To Sub or Not to Sub? A Solo Builder’s Guide to Hiring Help

You can do it all, but should you? Knowing when to hire a pro is the difference between a profit and a hospital visit.

If you are trying to pull off a project on your own, you already know that money is tight and time is even tighter. Figuring out what work you should do yourself and what you should hire out is a massive deal. The actual process of securing subcontractors and issuing purchase orders for your materials is referred to in the industry as buying out a job, or procurement.

Before we jump into specific project types, let’s break down the core concepts you need to understand before you hire anyone to step foot on your site.

The Core Concepts of Hiring Help

• You Make the Rules: General contractors have the responsibility and the right to determine how a job gets completed and which parts of the work will be subcontracted to others.
• Defining the Scope: The exact work that a subcontractor is hired to do is known as their scope of work.
• Building Bid Packages: To keep things organized, contractors develop separate bid packages to identify the individual scopes of work they want to hire out.
• Don’t Forget the Details: You have to make sure nothing is omitted from these packages, because if a task isn’t included in a subcontractor’s scope of work, it will be expensive for the general contractor who has to get the work done somehow.
• Bid Shopping is Bad News: There is an unethical practice called bid shopping, which involves a contractor sharing one subcontractor’s bid with other subcontractors to try and get lower prices. Doing this can give you a bad reputation, making it hard to get solid bids on future jobs.
• The Three Selection Criteria: When you review bids, you shouldn’t just look at the bottom line; you should evaluate subcontractors based on three broad criteria: business competency, trade competency, and price.
• Business Competency: This looks at their business and financial background. You want to know how long they have been in business and if they have sufficient cash reserves.
• Trade Competency: This focuses on their ability to produce quality work within the project schedule. You want to make sure they can supply the job with appropriate labor to get it completed efficiently.
• The Low-Price Trap: The contractor who submits the lowest bid isn’t always the best one. If a bid comes in way too low, it usually means the subcontractor missed something, which will result in expensive change orders or poor quality work.
• Shifting the Risk: A huge advantage of hiring subcontractors is that it shifts some of the financial risks of the project off the general contractor and onto the subcontractor. The specialty contractor assumes the risk of properly pricing out the labor and materials for their part of the job.
• Better Quality and Speed: Specialty contractors are experts who perform the same tasks over and over, so they are generally more productive and produce higher quality work than a general contractor could on their own.
• Management Headaches: It isn’t all positive, though; having subcontractors on a project adds administrative and oversight complications. Every subcontractor represents a separate business with their own employees and differing goals.
• Financial Stress: Hiring subcontractors can cause financial problems because even if the owner delays paying the general contractor, the general contractor is still obligated to pay the subcontractors on time.

🏗️ 1-Man Tiny Home

Concept: Risk Transfer

Building a tiny home is a dream for a lot of DIYers. Because the space is so small, it feels like you should just do every single piece of the build yourself to save cash. But here is a major tip for solo operators: subcontract the dangerous stuff!

Things like running gas lines or doing complex electrical hookups are high stakes. Hiring a specialty firm has the advantage of shifting financial risks away from you. When you hire a licensed plumber to run the gas, they take on the risk of correctly pricing the labor and materials.

Even better, the subcontractor carries the responsibility for the warranty on their portion of the job. This reduces your liability. Basically, if the gas line leaks and the trailer blows up, it’s going to be on their insurance policy, not yours. That peace of mind is totally worth the cost of bringing in a pro.

🏚️ Single-Family Fixer

Concept: Scope Gaps

Flipping a single-family home means coordinating a bunch of different trades at once. You might have someone doing floors, someone doing paint, and someone else hanging drywall.

The biggest trap here is the “Scope Gap.” When you receive bids, you have to analyze them by comparing different scopes of work to ensure no details have fallen through the cracks. For example, when hiring a drywall sub, look at their bid closely. Are clean-up responsibilities clearly included in the negotiations?.

If clean-up isn’t explicitly included in their scope, you are now the designated trash collector hauling heavy drywall scrap to the dumpster. Additions that aren’t included in a subcontractor’s scope of work are expensive because you have to get the work done somehow. The exact same thing goes for overlaps; if two trades overlap in their work, it causes delays and unnecessary costs. Make sure every single task is covered by somebody.

🏠 House Hack Fixer

Concept: Long-Lead Items

A house hack is when you buy a place, live in one part, and rent out the other unit to cover your mortgage. In this scenario, time is literally money. Every day the unit sits empty, you are losing out on rent.

This brings us to the concept of procurement and “long-lead” items. General contractors sometimes have to buy materials that have special manufacturing or delivery requirements, which are called long-lead items. You have to order these materials early so they are delivered close to the time they are needed.

Examples of these materials include specially designed windows or exotic granite countertops. You should be ordering these before you even close on the property! Sometimes contractors order these materials early just to lock in the pricing, too. Delays on these items will completely stall your site, because the work of most subcontractors is linked to another contractor, meaning a slowdown with one impacts everyone else down the line.

Conclusion

Being a solo builder doesn’t mean you have to literally build it all solo. Taking the time to properly define scopes of work, avoiding shady practices like bid shopping, and picking subs based on their actual competency rather than just a cheap price will save you massive headaches. Remember to transfer your risk on the dangerous stuff, watch out for scope gaps so you aren’t doing free manual labor, and order your long-lead items yesterday!

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