folks went way off tangent.

The Question is in the header.. JR

Lockheed, Martin Marietta, Linkbelt. Did some work for them. Anyone else?


Edit: Except for Pete. He answered my Q?

I worked at a small company that did a joint project with one of the firms you mentioned. It does not matter which one. Things started to go bad when they insisted that we “adjust” our proposed numbers in a way that would have earned us an extended period clothed on orange jump suits as guests of the government.

We won the contract

then it was two years of weekly reamings from the
prime contractor about how we should do things not in the contract, charge less money than we actually spent, and so on. Yet more opportunities to get a nifty orange jumpsuit...

payment was not an issue since the government paid the contractors & subcontractors directly, the money didn’t go through the prime contractor.

frank

[Bob La Londe]

I did mention I supplied some material for Lockheed & Loral. Actually supplied material and equipment and did some shop repairs. I don't recall their being any problem, but it was another one of those where somebody on the site asked me if I could help because they knew me. If there were any delays I am sure they told me up front what the delays would be. Most government agencies and government subs I did work for or sold material to would tell me up front about expected timelines. I could adjust accordingly. They wanted me to do the work or provide the material, and they didn't want to poison a relationship. If you don't have a personal connection that may not be the case.

[JRouche]

money didn’t go through the prime contractor.

frank
frank

Thats very unusual. It doesnt and didnt work like that.. JR