How to structure payments without financing your customer’s project

Map cash need before percentages

Begin with the actual delivery plan:

• when labour and subcontractors must be committed;
• which materials are stock and which are bespoke;
• supplier payment terms;
• plant, access and site setup;
• work stages that create measurable progress;
• testing, completion and handover obligations;
• where variations could require additional funding.

Then divide the project into honest payment purposes. Do not use arbitrary thirds if they do not match cost or delivery. Do not hide a large procurement requirement inside a misleading “progress” stage.

Explain mobilisation

Mobilisation is not a magic word that justifies any amount before a stage starts. State what it enables: reserving the start, setting up site, committing initial labour or covering agreed preliminaries.

Customers become less fearful when they can see a purpose, a proportionate amount and the next accountable step.

Make procurement visible

If £8,400 is needed for made-to-measure windows, show:

• the windows or specification concerned;
• supplier quotation or order basis where appropriate;
• deposit or payment requirement;
• expected lead time;
• responsibility for dimensions and approval;
• relevant cancellation or return limits;
• programme dependency.

The aim is not to give away every commercial detail or remove legitimate margin. It is to make the project commitment intelligible.

Link progress payments to defined stages

A progress payment should connect to a milestone with work, criteria and relevant evidence. Avoid relying on a broad percentage such as “60% complete” unless the calculation and contractual meaning are genuinely clear.

When the stage is submitted, explain what has moved and what comes next. This helps the customer distinguish a real review from a request to pay because an invoice date arrived.

Do not front-load risk

A structure that collects a disproportionate share of the profit and low-risk cost before equivalent project value or commitment may feel protective to the contractor, but it makes adoption difficult and can create a dangerous project imbalance.

The better objective is not “get as much cash as possible early”. It is “ensure the job does not depend on uncontrolled contractor credit while keeping the customer’s commitment connected to visible project purposes”.

Use funding states as stop signals, not promises

Knowing that the relevant stage is funded may allow you to avoid starting the next exposure without assurance. It does not mean Assurr should guarantee payment regardless of the contract, the provider process or a valid query.

The commercial value is earlier visibility. In a traditional workflow, you may work for several weeks, invoice and only then discover that the customer cannot or will not pay. In a staged workflow, a missing funding or review state becomes visible before more exposure accumulates.

Variations need funding consequences

An accepted change is incomplete as a commercial record if it adds £4,000 of work but leaves the funding plan untouched.

Before changed work proceeds where practicable, record:

• the price or credit;
• procurement needs;
• milestone allocation;
• programme impact;
• additional funding required;
• what happens to affected work until the state is met.

Do not rely on recovering everything through the final account.

Keep a question specific

If a customer queries one item, respond against that item, its criteria and evidence. Partial approval can distinguish the approved and queried positions.

Approving payment for part of the stage creates a release request for that part. Do not state that Assurr releases or settles the money. Provider processing and contractual effect remain separate.

Do not work through undefined silence

Your contract and project process should explain the review period and next step. No-response cannot mean automatic customer acceptance or approval, but neither should it create endless limbo.

Use the applicable contractual route and seek advice before pausing or terminating work.

The trade proposition

A good structured payment process is not customer control over builder cashflow. It makes customer funding, legitimate expenditure, achieved stages, queries and payment actions visible at the right time.

You should not have to trust a customer for the value of several completed stages. The customer should not have to trust an unexplained request for the same amount.