General Contractor vs. Subcontractor: What's The Difference?
Construction projects require the work and dedication of many key players, whether they involve building a school, a commercial business, or an entirely new residential neighborhood.
General contractors and subcontractors are two of the primary parties typically involved in construction projects. But what is a general contractor? What is a subcontractor? And what’s the difference between the two?
Here, the My Site Plan team explains the key distinctions. So, when it comes to general contractor vs. subcontractor, you’ll know which professional is best for your next construction project.
Table of content
What is a general contractor?
A general contractor (often referred to as simply a contractor) is the person or company that takes responsibility for your construction project.
A general contractor does it all, from the initial development of project plans to managing the project’s labor forces. They take complete control of the project, liaising with clients, managing budgets, and ensuring that everything goes to plan.
General contractors are typically hired to run commercial or residential construction projects. They are almost always licensed by their state to help ensure that their work meets a specific set of code requirements.
Thinking of being your own contractor? Take a look at this post: Read this before you become your own contractor.
What do general contractors do?
Some primary examples of the work that general contractors do include:
Maintaining records of project details
Monitoring administrative details, like scheduling, payments, and cash flow
Overseeing the timeline of work
Ensuring worker safety and compliance with protocols
Ensuring work quality
Supplying all materials and labor needed for the project
Supplying the vehicles, tools, and other equipment needed for the project
Working directly with clients to negotiate deals
Hiring subcontractors (more on this below)
What are subcontractors?
Now we know about general contractors, let’s find out: what does a subcontractor do?
A subcontractor is a specialist hired on a contractual basis by a general contractor. As part of the contract, a subcontractor will work in a specific niche of a construction project.
Subcontractors can be individuals or companies. However, their fundamental purpose is to complete smaller, more specialized tasks within a larger construction project.
There are several different types of subcontractors, each specializing in a different area of construction.
What does a subcontractor do?
Some primary examples of the specialized work that subcontractors do include:
A consideration when working with subcontractors
Subcontractors are skilled in a particular construction niche. But they can be incredibly expensive to hire.
Their hourly rates tend to be high, and they usually work as independent professionals. This means they don’t report to supervisors within a specific construction company.
These elements can make it more expensive to work exclusively with subcontractors, making it a good idea to have a general contractor to organize your construction project and personnel.
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General contractor vs. sub contractor: What’s the difference?
Now that we’ve defined contractor vs subcontractor, let’s take a moment to simplify things even further. Here’s a summary of the key differences between these two types of contractors:
General contractors work directly with clients and oversee the entire construction project, from hiring laborers to acquiring materials and more. They can do anything from construction and renovation to repairs and are essentially in charge of everything, including hiring subcontractors.
Subcontractors are hired by and follow the instructions of the general contractor as contracted employees. They are hired to perform specialized tasks as part of a larger construction project. They typically work in one specific construction area, such as painting, plumbing, carpentry, or appliance installation. Subcontractors generally don’t have to work directly with clients or customers on a construction project unless the client is acting as their own general contractor.
Not every general contractor will choose to hire a subcontractor to assist with every construction job. Depending on the skills of a general contractor and their regular laborers, they may not require the services of subcontractors at all.
Other types of contractors
Here are a few other types of contractors you might hear about while researching your construction project.
Prime contractor
A prime contractor is a contractor who works on government and large-scale construction projects.
Like a general contractor, a prime contractor oversees the whole construction project. However, unlike a general contractor, a prime contractor acts as the primary point of contact for a client or government agency.
Independent contractor
An independent contractor is a self-employed individual who chooses the projects they want to work on. They are responsible for managing their own business, managing their finances, and finding clients.
These contractors tend to offer a broad range of services, ranging from construction to remodeling to consulting to project management.
Specialty contractor
A specialty contractor is another name for a subcontractor. These contractors specialize in a particular area of building work.
Final factors to consider going forward
Understanding the key differences between general contractors and subcontractors is essential, especially if you plan to carry out any intensive construction projects soon.
The key distinction is that general contractors are in charge of almost everything, including hiring and managing subcontractors. Meanwhile, subcontractors usually specialize in a single area of construction.
If you’d like to learn more essential information about construction, demolition, or remodeling, you can read more on our blog. And, if you’d like help creating a site plan for your project, get in touch with the My Site Plan team today.
FAQs
How much do general contractors cost?
According to the latest data, general contractors cost between $300 and $500 per day. They will charge between $150 and $250 for every helper or laborer.
However, most general contractors give you a price for the whole project, taking into account the cost of materials, the scope of the project, and any subcontractors they need to hire.
When to hire a general contractor?
You might like to hire a general contractor in any of the following scenarios:
When you don’t have time to manage a construction project yourself
When you don’t already know which specialty contractors you want to hire
When you want to work with someone who’s licensed and insured
When you want a project done professionally
When you hire a general contractor, you can count on their construction expertise, industry connections, and project management skills. They help projects run smoothly and can save you both time and money in the long run.
How to hire a general contractor
To find a general contractor, you can check local directories, search the internet, and ask family and friends for recommendations.
Once you’ve created a shortlist, you need to talk to contractors about:
Their licenses and insurance
Their previous work (they should be able to show you pictures and provide the names of previous clients)
The scope of the project and their estimate
Everything that the estimate includes
Payment options
Try to meet with at least three general contractors before making your decision. You can also take a look at some of our other posts for more great advice:
Can a general contractor handle tasks typically assigned to subcontractors?
Yes, if a general contractor has the necessary skills and resources, they can perform tasks typically assigned to subcontractors. However, they often hire subcontractors to manage specialized work more efficiently.
When is it necessary to hire a subcontractor?
Hiring a subcontractor is necessary when you need specialized skills that the general contractor can’t provide. This could include things like electrical work, plumbing, or specialized carpentry.
How can I ensure a subcontractor's work aligns with my project needs?
Before hiring a subcontractor, you should:
Check they have specialized expertise in the task required
Verify their professional license(s) and insurance
Discuss their previous work to gauge their skills and if they’re a good fit for your specific project.
What are the common challenges of managing subcontractors?
Common challenges of managing subcontractors include controlling costs due to their independent pricing, ensuring the quality of work meets project standards, and coordinating their schedules with the overall project timeline.
When do you pay a contractor?
When you pay a contractor depends upon the contractor and the project scope.
For smaller projects, contractors may ask for a deposit and then a final sum upon completion.
For larger projects, contractors usually break project costs down so clients don’t pay for construction work in one lump sum. Instead, they create a schedule where clients pay in installments.
Read more: Contractor payment schedules: what's the best for my project?
This post was originally published on 2022-04-14 by Ryan Crownholm. It was updated on 2024-05-08 to reflect the most recent data.
- Ryan Crownholm
