Managing Subcontractors

It’s critical for general contractors to select subcontractors that provide high-quality work on schedule and within budget. Finding the right subcontractor at the right price can greatly impact productivity, reputation, and profit.  It can also be a real challenge to obtain competitive bids from top subcontractors and select one with the best skills at the right price, and is reliable and does excellent work.

If subcontractors miss deadlines, or performs poorly, the general contractor will face issues, such as not getting paid on time, or at all, and it could ruin their reputation. Construction superintendents and project managers need to be informed about everything each subcontractor is doing, as well as how it may impact other aspects of the project.

By staying aware, project managers minimize risk and ensure the best possible outcome for the owner and their company. 

Managing the Bid Process 

When bid information comes in from subcontractors, it can be like comparing apples and oranges. General contractors and subcontractors use varying methods to quantify jobs, which can make it challenging to evaluate bids. One misstep could lose the bid, or worse, win the bid with the wrong numbers, which can be an expensive mistake. 

Managing Subcontractor Documentation

Throughout a project, an important responsibility of the general contractor is ensuring all subcontractors have the proper insurance coverage and safety measures in place. General contractors must ensure subcontractors have liability, workers’ compensation and correct bonding in force, and be able to present the documents when and if the owner requests to see them.  

Managing Subcontractors on the Job 

Many things can go awry during a project, including subcontractors missing deadlines, or
not performing their tasks or perform poorly. This requires that general contractors react quickly and knowledgeably. To accomplish that, as well as mitigate mistakes, general contractors need to oversee the work being performed, be provided with regular updates on how the job is progressing and receive critical information if there is an issue or problem that needs to be addressed. If the general contractor is not aware that a problem exists, he risks the possibility that a resolution will not occur in a timely matter, which could result in costly delays.

Managing the billing process the final, crucial step

General contractors need a controller who is aware of vendor billings against subcontracts as well as the subcontractor retention being withheld. The controller must be able to ensure invoices are applied to correct cost codes. Furthermore, the controller should make sure a contractor does not overbill and that subcontractors are not paid if insurance, licensing or bonding information is not up to date.

 

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