With all the disruption to the construction industry this past year, labor availability is having a significant impact on the subcontractor market. As such, many contractors are using this opportunity to ramp up their self-performing construction teams.
What does self-perform mean in construction?
Contractors that do self-perform work have the ability, and flexibility, to handle some (or all) of the specific trade work without the need for third-party subcontractors. They use their own teams for construction activities like carpentry, concrete work, masonry, steel framing, or other specialty trades.
Why does a general contractor self-perform?
There are a number of reasons that a general contractor would choose to self-perform a portion of the construction on any given project. Contractors will choose to self-perform during the construction process for a number of reasons:
- They want to ensure the high quality of the work being done
- They have a more aggressive timetable than a subcontractor can keep up with
- They have a more experienced, skilled labor force and subcontractors can provide
- Subcontractors are spread thin due to labor shortage and less willing to provide estimates for work still in the early design stages
There are different variables that come into play when choosing to bid self-perform contracts. A contractor needs to consider insurance, labor availability, resource management, and increased risk to name a few.
Though there are more hurdles when choosing to self-perform, there is also an opportunity for contractors to have more control over estimates and pricing, both of which will appeal to project owners that are taking bids. As a lack of input from subcontractors creates a gap in the progress of a project, owners are looking to the general contractor to offer solutions.
If you’re a contractor that doesn’t have self-perform capabilities, there’s a strong chance that you’ve been removed from the pool of candidates so project owners can focus on the general contractors that are able to fill gaps with their self-performing tradespeople.
3 Resource planning tips for self performing contractors
MAKE PROPER USE OF SPECIALIZED SOFTWARE
In most cases, general contractors will use the same tools to manage their project management and field teams. This typically consists of a few spreadsheets, a whiteboard, some paper notes, or a combination of all three. There are many benefits to shifting to a specialized software to manage your different project and self-perform teams, some key benefits include:
Less manual, more organized – Managing multiple resources across multiple projects using a series of spreadsheets is a manual data-entry nightmare. By using specialized resource management software, like Bridgit Bench, you can consolidate your project and field teams into one single tool.
This helps provide a single source of truth for your entire labor strategy and is updated in real time. It also helps to cut down on the hours of endless copy/pasting that comes with constantly updating a static, manual spreadsheet.
You also have the added benefit of being able to sort and filter your self-performing teams. You can filter for specific skill sets, availability, and location to ensure you’re assigning the best person for the given task.
Streamlined labor requests – Managing labor requests on a daily basis is a headache at best when the process isn’t standardized. Field labor management personnel will often need to deal with phone calls, text messages, and emails requesting labor for projects across their pipeline. Keeping this information organized and assigning the right people can result in hours each day being spent on a process that could be much easier.
Resource management tools like Bridgit Bench help to standardize this process. Superintendents can make labor requests directly from their mobile device, and the field management team can quickly address any labor requests and automatically notify all stakeholders of the project assignment once a request is filled. Saving time and money, all from within the same tool.
SET UP YOUR PLAN EARLY
There are benefits for both the contractor and the project owner when the scope of self-perform work is manageable by the contractor. Don’t wait to suggest handling specific processes when communicating with the project owner. If you’re waiting until they are shopping bids, you may already be too late. If you’re open and transparent in your communication with the owner early on, it’s more likely you’ll be able to find a solution for specialty work before any contracts are signed with subcontractors.
HELP PROJECT OWNERS REALIZE VALUE
There are benefits for both the owner and the self-performing contractor. It’s likely that your self-perform teams are highly qualified to lend their expertise during the design phase. Having your team involved in all aspects of planning shows added value to the project owner before they start to shop potential bids for trades work. In the case of a less educated owner, it also means they’re relying more on your expertise throughout the design and planning process.
There’s also compounding profit when paying for a construction project. Since every step in the supply chain is needing to make a profit, it can often be an eye-opening realization when it comes time to pay invoices. Make sure to communicate transparently about your estimates and let the project owners see how competitive you can be with project costs when using your own team.