How to vet your Sub-Contractors...?

Question

Hello!

I'm a contractor in Minnesota and recently my wife got a job in an area about 200 miles away (where we grew up - which means a ton more connections). So needless to say, I'm moving my construction company (once I finish up my projects) down to that same area. For the last couple of years, I've primarily been a one-man show. I do just about everything on my jobs. Currently, I'm 26, so no issues with my health, but I also know that my body can only keep up for so long and I can only work so many hours in a day. So when we're moving into this new area, I'd like to eventually break into new builds, and in order to do that effectively from the start, I'm planning to sub out quite a bit of the work.

So, my question is: How can you tell you've found a quality sub? Are there specific things you ask or look for; or maybe red flags to stay away from?

Additionally, if you have any advice about growing my construction business in general, I would love to hear from you! I always appreciate the advice!

Have a great day!

Justin

Account Closed · Answer

@Justin Puetz. I vet out subs by meeting them on a project they are working on to view the quality of their workmanship. Once I’ve had a look around I will begin asking questions about their processes to learn if they are taking short cuts or performing quality work. For example: how many screws in a board of drywall, how many nails in wood flooring, are they using levels (or framing by eye), is the vinyl siding wavy due to overnailing. I think you get the picture. Additionally, spending time speaking with a potential sub on a job helps me to determine: if I like him, if I can trust him, if he is a quality craftsman, if he can handle the work on my projects, etc.

Ultimately, your final decision is always going to come to hiring that sub and seeing for yourself it you can work together. If all goes well you have yourself a new sub. If things go south on the job, fire him and start the process again.

Fortunately, you are in the business so all this should be real easy for you. You know what you’re looking for. Trust your gut instincts. Good luck in your new location.

Tanya Rooney · Answer

@Justin Puetz

Curious where you are moving to?

I have found a lot of contractors (subs and GC’s) and communication is key for me. I am really candid with people on my expectations for the job and for their work. I try to be diligent on calling their references because I think it’s good to get a sense of the work they do or have done as well as their responsiveness and work ethic. I ask questions about showing up, finishing the job, payments, etc. I let the sub know I am huge on communication and that I would rather they tell me if their bid is going to be late, if they are too busy to bid something or do the work (I respect this far more than someone taking the job and being too busy or doing sub par work because of something). I think being upfront on a lot of things is a good idea and a relationship starts to build. If they bid something and don’t get it it’s a priority to call them (not email. Not text.) and let them know they didn’t get the job and why (timing, percentage of cost over a competitor, etc). That helps with future relationships as they may get the next 4 jobs just not this particular one. I also try to make sure they know they are setting their own schedules (I ask how long something might take them, give them a few extra days and then see if they are good at estimating time..).

Building the relationship is the best in my circumstances. I have some guys that I think genuinely like me so they move their schedules around to get to my projects, which is worth the effort I have put in. Sometimes we need that :)

Looking forward to seeing what you will do in your next town! It’s a great idea to start adding subs to your roster. Build a business and a life you can sustain in lieu of a business that if you get hurt or take a vacation you lose a lot of money. You will thank yourself for it later :)

Tanya Rooney · Answer

@Justin Puetz

I am glad you got something out of my ramblings haha! I think treating subs and gc’s the same really helps. I am commercial real estate project manager (I manage the architect,

General contractor, mover, furniture, etc). Having good relationships with all of my vendor partners is HUGE and that is what I attribute my successful projects to. There are a lot of uncomfortable conversations throughout a project and having a good working relationship really helps. Everyone’s time means something to them so ensuring good communication with all parties helps our. Anytime there is a breakdown in a project it typically stems from a communication issue.

I have asked for pictures of projects but that is tough to judge on. I am a stickler for details and not being able to see it close up is tough. I would like to visit a job site for future projects. I am also going to try with my next GC having them provide client and sub contractor references. How they treat their subs matter and it’s nice to know if they are good payers. My last GC was fired and I found out later he owed a framing company $80k. Thankfully not my project!

Good luck on the move! I am sure you can find some success down there! Rochester would be a good market to get into!

Justin Puetz · Answer

@Julie Marquez - Hey Julie! Thank you so much for your response! I have had some people work for me where I’m the lead on the project and others who handle their portion of the job all on their own. In both situations I’ve had some good ones and some bad ones, way more bad than good unfortunately. But I think your right, it’s more about taking the time to find the right fit and build that trust with them. I’ve been reading a lot of leadership books lately that really lean into that relationship with other team members and it’s definitely changed my view of how to approach everything. Thanks again for your input!

Have a great day!

Justin

Justin Puetz · Answer

@Tanya Rooney - Ha! Yes, in fact I was able to take some valuable advice from each response!

But thank you again, I’ve learned through other friends even outside of real estate, that are in charge of hiring, how they can do a quick background scan to see the person’s history and see if anything crazy comes about. The last thing you want is to get in bed with someone who clearly has unresolved issues (like that $80K). No drama needed here!

Thanks again Tanya!

Jay Chang · Answer

Hiring a good subcontractor can make your life so much easier. Here's what I recommend you do when vetting out subs.

• Ask for references. Talk to owners/contractors that have hired this sub before. Hopefully you hear good feedback
• Check if the sub has done a similar project before. Similar finishes, work, and project size
• If it's a GC, you should visit one of their projects to see if they are managing the job well. This might not apply to subs because the entire job is not representative of a sub's work
• Do a level bid for at least 3 subs using the same scope, and don't just hire the cheapest sub
• Make sure the sub has enough workforce for your project

If you are interested in reading more about construction management, here is my blog post. https://www.biggerpockets.com/blog/construction-management-101

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Brittany Tompkins · Answer

@Justin Puetz Hi Justin I do project management and interior design and have to get sub contractors all the time for clients as well as for my own investment properties. First I also look up their license number on CSLB (what we use in California) I make sure a sub license is valid and up to date before I even call. Most contractors have this on their websites. Once I am sure they have a valid license I call the company directly. I do have to say just like in a job interview I can tell within the first 30 seconds on the phone if I like a company or not based on the customer service alone. Also if the company follows up with me right away I know that they will be punctual on the job site and attentive to my clients. Also a huge red flag is when a sub contractor takes 3 or more days to follow up with myself or my clients. If right off the bat it’s hard to set up a walk through you can just tell it will be like that the entire job. I always ask how big the contractors crew is, how many jobs they have going at once and to see photos of previews jobs if they have any.

Justin Puetz · Answer

@Tanya Rooney - Thank you so much for all the advice! I’m 100% with you on the communication aspect. I do my best to be upfront and honest with my clients, whether it be good news or bad. Communication is key. But having that same level of communication with subs is something I haven’t done very well in the past. It makes total sense, I just have done a bad job of it.

Also, all of the other tips on schedules and references is a good idea too. Have you ever asked to see any of their previous work? Either by walking through a job or seeing pictures?

Oh, and we’re moving to St. Charles, MN! Small town between Rochester and Winona. Love connecting with other MN investors too!

Have a great day!

Justin Puetz · Answer

@Jessica Grewe - We are moving close to Rochester, MN! A small town called St. Charles, about half way to Winona. And thank you for you’re input! I think it does come down to expectations and making sure I’m able to give them what they’re looking for.

Have a great day!

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