Building solid relationships between construction project managers and subcontractors is foundational to delivering a successful construction project. To put it more simply, a good relationship has the power to make or break a project. This statement is especially true, considering that the contribution of subcontractors to the construction process can account for as much as 90% or more of the total value of a construction project.
Forging strong relationships with construction project managers and subcontractors can also be an essential differentiator for general contractors in a highly competitive construction market. Building and maintaining relationships with subcontractors improves job performance, increasing the probability that the project will be delivered on time and within budget – project success metrics that go a long way toward enhancing a GC’s reputation.
Construction remains one of the most heavily regulated industries, with a need to maintain compliance at all times. Beyond the contractual and subcontractor agreements with construction project managers, project owners, subcontractors and general contractors need to consistently keep tabs on building codes, insurance, bonding requirements, credit, and background checks, prevailing wage and union payroll requirements, lien requirements, and a plethora of safety regulations and much more.
The complexity of construction projects today creates an imperative for streamlining workflows, making communication more efficient, and increasing real-time access to critical documents and transactions – all factors that can fuel a successful partnership between general contractors and their subcontractors.
3 Ways Subcontractors Help Project Workflows
Speed up the completion of large projects.
Subcontractors provide the additional workforce to the main project team, so the work gets done faster. Simple as that. With many subcontractors having different specialties, GCs who hire the right subcontractors for those specialties can complete a project more efficiently and with quality.
Provide cost-efficient solutions to lack of labor.
Subcontracting is often more cost-efficient than hiring new crew members. Employees of a construction company are usually given salary and benefits, while subcontractors are hired as a third party and work on a budget agreed upon with the general contractor. Subcontractors help eliminate the risk of hiring laborers who might not have complete knowledge or skills doing construction jobs.
Provide specialized knowledge.
General contractors aren’t experts in everything. They need the advice of experts in a field they aren’t familiar with. This makes problem-solving much faster. Mechanical engineers, for instance, are the best people to tap for HVAC, elevators, and escalator concerns. Electrical engineers are best at solving electrical design issues. Meanwhile, masons are best at giving insights on proper walling and bricklaying inquiries.
With how much subcontractors help project workflows, it’s best to have great relationships with them to complete projects on time and with quality. Having qualified and efficient subcontractors increase general contractors’ competitiveness in the business. With them, construction businesses can improve their credibility, which often results in winning more projects. Likewise, subcontractors need projects from general contractors so they can make their business more profitable faster.
5 Easy Tips to Building the Subcontractor Relationship
Subcontractors are the most valuable assets on jobsites because they are essential resources with specialized skills and experience to complete projects. They help general contractors stay profitable and, in turn, receive much-need jobs.
So it’s wise to keep a healthy, mutually beneficial relationship with subcontractors. After all, each party needs the other. However, managing subcontractors is difficult, time-consuming work. Done right, it creates long-lasting partnerships with the best talent in the market. Done wrong, it can lead to a chaotic jobsite and frustrated subcontractors. The key to building great relationships with subcontractors is communication. So before signing any subcontractor agreements, make sure everyone is on the same page. Here are ten tips to follow to keep a strong relationship between general contractors and subcontractors.
1) Start strong with the right people.
Seek out and hire the best, most professional subcontractors available, and a general contractor is almost guaranteed to spend less time managing them. Before soliciting bids from subs, review prequalified subcontractors and remove those that do not have the right amount of experience or resources for the size and scope of your project. Ensure they are qualified for the job by checking records such as scheduling, workforce, and safety. Finding the right talent now sets general contractors up to create lasting partnerships based on mutual respect. Most importantly, look for subcontractors using modern technologies and up-to-date software rather than relying on manual processes, as many clients are demanding modern approaches and real-time data that some contractors may not be able to provide quickly.
2) Establish Communication and Transparency.
This is key to ensuring the GC and subcontractor are on the same page going into a project. Ensuring that everyone knows what the expectations are and the expected outcomes of a project will help subcontractors and GCs finish the job efficiently, on time, and with quality. When choosing a subcontractor, all of their roles and responsibilities should be written into the subcontractor agreement. Terms and conditions should be clearly defined, including project specifications, expectations, timelines, and all aspects of remuneration and payment methods.
Collaboration and transparency are the glue for any successful construction project. Keeping your subcontractors consistently in the loop with project changes, working with real-time data and systems, and delivering information ahead of schedule will go a long way toward ensuring that all team members are working from the same page.
3) Have Trust and Reliability.
Trust and reliability go both ways. The general contractor must trust the subcontractor to perform as promised, from showing up on time to performing at the highest quality. The sub also must trust the GC to provide accurate information, including detailed construction documents and reasonable expectations. Both parties also need to be reliable. A GC must rely on the sub to meet the schedule, complete the scope of work as agreed upon, and follow the project guidelines. While the sub will depend on the GC for supervisor communication, including RFI responses, change order approval, and meeting payment terms.
4) Experience can help win repeat business.
The subcontractor and general contractor relationship must be built over time, working on various projects and fine-tuning how the team operates. Subcontractors should be experts in their trade, have an excellent reputation, and perform quality work. Even with a solid safety track record and strong financials, GCs often prefer subcontractors who don’t leave behind a mess or create more noise than necessary on the jobsite. On the other hand, general contractors should know how to do a job themselves despite hiring subs. They are the ones that take responsibility, schedules the work, and ensure that every subcontractor completes their tasks on time and to the highest level of quality. By building experiences together, both teams will have the best opportunity for success.
5) Use construction software to streamline processes.
Since a crucial part of ensuring compliance and project quality is the documentation, it’s essential to have a fluid system of record-keeping. Consider implementing an integrated, cloud-based construction management solution that expands access to the entire project team, including subcontractors. Allowing them to access and enter their data, see real-time project information and automate workflows for processes like time collection, invoices, change orders, purchase orders, and more will help deliver more productive higher-quality work.
Subcontractor Collaboration Platform by RedTeam
Unfortunately, many contractors still rely on physical paper, file cabinets, and other archaic means of document and data collection. These are not ideal methods as documents can take longer to find and can get lost. Cloud-based construction software features powerful document management functionalities that allow contractors to go paperless and guarantees a secure location for documentation and documentation tracking.
RedTeam’s subcontractor collaboration platform, TeamPlayer, helps streamline workflows between subcontractors and general contractors, making communication more efficient and increasing real-time access to critical documents and transactions. All of which can fuel a successful partnership between both parties.
The application was created to help improve the contractor relationships by providing project information, managing a common SOV, streamlining communication, and facilitating critical workflows.
How It Helps Subcontractors
Subcontractors gain instant mobile access to construction project details, including the status of their contracts, change orders, credentials, lien waivers, submittals, and punch items. The app helps streamline communication and facilitates critical workflows such as bidding, negotiating, contracting, compliance, and billing.
Our subcontractor collaboration app acts as a data entry point into RedTeam because it allows subcontractors to respond to numerous documents, reducing error and speeding processes. Everything subcontractors need to do on a job is now on a mobile device. The app provides visibility to all documents from general contractors and other subcontractors so that any contract agreements, invoices, and payments can be accessed with the click of a button.
No more research. No more wasted time finding information about a specific agreement or document. Everything a subcontractor needs is accessible in an instant. Now subs can quickly determine an entire relationship with a general contractor using a mobile app.
TeamPlayer’s Electronic Applications for Payment (eApps) simplifies invoice creation and submission, streamlining the subcontractor payment process and getting subcontractors paid faster.
Once a subcontractor submits an invoice, they have an instant notification that the GC has received the invoice. They are also notified as soon as they receive payment. This feature on TeamPlayer enhances communication between the GC and subcontractor by reducing wasted time on both parties to figure out if an invoice was created, when, where to find it, and when payment will occur.
The subcontractor collaboration platform also offers AIA-Style Progress Billing allowing subs to create and submit this form of billing to customers, including contractors not using RedTeam.
How It Helps General Contractors
The standard manual method for GCs was to create their documents when they had time. Now, with TeamPlayer, they can create documents electronically using the mobile app. This reduces risk, leaves no room for errors, and speeds up the process for GCs to save crucial time. In addition, the app acts as a lens to give better insight into what subcontractors are doing.
TeamPlayer offers better management and control for general contractors by providing access to critical information in real-time, no more chasing a ghost to find necessary documents. Instead, just log into the app and see what you need in an instant.
The app provides visibility to all documents from general contractors and other subcontractors. In addition, any contract agreements, invoices, and payments can be accessed with the click of a button, thanks to the cloud-based software.
Using technology like this can help general contractors enhance their working relationships with subcontractors. A strong relationship between general contractors and their subcontractors translates into successful projects, which leads to more opportunities which, in turn, leads to a mutually profitable long-term relationship.