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What should I look for when hiring a subcontractor?

The Checklist You Need When Hiring a Subcontractor Look for strong performance and credentials. Make sure they are insured. Make sure they are licensed. Ask for referrals. Check to see if they have any complaints logged against them. Ask them about safety. Create a written contract.

How do I find subcontractors in my area?

To find subcontractors, GCs and PMs usually go to sites like BuildingConnected, AGC, BIA, and other trade organizations. Once there, a GC will put out a Request for Proposal (RFP). RFPs list out important project details, like the skills needed, objectives, and the project timeline.

Is it cheaper to hire an employee or contractor?

You can hire independent contractors for less cost long-term; however, they charge higher hourly rates to compensate for their self-employment taxes. 6 A general rule of thumb is that hourly contractor rates are 50% to 70% more than what you would pay a permanent employee.

How do I protect myself as a contractor?

To ensure youre protected from start to finish, always follow these protocols before you hire. Get Proof of Bonding, Licenses, and Insurance. Dont Base Your Decision Solely on Price. Ask for References. Avoid Paying Too Much Upfront. Secure a Written Contract. Be Wary of Pressure and Scare Tactics.

How do you handle subcontractor risk?

Managing Subcontractor Risks Across the Supply Chain Identify and Prioritize Risks. Create a Culture of Risk Awareness. Invest in Liability Insurance. Confirm Supplier Stability. Perform Supply Chain Audits.

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What are subcontracting costs?

Subcontract Costs means those sums properly paid or due and payable to Subcontractors under the terms of the Subcontracts.

How can contractors protect themselves?

Getting the right independent contractors liability insurance in place can protect you from lawsuits, mishaps, and third party property damage that can devastate your business.

How do I find a reputable contractor in my area?

If you are still unsure, you also may wish to check the contractor out with your local building department, trade association or union, consumer protection agency, consumer fraud unit, and the Better Business Bureau.

What is the downside to subcontracting?

Choosing to be a subcontractor can mean a reliable source of work without seeking new clients or being employed by a company. However, it can come with some docHub drawbacks pay may be less reliable, taxes may be more complicated and youll probably have less control over who you work with on a day-to-day basis.

How do subcontractors charge?

As a very rough rule of thumb, the profit for the subcontractor should lie somewhere between 3-5% of the total job, but there is no fixed rule. Where there is some room in your agreement for negotiation is what you consider the margin for profit and what you might classify as contingency.

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