Some useful tips to select an authentic subcontractor in your construction project

In a construction project there are specific areas where a contractor requires the assistance of an expert subcontractor. The objective of a general contractor is to handle the entire activities and performance among subcontractors.

A subcontractor can be shortlisted and selected on the basis of various points like past performances, financials and other important factors.

Given below, some valuable points based on which a perfect subcontractor can be selected for any construction project.

Before going to hire a subcontractor, it is necessary to assess the scope and project requirements perfectly. The service of a subcontractor is essential if the work remains beyond your expertise area or your resources are already settled to a diverse project for which it becomes difficult to accomplish the work with internal resources.

Prior to initiate the aptitude method, the general contractor should have to establish the size of the scope that is subcontracted out as well as the resources required to execute this work. It is vital to have clear idea on this part before implementation so as to get the proper bonding and insurance coverage for you and your subcontractor.

For lengthy subcontractor scope, it is required to undertake the steps like segregating the project into smaller parts or evaluating if it is the perfect project for your organization.

As soon as it is settled that it is appropriate for your organization, let's then proceed on to shortlist and choose the proper subcontractor.

Now if it is obligatory to hire a subcontractor with the purpose of supplementing your workforce, the general contractor should have to analyze the following areas:

• Safety
• Financials
• Staffing/Organigram
• Equipment
• Project Plan and Schedule
• Past Performances
• Comparable Projects
• Letter of Recommendation or References
• Project Cost and Payment Terms

A subcontractor should be capable of supplying this information as an answer to your RFP or throughout an RFQ process.

Safety performance is considered as one of the most crucial factors for a subcontractor at the time of qualifying. Ensure to evaluate the EMR rates, OSHA recordable, time loss owing to accidents/incidents. From a contractor point of view, you should assess who is their primary safety officer, its background, and credentials. As a contractor enquire of their safety plan and program and ensure to review it in order that it goes along with your safety expectations. Safety can also comprise of environmental response and methods upon emergencies and spills.

To gather more information on other crucial points, go through the following article thebalance.co

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Published By
Rajib Dey
www.constructioncost.co
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Some useful tips to determine the monthly rental value of your structure

From this construction video tutorial, we can gather knowledge on how to make the valuation of monthly rent concerning a building that has been developed on a land.

There are two types of rents like net rent and gross rent. Net rent does not include taxes associated with land or construction. Gross rent normally includes these types of taxes.

As for example, here, the value of plot is taken as 4,00,000 rupees (inclusive of all taxes).
The value of structure is taken as 4,70,000
As per government law, 5% of land value and 6% of construction value can be taken as return in one year.
Based on the above figure, the monthly rent of the building should be determined.

Therefore, the annual rent should be as follow :-
4,00,000 x 5% = 20,000/Rupees

Annual rent of structure = 4,70,000 x 6% = 28,200/Rupees
So, total annual rent will be = 28,200 + 20,000 = 48,200/Rupees
Therefore, monthly annual rent will be = 48,200/12 = 4017/Rupees

Now, if you want to find out the time period when total investment for land and structure will be recovered, apply the following formula :-
4,00,000 + 4,70,000 = 8,70,000/4017 = 216.58 months

To covert the value to year
216.58/12 = 18 years.

To get more information, watch the following video.

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Published By
Rajib Dey
www.constructioncost.co
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