1. Ask for the contact details of your builder’s main subcontractors, carpenter, electrician, painter, etc. Give these tradies a call and find out if the builder is currently behind on payments and if the builder is usually on time with payments or has a history of being late. If the builder is regularly behind on payments to the subcontractors, then this is no good and you should dig deeper. Also, if the builder does not want to give these details out, this is a warning sign. 2. Ask for the contact details of the builder’s main material suppliers, concrete, windows, tiles, etc. Give these suppliers a call and find out if the builder is currently behind on payments and if the builder is usually on time with payments or has a history of being late. It’s the same as above — late payments show poor cash flow management, which is the first warning sign of a builder going bankrupt.
know what their finances are doing and are flying completely blind.
That’s not something you want when it comes to dealing with one of your biggest investments, or your future employment. 4. Ask for the full names of the heads of the building company. All of the directors, partners and main decision makers. Once you have these, employ the services of a solicitor to run a quick check and ensure none of them have been involved with any companies that have been bankrupt previously.
W hen you buy a car, you run a check to make sure it has not been in any major accidents before, so why not do the same with your builder? These simple tips don’t take a huge amount of time and compared to what they can save you from, I’d say they are priceless. m
3. Ask the builder how often they do a cash flow report. Running a building company is very complex as there are huge sums of money coming in and huge sums of money going out.
C ash flow monitoring is paramount and should be getting completed once a week. If the builder is building over 15 homes per year and is only doing a cash flow report once a month or worse, than they don’t
Daniel Chapman, Stroud Homes Sunshine Coast
Hanging around building sites since he was old enough to hold a hammer, it was only natural Dan would follow his grandfather, uncle, and older brother to become a builder. One of the first things you’ll notice about Daniel Chapman is the relationship he builds with those he builds for. When someone’s building a home for you it’s important that you’re both on the same page, and Dan has the ability to deal with both customers and his team with a great professional, friendly attitude.
DANIEL CHAPMAN, STROUD HOMES SUNSHINE COAST It is no secret that the building industry is a tough industry to be in and one of the hardest parts of it is ensuring adequate cash flow so you don’t go bust. I am personally and solely responsible for a group of approximately one hundred staff and subcontractors and their families across the Sunshine Coast so going bust for me is not an option. Growing up on the Sunshine Coast I have seen big builders come and go and I know firsthand the pain this causes to the community. I come from a not so well-off building and tradie family with seven siblings all born on the Sunshine Coast so the seriousness of non-payments from bankrupt builders is engrained into me and being open with you, the depth of this responsibility I now have often weighs heavily on me. By never missing payments I have created a staunch level of trust and loyalty amongst my entire team, and I am confident that if you talk with my trades suppliers and staff you will hear firsthand that I have a steadfast and unfailing reputation for paying on time . T: 07 5444 2521 A: 9 Nicklin Way, Minyama, QLD, 4575
An important question to ask when becoming involved with the building industry is this — how do I avoid working for, or buying from, a builder who might go bankrupt?
Published on Feb 27, 2017
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