Have you ever found yourself getting frustrated when working with a contractor on a project? One of the most challenging aspects of being a real estate investor is dealing with contractors. Working with a great crew can make a job go smoothly, while working with a sub-par crew can turn into a nightmare.
After working with general contractors for the last 16 years, I’ve learned a few valuable lessons and best practices.
You don’t have to know everything.
Knowing as much as the contractor is not your job; however, it is important to understand at least the basics in order to speak confidently with a general contractor (GC). If you aren’t sure where to begin to learn, start with books and YouTube.
I remember not knowing anything about roofs for a long time. I’m not a roofer and never planned on becoming one, but when I suspected work on a job wasn’t done correctly, I did the research to learn more about it. The GC was surprised when I climbed up on the roof with him and was able to point out corners he had cut on a job, and it never happened again.
Talk with experts and learn from them. Have them explain to you why and how things are done. Often times, just being able to see something and have it explained helps.
Get a second opinion.
If a contractor tells you something and you’re not sure about what they’re saying, seek out another opinion. This applies to the pricing of jobs as well. Don’t ever just settle for the first bid. Contractors can be negotiated with, especially if you know your numbers ahead of time.
Multiple bids on jobs are a must when you are vetting new contractors. When seeking other opinions, some resources include other contractors, family members with construction experience, people at Lowe’s or The Home Depot or online research.
Be confident with your expectations and firm in your agreements.
Be prepared ahead of time with a scope of work, timeframe, draw schedule and material specs. Explain how you use a contract and why. Using a contract puts you in control of the situation. It also gives you something to fall back on if a disagreement arises. By setting the proper expectations from the beginning, you establish a clear direction for the job and the relationship with the GC.
I hear of investors all the time who lose money to contractors by paying them upfront for work or materials, or of contractors who go “dark” before a job is complete. Clearly defining the terms of the job helps to avoid these costly and frustrating situations.
Build and nurture the relationship.
Remember that mutual respect goes a long way. By holding the contractors you work with to the agreements established ahead of time, you build respect in the relationship, so honor your word with them. If they complete something and you promised to pay them, make sure that you do (as long as the work is acceptable and in accordance with what you agreed upon).
Giving them praise when it’s due also goes a long way in establishing goodwill. Often, we are quick to get frustrated and angry with a contractor when they mess up on a job, so take the time to recognize when something is well done. Everyone appreciates the occasional pat on the back. If they do good work, give them more. It’s important to convey that by doing a good job, they’re more likely to have steady work from you.
Mutually beneficial business relationships, such as those with contractors, are critical to the success of your business. By educating yourself, getting additional opinions and bids, being clear with your expectations and taking the time to foster a good relationship with your contractor, your business will benefit in the long run and save you time and frustration.