Siouxland, Sioux Falls, SD

  • 1.  Vendor Pay Terms

    Posted 02-05-2018 17:48
    All - 
    I am hoping to determine what industry norm is related to payment terms to materials vendors and suppliers (who you are doing business with under purchase orders)? I know it is common to pay subcontractors under "pay when paid" or "pay if paid" terms, but I am curious if anyone has similar pay terms for major material suppliers, or if the industry norm is net 30 (or other terms not driven by owner payment)? 
    We try and push as many payments on projects out until we are paid by the owner, assuming we have prompt payment from the owner. However, we do make exceptions at times for owners who do not pay timely.
    Thanks in advance for your feedback!

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    Arin Knudtson CCIFP
    Chief Financial Officer
    Journey Group Companies
    Sioux Falls SD
    (605) 332-5968
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  • 2.  RE: Vendor Pay Terms

    Posted 02-06-2018 10:33

    Hi everyone,

     

    From a material suppliers perspective, our accounts receivable are net 30.  If a customer elects not to pay within 30 days they are charged finance charges.  Almost all of our customers pay within the 30 days and if they don't, most of them readily pay the finance charges.  This is our policy as we have to pay our major material vendors within 10 days (asphalt oil) or 30 days (cement).  All of our other vendors having varying terms between 10 and 30 days.  During the busy time of the year, our cement and asphalt oil bills total more than $2M.  If we don't have the cash available, we borrow money from our bank on a line of credit.      

     

     

     

    "A man can be as great as he wants to be.  If you believe in yourself and have the courage, the determination, the dedication, the competitive drive ... it can be done."- Vince Lombardi

     

     

     

     

    Kevin J. Moore, CPA, CGMA

    Chief Financial Officer

    Concrete Materials

    1500 N. Sweetman Place

    Sioux Falls, SD 57107

    Tele # (605) 336-5772

    Cell # (605) 759-3050

    Fax # (605) 334-6221

    kmoore@cmcsd.com

     

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