Contractors suffer at hands of cowboy clients

Grant Prior 7 years ago
Share

Three quarters of small and medium sized contractors are suffering at the hands of “cowboy clients” who delay payments or demand extra work for free.

Research by the Federation of Master Builders has revealed that:

• Nearly three quarters think cowboy clients are a serious problem for their businesses
• Nearly a quarter have had to wait for more than four months for payment from a client or large contractor
• Fewer than one third are always paid within the standard 30 days.

The knock-on effects that late payment are having on construction SMEs include:

• 30% have had to delay payment to suppliers
• 20% say late payment stopped them from having the confidence to grow their business
• 16% had to borrow additional funds from a bank or other lender
• 8% almost went out of business
• 5% had to withhold wages and salaries from staff
• 4% had to let staff go

Sarah McMonagle, Director of External Affairs at the FMB, said: “There are so many horror stories of people being duped by cowboy builders.

“However, our research shows that there’s a flip side to this story with three quarters of small construction firms being hampered by cowboy clients.

“Typical cowboy client behaviour can include a demand for the builder to complete tasks not included in the original brief or quote and for no extra payment.

“The worst type of cowboy client seeks to delay or withhold payment on spurious grounds, for instance by discovering make-believe faults.

“Nearly a quarter of construction SMEs have had to wait for more than four months for payment from a client or large contractor.

“Fewer than one third of builders are always paid within the standard period of 30 days and this is completely unacceptable.”

“Late payment is having a direct impact on the ability of construction SMEs to grow and prosper.

“We strongly recommend that builders and clients do everything they can to protect themselves by using a written contract that includes an agreed payment schedule.

“Clients rightly demand a high level of service from their builder but home owners also need to keep their end of the bargain by paying on time.”

Latest news

Beck Interiors files administration notice

Supply chain has suffered delayed payments from £139m-turnover luxury fit out specialist
5 hours ago

Green light for York Central civil service office hub

£60m office project accelerates York Central goods yard redevelopment
2 hours ago

Blenheim House Construction enters administration

Administrators looking at options on present projects
18 hours ago

Profits rise at Esh Group with more to come

Contractor confident about year ahead as market conditions move in right direction
5 hours ago

Piling specialist Van Elle sees housing orders rise 30%

Mark Cutler says firm on course to deliver 10% annual sales growth
5 hours ago

HS2 to spend £100m shutting sites where work never started

Remediation of sites no longer needed for cancelled Phase 2 will take three years
22 hours ago

Willmott Dixon wins £61m deal for new Army dog unit

Contractor to revamp Kendrew Barracks in Rutland
5 hours ago

Stockport advances 4,000-home Town Centre East plan

Council seeks consultants to steer plan for 280-acre area in the city
6 hours ago

ISG sale imminent as buyers set-up UK holding company

South African nutrition entrepreneur and Australian partner primed to take over
1 day ago

CR Construction wins £210m Manchester towers

Construction to start next year on four blocks ranging from nine to 34-storeys
1 day ago

Southern Housing to rationalise supply chain following merger

Firms put on alert for £1.7bn construction framework renewal
1 day ago

Decision delayed on 52-storey Isle of Dogs tower

Hong Kong developer plans 460 flats block next to Millwall Inner Dock
1 day ago

Go-ahead for £850m North London estate rebuild

Flagship Edmonton housing estate redevelopment will deliver 2,000 new homes
1 day ago

Mace lands £184m Oxford Science Park contract

Contractor to build trio of laboratory and office buildings
2 days ago

Worker paralysed in 30ft fall during electricity pylon demolition

Specialist firm fined £240,000 after court hears linesman attached lanyard to a loosened steel section
1 day ago

Sir Robert McAlpine clinches £4bn Somerset gigafactory

2.6m sq ft car battery plant will require over 2,000 workers at peak construction
2 days ago

House builder Hill Group tops £1bn turnover

Group's controlled development pipeline stands at £10bn
2 days ago

Higgins wins 360 new homes job in south London

Firm will now work up planning for phase 2 of Brixton housing project
2 days ago

Kier starts £48m Ealing high school job

Northolt High School to be rebuilt for 1,130 pupils
2 days ago

Plans in for £64m Suffolk A12 upgrade

Work to start next summer on dualling and junction upgrades
2 days ago

Man suffers multiple fractures in HS2 accident

Engineering firm fined after fall leaves worker in hospital for two months
2 days ago

Go-ahead for Milton Keynes’ largest private rental project

Platform_ to build 20-storey scheme of 335 flat next to train station
5 days ago

A2Dominion reins in new-build and cuts development team

Housing association to stop private new build sales in big strategy switch
5 days ago

Sellafield partnership appoints final key delivery partners

Altrad and Kaefer bag £180m access, insulation and painting deal
5 days ago

Health centre canned as build costs double in four years

Devon NHS stands down plans for Health and Wellbeing Centre in Teignmouth
5 days ago

Family confirm death of Des O’Rourke

Deputy chair and co-founder of Laing O'Rourke dies aged 75
6 days ago

Plans approved for major phase of £2.5bn Salford Crescent

Crescent Innovation will help create global research hub
5 days ago

Deal to kick-start 3,000-home Northstowe town centre

Labour Government acts to unlock next phase of new town near Cambridge
6 days ago

Striking new-look for Canary Wharf HSBC tower

Large chunks of upper floorplate to be removed in major overhaul
6 days ago

Kier halves debt to £115m after strong trading year

Order book up 7% to £10.8bn with 85% of work secured for year ahead
6 days ago

Contractor services