Advance payment for the window installment

This is actually a bit confusing. I pay the money to the general contractor, who then pays the window dealer. If the window dealer goes bankrupt, the general contractor should still be liable to me with their own money, right? If I apply for this self-debtor bank guarantee, should the GC provide it to me or to the window dealer?

Secondly, you still haven’t understood: the completion guarantee is not to secure any third party – certainly not a subcontractor or any other auxiliary of your contractor – but for you, to ensure that the house is completed if the contractor is no longer able to do so. And first of all, abandon all dreams that you could negotiate this guarantee retroactively. Insolvency law dances on the backs of the “little man,” but you won’t get that risk ironed out anymore now.

It is a small family business. The owner and contact person is the lady I speak to.

Female owners of construction businesses do exist, very rarely, and then mostly daughters of the owner whose father founded the company. They are also regularly so solidly positioned that there is little cause for concern. Much more often – especially where there is reason for concern – a Mr. Four-And-A-Half-Time-Bankrupt uses his secretary/life partner as a figurehead. It is part of the nature of a general contractor contract to be a kind of “hidden adoption,” where you regularly don’t even learn the actual service providers / subcontractors / auxiliaries – in any case, these and you legally have absolutely nothing to do with each other, meaning no direct (counter)claims or obligations. Payment schedules are typically and purposefully designed to remunerate the contractor for the deliveries and services already provided (even if not yet “accepted”) and to provide liquidity for advance performances (also advance payments by third parties) for the next steps. In this respect, the proposal “give me already the money for an item of the step after next” is an indication of liquidity shortages (of the GC). A GC usually keeps the exact supplier open until shortly before the order is placed – precisely to take advantage of better purchasing opportunities. Passing on such purchasing benefits is highly unusual. As a former window manufacturer (aluminum) and then dealer (also PVC), I can tell you that special price promotions between manufacturer and reseller are common with many manufacturers irregularly about three times a year. The main motives are inventory management and company holidays, but also upcoming product improvements. Occasionally the windows get “to party along,” when the front door panel collection is changed. Except for product improvements – as a dealer you should always communicate discontinued models honestly – I would have never ever passed on such a purchasing advantage to a first customer (which you are as a private homeowner), let alone pass it on in full.

Advance payments or overpayments are simply the reason for financial existential fears of builders when the general contractor or another major trade botches work or goes bankrupt. Entire TV formats are based on this cardinal mistake.

Fundamental mistake

That the builders have existential fears is a "fundamental mistake"? I don't understand. Can you explain that in more detail?
By the way, I had a similar problem with an electrician who wanted the full amount for the upgrade options I chose (almost 10K) immediately after the rough installation. Such an amount is not necessarily lying around in everyone’s checking account. That can really freak you out...

I kicked out the door guy of my [GÜ] when he wanted all the surcharges paid in full immediately in advance (delivery would have probably been 9 months later at that time). It was only about 1,500 EUR, which I would have had, but I didn’t want to support such business practices. I then ordered all the doors online and installed them with my father-in-law. In total, I even saved 900 EUR (with a credit from the [GÜ]).

That the builders have existential fears is a "cardinal mistake"? I don't understand. Can you explain that in more detail?
By the way, I had a similar problem with an electrician who wanted the full amount immediately after the rough installation for the upgrade options I chose (almost 10K). Such an amount is not necessarily available in everyone's checking account. That can really stress you out...

It’s not the existential fears that are the cardinal mistake, but making those advance payments in the first place.
I once mentioned shoddy workmanship in construction as a TV format. I already stood there tearing my hair out several times when builders (I hope that’s just scripted) claimed they had already paid the full house price, while only a botched shell of a building was standing.

With the OP it’s hard to assess.
I also have a small general contractor, and he would be the type of person to pass something like that on to us. For example, we have tiles in the contract up to price X. When choosing tiles, expensive ones can still work without extra cost if others underneath are cheaper. He basically settles accounts with tiles that are below amount X. He doesn’t have to, but he does.

But the other kind of general contractor, namely the one with the straw man who founds the fifth company for the bankrupt builder, also exists.
And from afar, we cannot assess which category the company falls into.

That the builders have existential fears is a "cardinal mistake"? I don't understand. Can you explain that in more detail? By the way, I had a similar problem with an electrician who wanted the full amount immediately after the rough installation for the upgrade options I chose (almost 10K). Such an amount is not necessarily sitting in everyone’s checking account. That can really make you panic...

I explained it in more detail. But you do have to read the sentence to the end.