Deposit for special orders?

[melogic]

I am working on an order for a customer for 50 pens. Each with a maple box with a logo laser engraved on the box only. Is it too much to ask for a deposit? How much of a deposit?
Within the next month or so, an order for around 300 of the same will be confirmed with the same customer. Thanks in advance for any and all input.

 

[DCBluesman]

Mark--for large orders, I require a deposit equal to 100% of my direct costs. Then I get paid the rest on a percentage basis as I deliver the finished pens. I've got a 100 pen order that I'm just finishing up and the folks I'm dealing with had no problem at all, after I delivered a sample pen for them to examine.

 

[mrcook4570]

Now that's quite an order. I would either get a deposit or a contract, otherwise you could be eating those pens for dinner. Most of my customers choose to pay in full up front. If they don't, then I require 50% down. Unless, of course, I know them.

 

[Dario]

WOW!!!

I agree get atleast 50% of teh agreed amount or 100% of your material costs. Either way they will really think hard not to get the pens. If they don't you are still not down the hole.

If you ever need a sub-contractor just let us know. [][][}]

 

[chigdon]

I also get a deposit on larger orders of an amount that will cover my costs. I think that this would seem fair to almost anyone out there.

 

[melogic]

Thanks guys for all of the feedback. These orders are for a local University.

 

[wpenm]

Mark, I agree with the others. I get a payment up front for half. Once you have established a good working relationship with a customer, then you can fill orders for them without the need for a deposit. I have a couple customers that place large orders and I never ask them for an advance because the trust is there.

 

[Tangboy5000]

If it's for a university, then definitely get the money up front.

 

[Mac In Oak Ridge]

What would you do with 50 engraved boxes if the University administration decided they didn't want to spend the money after the order was placed? No way would I take an order like that without covering all the upfront costs that you have. If 50% won't cover that then you aren't charging enough. But get your raw material cost up front. Boxes, engraving, kits, blanks, finish materials, and shipping costs.

 

[Old Griz]

One other thing... if you are getting a deposit on an order that size to cover your initial expenses... make sure it is a <b>non refundable deposit</b>, especially on personalized item. IF they bag out on you at least you have the intial investment covered.

 

[Rifleman1776]

Absolutely, get a deposit of about 50%. Sometime back someone here gave a sad-sad story of how a customer backed out after the fact and there was no deposit or contract. I am negotiating with a customer to make 50 finial duplicates of an antique original. You betchum I'm getting at least 50% up front.

 

[Mikey]

50% non returnable deposit for orders is the norm with many businesses on custom stuff. Also, write into the specs or contract that there is no cancellation after a certain date. With the final cancel date in there, you can wait uintil then to get all the stuff engraved in case of a problem. This also allows them change orders on the items without hassle to you. (drop a name, change design etc)

Do not ask for deposit equal to your cost as this can change from order to order and would require much calculation on your part. It also does not take into consideration any time you have already put in. In addition, it is confusing for the accounting departments at times when check requests are done.

 

[wayneis]

Usually I would say get a deposit but it sounds as though the deal has already been agreed on so to me its too late to go back. I don't think that I would risk that next order that you say is coming up. BUT, for all orders after this I would certainly get a deposit up front, most people would expect this.

Wayne

 

[ed4copies]

As the father who paid the tuition, my kids were never allowed to take a class until the bill was paid-IN FULL. If you ask them for half, you're a lot more reasonable than they are!

 

[melogic]

In the initial meeting a couple of months ago with the University we discussed that a deposit of about 50% would be required when the order is confirmed. So this will not come as a shock to them. At that time, the dean did not seem to have a problem with this. I just basically wanted to know what the norm is and what everyone else is doing.

And yes Mac, 50% more than covers the cost, so I guess I'm charging enough. Thanks again everyone for all of this valuable information.

 

[Ron Mc]

Mark,
I have filled a large order for a University and I required 50% down. They didn't have a problem with this at all. Be sure you get a P.O. from them that lists the full dollar amount and not just the 50%. Keep in mind that it may take a while to receive final payment after delivery of the pens due to their check cutting schedule.
Good luck and Congrats!