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Best Practices: An Easy Guide to Subcontractor Management

May 20, 2021

Hiring and managing subcontractors are key parts of any construction project and can also be one of the most costly, if not properly assessed and organised. This best practice guide will show you how to take the stress out of managing subcontractors.

Building relationships with your subcontractors

From day one, it’s crucial to build trust and respect with subcontractors. Make sure you always pay subcontractors in full and on time as agreed to reassure existing subcontractors in your supply chain and keep a track of invoices for clarity on payments.

To follow up payments and ensure invoices are paid in a timely manner, you need a well-organised system. Construction management software that allows you to manage all aspects of a construction project can help with this process by automating and streamlining many processes involved with managing subcontractors, so you can do more – with less time.

Provide accurate information

Without accurate data recording, a huge range of variables can affect a project’s cash flow. Mistakes are common in long, complicated projects, but if a change to an order isn’t recorded, if available cash is overestimated or if the company is simply spending too much without realising it, money quickly disappears.

Quality versus cost

It might be tempting to hire the cheapest subcontractor you can find, but it might not be as cost-efficient as it seems. Poor quality subcontractors result in poor standards of work and safety, which will ultimately cost you more money in the long run.

Keeping a tight hold on your finances is always a good idea, as it lets you know exactly how much leeway you have for sudden, unexpected changes, for example, a rise in material costs. Suitable software helps you improve efficiencies and save money, so you don’t have to slash your budgets and end up with low-quality work.

Monitor, review, comply

At the end of any project you need to look back and review where improvements can be made, assessing everything from deliverables to compliance. Software can help here: in a single click you can check a subcontractor has the correct insurance or verify a potential hire with the HMRC, shortening otherwise lengthy processes. You can then use this analysis to prepare, plan and predict for the next project.

Such in-depth reviewing can be difficult to quantify and monitor over time if proper records are not kept, but the right software allows you to quickly analyse and identify, for example, if a particular subcontractor’s performance has been deteriorating over time and alternatives should be considered for future projects.

Subcontractor management software

Eque2’s Construct for Sage software gives you complete peace of mind around the compliance and quality of the subcontractors you’re employing and lets you control exactly when and how much you pay them.

Construct provides up-to-date Online CIS Verifications, Insurance and CSCS Tracking and Performance Ratings, so you can be confident you’re making the right decision when hiring a subcontractor.

Also, managing subcontractors is easy with our Construct software, thanks to automated, streamlined Subcontract orders and applications, as well as cumulative tracking and Self Billing Payment Certificates.

To find out more about how Construct for Sage can benefit your business, click here. If you’d like to attend one of our free, online webinars, check out our webinar page where we cover a wide variety of topics. 

In a rush? Click here to find a pre-recorded webinar on how Construct for Sage can help you manage your subcontractors. 

Want a demo? Click here to register for a free, 1-to-1 demo for when it’s convenient with you and discover why Construct for Sage is the most popular contract cost management solution for small and medium size contractors in the construction industry.

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