PortaPottyBossPro Blog — Construction Site Accounts

Card on File or Net Terms: Choosing How Contractors Pay for Porta Potties

Two Ways Contractors Pay

Construction customers fall into two broad groups. Small contractors, roofers and remodelers usually pay like any other customer: by card, per job. Larger builders and general contractors want a monthly statement their accounts payable team processes, often on payment terms the contractor asks you to accept.

Monthly statements were covered in Monthly Statements for Contractor Porta Potty Accounts: One Bill, Every Site. This article is about the choice itself: when to put a contractor on card on file, when to give them a statement with terms, and how to protect your cash flow either way.

Card on File

With a card on file, the contractor's card is stored securely, and you can charge it when a job is completed or on a schedule. The driver taps Complete in the app, and the charge and invoice can go through automatically.

Card on file works best for:

• Roofers, siding crews and remodelers with short jobs.
• New contractors you have not worked with before.
• Contractors who simply prefer to pay by card.

The benefit is clear. You are paid when the work is done, with no statement to chase. The contractor can update the card themselves in the customer app when it expires or they switch cards, so a declined card does not stall your billing.

Monthly Statements With Terms

Larger contractors often cannot pay per job by card. Their purchasing process requires a statement, approval and payment by their accounting team. For those accounts, set the client to Monthly. They get one statement each month covering every job at every site, each line labeled with the site address.

The terms are your policy. You decide how many days a contractor has to pay, and the software sends the statement and follows up on past-due balances. Be clear about the terms at the start, in writing, and use a custom field on the client to record them so everyone in the office knows.

How to Decide

A simple approach works for most companies. Start new contractors on card on file. After a few months of steady business and on-time payments, offer monthly billing to the ones who ask for it. Larger builders who require statements from the start can go on monthly billing right away, especially if they have a track record you can check.

Ask a few questions before you offer a statement with terms:

• How many sites and units will they have out at once?
• Who pays the bill, and how do they want to receive it?
• Do they have a history of paying other vendors on time?
• What happens if a project stalls or the builder runs into trouble?

The bigger the account, the more a slow payer can hurt your cash flow.

Think about the real cost of carrying a contractor. A builder with twenty units on site and weekly service on every one is a large monthly bill. If that builder pays slowly, you are paying for fuel, labor and chemicals for weeks before the money arrives. That is fine for a builder you trust and dangerous for one you just met. Terms are a form of credit, and you can extend them gradually as the relationship proves itself.

Mixing Both

Some contractors want monthly statements but are happy to have the statement charged to a card. That combination gives them one clean bill and gives you payment without waiting for a check. The customer app lets them see invoices and pay online at any time, and keep their card current.

Watching Past-Due Balances

Past-due follow-up keeps aging balances visible. Check your contractor accounts regularly and act early when one starts to slip. A builder who is behind on one month is easier to bring current than one who is three months behind with units still on six sites. Reports by account help you see which contractors owe the most. Reports by Contractor Account: Knowing Which Builders Pay Your Bills covers reporting.

If a contractor on terms falls far behind, moving them back to card on file before scheduling more deliveries is a reasonable step. It is easier to have that conversation early.

Whatever you choose, write it down on the account. A short custom field or note that says how the contractor pays, and what terms they were given, keeps the office consistent. New staff should never have to guess whether a builder is supposed to be charged on completion or sent a statement at month end.

Protecting Both Sides

Card on file protects your cash flow. Monthly statements make you easier to work with for large accounts. Most construction-heavy companies end up using both, and the right mix depends on your customers. To see both options alongside job sites, rental tracking and the customer app, visit PortaPottyBossPro construction porta potty rental software.