You may have a garage full of tools, a truck with empty Mt. Dew bottles in the bed, and your Saturday afternoon free for This Old House, but, a General Contractor, these do not make.
Everybody says that you can save money by being your own General Contractor, but what no one says is how much time it will take out of your normal daily life and the value of that time. Yes, you may save money, but like any complicated process, it may not be worth it.
You may want to consider the following items before embarking on this new adventure:
1. YOUR KNOWLEDGE OF CONSTRUCTION MANAGEMENT.
Construction Management is a term that is used to define the duties of a professional that is often hired by the Owner to manage the entire scope of a project from beginning to end. A Construction Manager will refine the scope of a project, prepare a preliminary budget, and design a realistic schedule that can be achieved. Acting as your own General Contractor, these duties fall to you. You may choose to hire a Construction Manager, but remember, you are trying to save money. If you do decide to act as your own General Contractor, hiring a Construction Manager may be the only way to ensure your project is a success. In your role as a Construction Manager you should be able to review a set of plans and determine a range for the project budget, find errors or omissions in the plans, prepare sub-contractor schedules, and determine the scope of these sub-contractors.
2. YOUR KNOWLEDGE OF LOCAL CODES.
Just because you have a set of plans does not mean that they meet your local codes. Planning a remodel or renovation?…when you uncover something you did not expect, you may have to bring it up to current codes before proceeding. Do you know the individual inspectors in your area? Many General Contractors have built relationships with the individuals that will inspect their projects. A certain level of trust has been established with these individuals, and many times an inspector who has experience with General Contractors they know will actively work with these Contractors to solve problems in a very cost-effective way. Acting as your own Contractor on a single project, you may not have the opportunity to establish this type of relationship with your local inspectors. In order in keep the project moving, you have to make sure that the required inspections are scheduled and performed in a timely manner. An experienced Contractor will know what can be “covered-up” and what must be left “open” in order to complete the work properly.
3. YOUR EXPERIENCE IN CONTRACT NEGOTIATION.
Depending on the size of the project, you may receive a lump sum price for a certain scope of work on your project, but other work may be a time and material type of contract. If you do not fully understand these terms, you will need to educate yourself on what they mean and what items may be open for negotiation. Contracts are not only about money; they include schedules, retainage, insurance requirements, and substantial completion requirements. There’s a saying, “Everything is negotiable”…but it may not serve your project to ‘beat down’ your sub-contractor to save a few dollars. You should have the knowledge to determine what is a good price, a fair price, and a ridiculously great price. Here’s a hint…do not go with the ridiculously good price. There’s another saying, “You get what you pay for.”
4. YOUR NETWORK OF SUBCONTRACTORS AND TRADE PROFESSIONALS.
How are you going to choose your sub-contractors…yellow pages, trade magazines, word of mouth, or hours of research and interviewing potential sub-contractors? Good General Contractors have, among other things, a vast network of design and trade professionals that they can call with little notice and have them perform certain tasks in a very timely manner. The Owner acting as their own General Contractor, usually lacks this network of professionals. The Owner acting as the General Contractor can build this type of network, but for a single project this may take more time than the project allows. And you have to realize that a General Contractor has built this relationship over a long time and several projects. These relationships are what you are paying for when you hire a General Contractor. No matter how much knowledge you may have in the areas of the items above, you only create these types of relationship over time… a lot of time. You have to know what sub-contractors to hire, when to schedule them, and what preparations have to be completed prior to them showing up on the job site for them to work efficiently.
5. YOUR RELATIONSHIP WITH MATERIAL SUPPLIERS.
Getting the sub-contractors to show up at the right time is one thing, but getting the materials on the site is another. Your Big Box home improvement stores have just about everything you need for your project, but material suppliers have better prices and they perform delivery much more often than the Big Boxes. These material suppliers usually require in-house accounts, which you can set-up, but again, this takes time and planning. And the question to ask yourself, “Can I get a the same deal on 100 sheets of drywall as the General Contractor that orders thousands of sheets from the same supplier?”
6. YOUR ABILITY TO MANAGE MULTIPLE TRADES AND TASKS.
General Contracting is an art of multi-tasking. On any given day at your project site, you have to able to direct one sub-contractor’s work, meet with another sub-contractor to get a quote for his work, solve the unforeseen problem that arose that morning, contact the sub-contractor that was supposed to be on-site two hours ago, choose your finish materials, and pay material suppliers and sub-contractors. And finally you must inspect the work put to make sure it was installed properly.
7. YOUR KNOWLEDGE OF CONSTRUCTION TECHNIQUES.
You have to know the techniques used to install materials and how changes to the work may affect the work by other trades. A simple and inexpensive fix during the rough-in phase may prove to be costly during finishing. Although most quality sub-contractors perform very well, mistakes are made. Your ability to recognize these mistakes and have them corrected will determine the efficiency of your project. In construction most things can be fixed, but a General Contractor’s ability to avoid these mistakes is why you pay them. When you are your own Contractor, this duty falls to you, and the General Contractor should pay for mistake made under his contract. You’re the General Contractor…you’re the one paying for the mistake.
8. YOUR AVAILABILITY TO MAKE CHANGES AND ANSWER QUESTIONS ON THE SPOT.
Acting as your own contractor is exactly that. Acting. You have to be able to answer questions during the time in which the work is being performed. Some questions can be answered over the phone, but like most things in construction, you have to see the situation in order to provide the best solution. If you are spending a majority of your time performing your profession, then you will not be able to make the critical decisions for your project in a timely manner. Changes are part of every project. What if you change your mind about the design? What if a situation arises that is not shown on the plans? Do you have the ability to address these items in a way that minimizes costs and schedule impacts? The General Contractor will be represented on the site enough during the project to clearly define and solve any problems that arise. If you are not able to perform this duty, you should reconsider your decision to be your own contractor. This will save you time, money, and headaches.
9. YOUR KNOWLEDGE OF CONSTRUCTION SCHEDULING.
Simply put…you have to know when, where, and how long each task will take and how to schedule these tasks so that your sub-contractors will be working efficiently. Who works in that area first….the plumbers, the electricians, or maybe the framers need to install the blocking? The plumbing may be rough-in, but who installs the vents through the roof, the plumber or the roofer? The rough-in is complete, but will the drywall sub-contractor add the dead wood at the perimeter of the ceiling to attach the board to? Does the electrician have the specs on the heating unit so they know the power requirements and has the HVAC contractor routed the drain lines so that they do not interfere with the plumber? And who works in that area first? Coordination and communication is the key to a successful project, and your understanding of Construction Scheduling is vital in this process. Often a quality General Contractor will have a Program established to deal with the scheduling and coordination of sub-contractors’ work. This Program takes most of the guess-work out of the equation. You probably do not have a Program designed.
10. YOUR ABILITY TO TRACK AND CONTROL THE COSTS OF YOUR PROJECT.
You should know what something costs before you buy it. But a construction project is always changing. How do you control the cost? EXPERIENCE! Knowing the difference between what has to be done and what can be worked around will save you money in the end. For the person acting as their own Contractor, hopefully, this will be kept to a minimum, but it’s rare. On any given project you should be able to know what is being spent on a daily or weekly basis and how you manage and track those costs will determine the amount of money saved. You have to know whether it is less expensive to perform some work yourself or pay a professional. What you save by doing the framing yourself may easily cost you more in the end if items are missing, incorrect, or if things change.
CONSIDER THIS:
The money you save on your project by acting as the General Contractor will not be from a deal on materials, efficient work from the sub-contractors, or from the quality of work. You will save money on your project by not charging for your time. Tom Silva from This Old House says it best:
I suppose you can save some money — if you don”t charge for your time, if nothing goes wrong, and if all the work is up to par — but there’s no guarantee. Part of my job is to get the best prices from the subs that work for me, and they’re willing to offer those prices because they know the job will be organized and I’ll tell them exactly what I expect them to do, which saves them time. And they know that if they do a great job, I’ll have other work for them in the future. A one-time GC doesn’t have that kind of leverage.
The point of this article is not to discourage you from acting as your own General Contractor, but to educate you on the things to consider before you take that step. Managing a construction project is a detailed and complicated process, and the first step is to prepare.
If you found this article helpful please let us know at rcsinfo@redbudcs.com, or if you have any questions regarding your construction project, please contact REDBUD Construction Services.
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