Getting paid on cancellation fees and paying your salesman

What have you guys found works best for collecting cancellation fees when you get someones roof approved and then they decide to let jimbobs brother from his counsins aunts church do the work with his wife and take 11 days to do 30 squares and have it look like total dogshit to try and save some money.

Is a letter on my company letter head best or should a retain a cheapo lawyer or is there a better way.

I look at these on a case by case basis and they dont happen that often but the get my salespeople so blacked out that i feel like im letting them down not going after the people.

also, i pay my guys 10% of the contract so how much of the 15% cancellation fee should they receive when we do collect?

thanks in advance?

I think you’re pretty much toast. Really all you can do is threaten them to pay it. There is no judge that will rule in your favor if you take them to court. Sadly any lawyer will tell you the same. The whole thing about our contracts being binding??? Not true :frowning: I’ve lost several that way. Just have to tell your salesman to forget about it and move on to the next one. Good Luck!

Well…

That’s a hard one. First, we need to look @ what the potential downfall is to your co. in regards to how bad it would look if you chased the customer for the $$.

Next, what’s the exact verbiage to your contract?

Start with those two & then we’ll move forward.

we had a customer that insisted on paying it. the sent us a cancellation letter certified mail with the right of rescision form signed and everything.

so the guys commission was supposed to be 932 and we got 1398 from the people.

if you collected it, i would give him half.

[quote=“rsales”]

I think you’re pretty much toast. Really all you can do is threaten them to pay it. There is no judge that will rule in your favor if you take them to court. Sadly any lawyer will tell you the same. The whole thing about our contracts being binding??? Not true :frowning: I’ve lost several that way. Just have to tell your salesman to forget about it and move on to the next one. Good Luck![/quote]

Most of the contracts I’ve seen would likely not stand up in court. However, to make a generic statement as above is incorrect. As long as the state and local laws/regulations are observed, there is no reason to believe your contract won’t hold up in court. The thing to do is to have the attorney you might utilize to represent you go over and approve the contract he might be fighting in court over.

[quote=“Authentic_Dad”]

I think you’re pretty much toast. Really all you can do is threaten them to pay it. There is no judge that will rule in your favor if you take them to court. Sadly any lawyer will tell you the same. The whole thing about our contracts being binding??? Not true :frowning: I’ve lost several that way. Just have to tell your salesman to forget about it and move on to the next one. Good Luck!

Most of the contracts I’ve seen would likely not stand up in court. However, to make a generic statement as above is incorrect. As long as the state and local laws/regulations are observed, there is no reason to believe your contract won’t hold up in court. The thing to do is to have the attorney you might utilize to represent you go over and approve the contract he might be fighting in court over.[/quote]

Authentic is correct.

I have a page (that I can send out to those who will forward me an Email message) & it states something along the lines of:

[quote]*"Customer understands that considerable effort and work goes into activities prior to the actual installation of a roof or undertaking repairs. Not all items will be required for every project, however these may include: Physical work such as sketching and diagramming the roof, photographing and cataloging damaged or affected areas of the roof, meeting with adjusters at the project site, follow up communications with the insurance adjuster either onsite, via telephone or through Email, negotiating with suppliers, ordering product specific to this named job and discussing the project with labor either onsite, via telephone or through Email.

Due to the complexity of these activities that may possibly take place prior to the actual installation of a roof or undertaking required repairs, the customer understands that all contracts are binding after the 3 days ‘right of cancellation’ has expired and any request for cancellation will be subject to a mandatory 20% of the total contract amount (undetermined dollar amount extras for “as found / hidden damage” not included)* listed below."[/quote]

If you frame it like this, in that there IS actual work that goes on before the roof is installed, you’ll fare MUCH better in the courts & also impress upon the customer that they shouldn’t try to screw you.

Good point Ranch Hand, we have something similar in our contract. It is also important to have all people on the mortgage/title sign the contract, notice of 3 day right of rescission, a description of when/how the work will be scheduled, a named person the Homeowner can contact listed and a number of other small items. Some of this can vary dependent upon state and local home solicitation laws. We spent money with our attorney to have him review it.

I put it to the attorney quite simply “You someday may have to represent us defending this contract and since I’m paying you to check it, make damn sure it is defensible.” I think it is worth noting that some common sense has to be applied so the contract isn’t so long and complicated that you’ll scare the Customer off.

That is written up very good Ranch Hand. Instead of just saying “if you cancel you will be charged a 20% cancellation fee”.

half of his normal comission or half of the money. agape, shoot me your email id like to check it out. empirercs@gmail.com

thanks, matt

Empire, I’d pay him ~ 1/2 of the amount collected. What happens if you’ve got a high dollar contract & 1/2 of the commission exceeds the 20% you’re collecting?

i meant 1/2 the amount collected. he did most of the work to get the deal, and obviously the customer felt bad enough about the situation to send the money in… probably assuming the salesmen (who he probably liked) would get some or all of it.

i sent you an email as well.

90% of what is in the first paragraph is what most roofing companies advertise as a FREE ESTIMATE. As for the material??That can be easily sent back and credited to your account. A judge will know this.

Now all of this legal talk sounds great for you right? I guess the biggest question is how much the cancellation fee would be. Is it worth dropping a couple hundred on a lawyer and then paying a court fee. Or wait…you would probably want the customer to pay those as well. So you might make a little money off of this but what your really going to do is jeopardize the chance of having future customers. Those homeowners are going to tell everyone they run into that you screwed them over(church, grocery store, schools, LOCAL NEWSPAPER, etc.) Which we know is not true but they are only hearing their side of the story. Who do you think they will end up not calling when they need a roof??

Like i said cancellations suck but you got to move on. While you or your sales rep. is trying to push this cancellation through you could be selling others. Personally I would only go through with the legal steps if your a storm chaser that plans on leaving town soon and don’t care about your company’s rep in that city.
Good Luck out there and god bless!

[quote=“RanchHandRoofing”]

I think you’re pretty much toast. Really all you can do is threaten them to pay it. There is no judge that will rule in your favor if you take them to court. Sadly any lawyer will tell you the same. The whole thing about our contracts being binding??? Not true :frowning: I’ve lost several that way. Just have to tell your salesman to forget about it and move on to the next one. Good Luck!

Most of the contracts I’ve seen would likely not stand up in court. However, to make a generic statement as above is incorrect. As long as the state and local laws/regulations are observed, there is no reason to believe your contract won’t hold up in court. The thing to do is to have the attorney you might utilize to represent you go over and approve the contract he might be fighting in court over.

Authentic is correct.

I have a page (that I can send out to those who will forward me an Email message) & it states something along the lines of:

[quote]*"Customer understands that considerable effort and work goes into activities prior to the actual installation of a roof or undertaking repairs. Not all items will be required for every project, however these may include: Physical work such as sketching and diagramming the roof, photographing and cataloging damaged or affected areas of the roof, meeting with adjusters at the project site, follow up communications with the insurance adjuster either onsite, via telephone or through Email, negotiating with suppliers, ordering product specific to this named job and discussing the project with labor either onsite, via telephone or through Email.

Due to the complexity of these activities that may possibly take place prior to the actual installation of a roof or undertaking required repairs, the customer understands that all contracts are binding after the 3 days ‘right of cancellation’ has expired and any request for cancellation will be subject to a mandatory 20% of the total contract amount (undetermined dollar amount extras for “as found / hidden damage” not included)*[/quote]

listed below."

If you frame it like this, in that there IS actual work that goes on before the roof is installed, you’ll fare MUCH better in the courts & also impress upon the customer that they shouldn’t try to screw you.[/quote]

I am with R Sales. I never regret the ones I walk away from, just the ones I should have, but didn’t. If there is a problem up front, just think what a nightmare it will be after the roof goes on.

he gets 10% of the total contract so that wouldnt happen. i did a ton of work and one of my managers got the roof approved and actually got the money from the customer.

we dont really chase the money, i let the guys go after it if the customer is a super jackass though sometimes.