Partially paid knives, what's your policy?

PEU

PEU

Gaucho Knifemaker
Joined
Aug 6, 2006
Messages
1,162
I'm sure I'm not alone on this one.
A customer sends an advance payment towards a knife and when its finished , on time I may add, delays for months the balance payment, what do you guys do in this situation?
[edit] let's make this general regardless of current COVID situation.
Thanks

Pablo
 
I refuse advance payments to avoid the situation entirely. As well as refusing commission requests on things I don't think would be salable to anyone but the individual commissioning it.

If the knife is salable and you believe you've given them the benefit of the doubt long enough, I would refund them and put the knife up for sale.
 
Taking orders was a PITA. Going into my second year of making what I want and putting it up for sale. If a repeat customer wants another knife I let them know what’s in the pipeline and he has first right of refusal. No worries, no problems, don’t foresee ever going back to that.
 
If you can't talk it out in this one case and if this things repeat, I would consult a lawyer and develop a strict policy/general terms that you can share with your clients and can be upfront about with your (international) clients such as applicable law, termination of contract, delay in payment, down-payment as such. It's sounds like an overreaction, but if this is your bread and butter business I wouldn't dwell on it.
 
I’d do what kuraki said. If it’s salable I’d give them a decent amount of time to claim, otherwise refund and put up for sale. If it’s uniquely customized, no refund and still up for sale.
 
I'm in the same boat as kuraki. I've refused a number of "partial" or "up front" payments in the past. Part of it is to avoid the situation you're in, but it's also to avoid the other end: If something happens and I can't finish a knife for some reason, or if I get delayed an extra month or two, or ten, there's not as much obligation on my part.
That said, I've had at least a couple of customers in the past, that when the knife was finished on time (or even ahead of schedule), they fell off the face of the earth, or all of a sudden had something happen that meant they were no longer able to pay. In each case, I just list the knife (or knives) for sale else where and that's that.

There have also been times that I sat on a knife for an extra month or two to try to give a customer a chance to pay, but if you can't, or simply don't want to, I don't see the problem in listing the knife for somebody else to buy, and then refunding the original customer before or even after it sells.
 
Make sure you are actually reaching them, email, phone, snail mail, whatever make sure they are just ignoring you.

Registered letter sounds like a good idea, but it's expensive for you fifteen bucks or so. Also if they have money troubles they are not going to accept that either.

then give them a thirty day notice and sell it.

If you can't reach them, or recover all costs, keep the deposit.


Just selling household stuff on craigslist, at least half are tire kickers entertaining themselves with no ability to pay or pickup.
 
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I wouldn't have accepted a partial payment. Nothing good can come from that.

If it's just a matter of waiting a few months for the guy to come up with the funds and he actually communicated that to me, I would hold the knife for him until he could pay.
 
Mitchell Knives said:
I wouldn't have accepted a partial payment. Nothing good can come from that.

If it's just a matter of waiting a few months for the guy to come up with the funds and he actually communicated that to me, I would hold the knife for him until he could pay.
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I run Auto Service and almost all time I have for sale several used cars .Cars are mine .So you want to bye one of them and we make a deal. Since you don t carry with you all needed cash , you will give me an advance...200 -500 euro for example with condition that I will keep that car for you until the agreed deadline when you need to give me rest of money .If you don t do that you lose advance you give to me .If i sell that car to someone else before your deadline , i give you back advance which you give to me BUT doubled .It works !
 
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I don't take money up front. I check in with the customer before I start, which is usually around 6 months after initial order. This gives them a chance to back out or get the cash together. Payment in full due before it ships. If I don't get a response within 2 weeks I sell it to the next person on the list that has that design ordered.
I make a limited number of designs and usually have multiple orders on the waitlist for any given model so if someone dissappears on me its not really an issue.
If I was doing special custom builds for people it probably wouldn't work.
A partial payment is a deposit. If you can't reach your customer through the same means they used to contact you, I would consider the deposit forfeit after a month.
 
Thanks for the opinions!

In my particular case I like to take 50% of the order because its a constant stream of income that makes my life more predictable money wise and I can plan ahead of time without thinking if a customer will buy the knife he wants 6 months after agreeing with me.

And with the inflation we have here in Argentina, November alone was 3%, yup, you read it right, it's also a selling point because the customer ends paying less if you measure the final cost in hard currency (IE USD or Euro)

Pablo
 
I only accept payment once a customers has inspected and accepted the knife but im a hobiest. I'm also strict on the knives I make so I someone backs out I can still sell it. I have a policy on my website that I don't make zombie killers or video game knives because I don't want to get stuck with some ugly useless monstrosity.

I'm actually trying to build up an inventory so I can do some shows
 
While I understand the most of the opinions here that appeal to sain reason, I would stress the importance of having general terms for the advance payments you take, especially since it is the basic financing model of your business. As a (unqualified) lawyer in a EU country I would tell you that you entered in a contract with your customer and that the default of the buyer may have different consequences depending on the applicable law (and if the buyer is a consumer or a business). Also international customs and different national laws could provide for different understandings of what happens with deposit if the contract is not fulfilled by a customer.
 
PEU said:
In my particular case I like to take 50% of the order because its a constant stream of income that makes my life more predictable money wise and I can plan ahead of time without thinking if a customer will buy the knife he wants 6 months after agreeing with me.
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No offence mate but you and I will never do business. I refuse to pay upfront for a knife. I have been burned too many times.

Taking upfront payments leaves you just as vulnerable to currency fluctuations. If you have to refund a customer and the currency has gone against you, you are in trouble.

If you have an injury and you cannot make knives for an extended period and all your prepaid customers demand refunds......you are screwed.

What you should do is work on a customer list, not an order list.
So if I want a knife from you I put my name on a list and only when you are a week or so away from my build do you contact me, ask what I want and confirm the price at that time. Then if I have not got the funds to pay for it I can decline, no harm no foul.

Prepayments are a terrible idea for both knife maker and customer. Don't do it.
 
I would word it as a cash deposit that is applied to the future payment of the knife. That way the deposit is lost if the knife is not paid in full 1 month (or whatever time limit you decide) after completion. You can make good faith judgement calls as needed (such as covid situations). Then you have a level of commitment from them before investing your time and if things go south you keep the deposit and try to sell the knife to someone else. I would either establish the deposit contract via email or have them sign off on a hard copy. Good luck.
 
Steven65 said:
No offence mate but you and I will never do business. I refuse to pay upfront for a knife. I have been burned too many times.
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No problem, no hard feelings, there are plenty of excellent knifemakers here for you to choose from here in the forum :)

To be clear, I consider myself a successful knifemaker, can live from what was once a hobby and live well, been doing this for many years in a country with 40-50% inflation, so currency fluctuations aren't a thing for me, they are just part of normal life...

Regarding paying upfront, my most valuable asset is trust, I built it over the years delivering what was promised on time (give take a week or two :D)

What prompted my to post was an unusual and rather expensive knife (photo) sold to a customer overseas, half was paid, half is outstanding, it will be sorted out sooner (hopefully) or later. What I've learned is that I do business differently than mostly of you guys, food for thought. Thanks

Pablo

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