How to find great subcontractors

Hey guys, I decided to post some tips I have picked up from flipping full time in Kansas City, Missouri. If anyone else has great tips please share them also.

Finding great subcontractors. This is really tough when you are starting out and I get asked this question a lot at my local MAREI. Here are a few things to look for by trade:

Electricians and plumbers: They should be a master tradesman and willing to pull permits. I have found the sweet spot are businesses that have been around 5 to 15 years and are owned and run by two to four master tradesmen. Additionally, these companies don't have fancy uniforms, huge logo plastered trucks, or a brick and mortar building. Typically they have embroidered polos, a truck with their logo on it but maybe only one or two of these vehicles that are personally owned not owned by the company, and they have a small office where one person coordinates everything. These guys are who you want to call. Their prices are low but their quality of work is the same as the big guys but for a fraction of the cost.

How do you find them? Call around. Ask other local investors. If you know of a large plumbing or electrical wholesaler/warehouse that sells direct - go ask them who is the best.

*Please don't skimp and try to get a handyman to do the work that a master tradesman should do to save a buck. If you need a permit for work - have it done right. Reputation is everything in this business.

HVAC - if a HVAC company is putting up billboards and/or has radio/tv commercials spots - don't call them! (I repeat, DONT CALL THEM! How do you think they afford all that advertising?) A good price in KCMO for a 2.5-ton unit furnace, coil, and condenser installed is 3k. If you call the "big boys" they will charge 6 to 8k for the same units installed. Same as above - look for smaller companies that have a proven track record and love working with investors. Other local investors will point you in the right direction.

*Please research HVAC units. We all know the big name brands but do you know those same companies produce less known brands? (think buying generic soda that is really Pepsi but packaged as some local variety for half the cost) You can get phenomenal units for literally thousands less simply because a different nameplate is put on the unit. Finally...BUY AMERICAN!

Roofers - ask around but before you hire anyone ensure the roofers are licensed, bonded, and most importantly PROPERLY insured! Find out what flashing they are using, what shingles they are using, how much they are charging a square, are they removing the old roof for you? If so, how much? Finally, don't use anyone who will roof on a second or third set of shingles on your home. I won't get into a fight on here - bottom line that voids the warranty on your sheeting and shingles. Plus it is improper and puts unnecessary weight on your roof. A good roof should cost you 3 to 5k installed based on the size, pitch, and how much plywood/OSB needs to be replaced.(please don't use OSB)

Foundation Repair - this is hands down the biggest scam trade I have seen. Not all foundation repair people are like this, many are honest. But I can't tell you how many times I have had someone present a quote from a big local company and their cost is 20k or more when in reality the repair cost was $1500 to $2000. (this is not an exaggeration) The best way to avoid getting conned, if you don't know foundation repair, is to call a structural engineer. You will pay about $450 for the engineer to come out and then another $250 to $500 for their report. However, they will have good recommendations of who to use to do the repairs, they have nothing to gain by padding how much work needs to be done, and the best bonus is - the foundation repair company has to follow the scope of work the engineer outlines. (additional bonus - with said engineer report in hand you can legally have a permit pulled for the foundation work) Again, find a good, long-term, probably family owned foundation company and call them. They should be smaller but with a great reputation. Skip the big guys.

Being able to find great, honest subcontractors will both springboard your investing and save you thousands.  Do your research up front, ask other investors who they use, and follow some of these simple tips.  Best of luck to you in your investing. 

Cheers,

Dan