Well I sure hear you about construction clients not paying - this was exactly what happened to us when we were doing construction cleaning for GCs and builders that ended up going out of business without paying any of their subs!  Really frustrating, especially when we weren't able to lien the property since we didn't actually "install" anything. 

 

This is actually one of the main reasons we started doing more of the foreclosure cleanup/property preservation services and eventually moved away from doing work in the construction industry. 

 

One thing that we'll often do when working for a new or smaller asset management company is to ask THEM for references from their other subs.  They want us to be "prequalified" and so we've learned to turn around and "prequalify" them as customers in the same way.  We check at their payment status for at least two of their other subcontractors...

 

We ask them things like, "Do they pay on time?", "what is their payment schedule like? 30 days? 60 days?", "Do they treat you fairly and pay the full invoice amount?"  You can get a pretty good idea about the probability you'll be paid by making a few of these calls.

 

Another good idea is to let them know upfront that you'll do a maximum of X jobs before recieving your first payment check (i.e. 3 jobs, for example).  Just let them know that it's your policy with new clients to do a maximum of X jobs or $XXX worth of work (say, $2500 or whatever you're comfortable with) prior to your first payment.  Afterwards you can lift the constraints if you feel comfortable with their payment history.

 

A third thing you can do is spread your work over a few different clients so you don't "have all of your eggs in one basket".  That way, if one customer doesn't pay you, at least the revenue from another paying customer can help to offset this expense.

 

Right now we're at the point where we simply don't do work for clients that don't pay within 30 days.  We've learned the hard way that it's worth only doing work for good quality clients - a poor quality/non-paying customer can absolutly ruin a small firm starting out and it's not worth going out on a limb for firms that aren't going to pay you.  The work we do is back-breaking, dirty, and stinky ... and that's why we charge a premium for services and only work for companies that appreciate an honest, hard-working subcontractor by paying them in full and on time!