Subcontracting is a kind of guarantee of expanding your business, providing customers with construction services almost without limits. That is why most contractors enlarge the range of available options for their clients.
At the same time, more and more willing subs appear in the market as narrow-direction specialists hired from one order to another. Most building companies consider cooperation with subcontractors the same actual trend as using construction bidding software for automation and digitization of most processes.
Working as a subcontractor, you will be able to regularly receive new orders without having to look for your customers. When cooperating with the general contractor, it is necessary to maintain clear communication and work seamlessly with each other. But it does not mean that subcontracting is lacking in weak spots. There are advantages and disadvantages to consider if you are a result-driven contractor.
Pros and Cons of Subcontracting
Let’s start with the strengths and benefits that subcontracting can bring to contractors. First, this is the transparency of business relationships. While using building estimating software and other digital tools for enhanced communication channels and improved interactions with individual specialists, the present-day contractors can control each stage of the subs’ work and achieve satisfactory results faster, more cost-effective, and risk-free.
This is about the blend of digital-friendly solutions and the attraction of narrow-direction experts to provide specific services and meet customers’ expectations. Among other advantages of subcontracting for contractors to take into account are:
- Sped-up on-site processes and the opportunity to cover more tasks at once;
- The possibility of offering an enlarged range of construction services to clients;
- Cost-effective collaborations with individual specialists.
Speaking about subcontractors, they can also count on the benefits in the context of their career and professional background:
- You can work in the company without the risk of losing freedom of action;
- The reduced level of responsibility, resulting in flexibility in work;
- No taxes – the company pays everything while hiring you;
- The reduced liability for legal obligations;
- Obtaining specialized experience due to regular orders;
- Increased productivity of the individual specialist.
However, this work also has some disadvantages. Subcontractors and contractors should be ready for the lack of teamwork and poor communication background. When the worker is on the staff for a long time, it is better to interact together. In this situation, any human factors can take place and harm the required procedures.
Tips for Subcontracting
To work under a subcontract, you need to pay attention to several things. First of all, specify the scope of work in the project, what is included in the responsibilities, and all the details of the work. Another important issue is compensation for the work done. Payment can be per hour or project as a whole. You need to know how to pay.
The subcontractor must be licensed and have the necessary skills to do the job well, otherwise, it will lead to problems in the project. In the paragraph on protection and compensation, guarantees in case of unforeseen situations from the actions of the subcontractor should be indicated – its limits of responsibility in the project. A non-disclosure clause is also required, which will protect against leakage of received data by a subcontractor, which can harm the company.
When You Offer Your Services as a Subcontractor
The general contractor must pay the employee according to the law. Your payment is independent of whether the contractor has received transactions from the client, the pay-as-you-go principle. All the financial regulations should be met by both parties.
Also, the through-flow clause states that whatever the general contractor has agreed to regard the project must also be part of the agreement between him and you. The problem is, by signing this, you don’t know what you’re agreeing to unless the contractor shows you all the contracts they signed. Remember that you can only take responsibility for damages if the fault lies entirely with you. Under the contract, you do not have to pay damages caused by other employees.
Subcontracted Insurance Options
Working with construction bidding software, each subcontractor will be able to insure themselves against civil liability risks. This is necessary to protect yourself if something goes wrong. In the case of a client filing a lawsuit, there are two ways out of this situation.
The contractor may add the subcontractor to the company’s insurance policy, or the subcontractor may purchase their insurance. It will also be useful to get the insurance that will meet your requirements and cover all the risks associated with the profession.
