Contractor vs. subcontractor

[Jose Godreau]

Hey BP I just wanted to talk about the subtle difference between a contractor and sub-contractor.

Contractor: A contractor is a person or a company that seeks to do business by obtaining contracts and carrying them out. Being a contractor is similar to being a business owner – you negotiate your deals, work for yourself, have your clientele and are rewarded on your own merits. A construction contractor offers a particular suite of skills which he can perform for clients on a contractual basis. As a contractor, you will likely be paid more for work than you would be as a worker because you have put in the effort of finding the customer yourself. Therefore, any profits from contract work belong to the contractor.

Sub-contractor: A subcontractor is a type of contractor. Subcontractors also work on a contractual basis, and they also offer a particular set of skills which they perform for customers. The key point about subcontractors is that they form agreements with the contractor, not with the customer. Subcontractors often specialize in one specific area of construction and try to network with contractors who negotiate for larger jobs that include this area of specialty. In this way, a successful subcontractor will always have work, thanks to their network of contractors.

I work mostly in South jersey but this information is applicable in NJ, North Jersey, and the surrounding areas. Let me know of any experience you've had with contractors/Sub-contractors whether it be Good or bad below.

[Dominic Bouchard]

Your definitions are not totally exact @Jose Godreau. 

Sub-contractor can also form agreements with customers. Lots of sub-contractor do actually. Contractors often use sub-contractor to find them client in exchange for a commission or other monetary exchange.

The "main" difference between contractor and sub-contractor is who pay who. 

Sub-contractor will receive money from the contractor and the contractor from the customer. In some other cases, sub-contractor "may"also have subordination relationship with contractor and none with the customer directly wich is also different from the contractor side.

There are other differences, especially legally.

But I think it adds to your statement.