Method of Payment to Supplier

At the first stage, the contractor must first find a material supplier (sub-contractor) that
wish to engage with the business for both mutual profits. The contractor may choose one supplier
for each project or use the same supplier for all of their projects. Then, if both parties are agreed
and achieve a mutual understanding, they might perform a contract. That contract should clearly
justify the promisor and the promise, scope of work, payment, term and insurance to be covered.
Besides, the warranties, safety practices and any relevant details should be mention on the
agreement paper.
Based on our interview session, we found that all pricing listed by suppliers (subcontractors) are given out by a prepared price quotation. Usually, the quotation only valid for 60
days from the date it was issued. And if the contractor wanted to order materials after passing the
validity period, they should ask a new quotation from the supplier.
The contractor must perform all the payment according to the contract formed earlier.
Any delays on payment, the contractor itself must provide a reasonable prove to the supplier
regarding the late payment.
In our interview session, we found that the company makes the payment to its supplier
approximately 50% of the total cost for the material. And after project completion, they pay
another

50%

of

the

material

used

in

project.