Need to get the kitchen renovated and the contractor is asking 70% upfront. What is the avg deposit amount?
For myself, each job tends to be a bit different. On a kitchen project, I would only ask that a small amount of my labour costs be given up front, but much if not all, of the materials would need to be ordered or built. I ask for all material costs up front, or arrange to have the client pay the supplier directly. If materials are being resold to you, your contractor should be charging GST and PST, depending on the rules where you live. The payment schedule should be outlined in your contract, and be agreed upon before signing. Many renovations have a high material cost, and I've learned to never carry these costs for the client. Materials up front or paid directly to the supplier, labour when it's complete.
Anyone who is asking for 70% is giving You good sign to cut the relation while You are ahead. Standard terms for Commercial is 30 days after work has bin installed,as for residential there is no rules,My standard terms are 30% on signing of the contract 40% half way trough the project and 30% on completion of the project.
We are a Contracting company that specializes in renovations, I never heard of 70% deposit, what we offer our clients is a contract signed by both party's, 30% deposit phase 2-30%, phase 3-30% and a 10% hold back, each phase should have a walk through conducted by the contractor showing work completed and how far along, the 10% hold back is a safety net for the client to make sure contractor has held up his end of signed contract, once job is completed and client is satisfied hold back should be released
Hope this helps you,
Good luck with your project!
Beware of this contractor. I have never heard of 70% up front. It is either a three part payment, 30% down, then another percentage half way through the job, then remainder at finish. OR 30% plus pay for materials as needed. Remainder after job is completed.
Good luck with your renovations.
As you can see Meetpal there are lots of variations on the deposit amounts that contractors ask for with their projects.
Here is some great reading that every home owner should review and be knowledgeable about when undertaking a project on their home but out by Consumer Protection Ontario
Be informed to ensure you hire the right contractor for your project.
I have to agree with everyone. I wouldn't give him 70% unless, you really trust this contractor. I usually ask for 30% upon signing of the contract. You do have a contract?? And the rest paid as the job progresses. Payment schedule should be written in the contract.
Have a good day.
Thanks all for the responses.
70% is a very alarming number for me, and would make me nervous especially if the contractor is not close to you. The average deposit for a Kitchen renovation is 20-30% Depending on the size of the project. Most companies have a standard payment schedule and that is always agreed upon between the client and the contractor. We are a renovation company and we specialize in kitchen renovations, and we have never charged a client 70% up front.
All I can say is walk away from this contractor. I feel you are being set up.
My company does major renovations and custom builds.
We ask for 30-35% as a deposit. And then I ask for payments as we go. The large deposits for your contract would be upon ordering the cabinets and counters as I pay about 30% down when ordered. But to give you an example, if your kitchen renovation was a total of 50,000.00, The final payment upon completion would be about 5,000.00 to 7,000.00.
Take care who you contract with. Get referrals. And call the people.
Good luck with your reno.
I do renovations and manufacture cabinets and counter tops. We deal with home owners, renovators and custom builders. Operating in Toronto for last 15 years and have seen variety of customers and dramas so made some business policies.
Our pricing structure is consistent and as follows:
The 70% cost was for Cabinets as every thing is specifically customised to fit a particular kitchen.(say a 12 3/4" deep pantry, extra higher uppers, special accessories Custom colour, stain etc.) Balance amount on delivery for merchandise and Installation charges after cabinets are installed.
We operate on very thin margin so if one customer don't pay as per contract I am done I would like to be safe as I know I am 100% honest I don't want to leave for risk. I don't want be in beggars position.
Particular breed always bargain in beginning, and hesitate to pay full as per contract and agreement and again bargain at the end on final payment. In between lots off extras want for FREE. (There are always exceptions in every breed.)
For counter top we take full deposit at the time of template and install in 5 business days.Counter top if its hot colour we have to procure slab before so at the time of installation its around 6 to 8 weeks from main contract in those cases we request customer to pay for slabs upfront and secure slab.
For construction we take ZERO Deposit in beginning, 10 % on day we start the work, 70% when all rough in is done and balance on completion.
Based on this formula in 15 years I have once faced difficult situation when I trusted Italian builder and did his kitchen with ZERO deposit for his client and never showed to pick up.
Lesson learned lost money, move on.
This is our business policy and don't leave my self exposed for risk. If customers don't trust us we don't do business - I don't want to be in beggars position.
Good luck to all every one is different and so far we have maintained 5 star rating and serve mostly referral business all over Ontario.
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