How to Find and Hire a Contractor

The selection of a contractor is the single most important part of your project.  Whether you’re remodeling a kitchen, building an addition to your home, or undertaking a complete gut-to-the-studs remodel, the contractor is the one who is going to fulfill your expectations – or not.

 

The first question to ask yourself is; are you going to be working with an architect?  (More on that here.)  If so, then the selection of a contractor is a joint effort between the two of you and the architect can be your guide.  Just remember that the final decision is up to you.  Even if your architect has a contractor he frequently works with, insist on interviewing and bidding at least two more and doing your due diligence as described below to make sure you’re comfortable with your architect’s choice.  NEVER blindly accept your architect’s contractor.

 

Another option is to work with a design-build firm.  For more on that, read this.

 

If you’re not working with an architect or a design-build firm, then it’s all up to you.  Don’t rush it.  Don’t hire the first person you find.  Expect to take your time and interview as many contractors as possible until you feel like an expert in your own right.  You need to be completely comfortable and confident with your final choice.  The worst thing you can do is put yourself in a position where you’re going to have to hire a second contractor to finish the job – or fix the first one’s mistakes.

 

I think of the process in three phases – 1) initial screening, 2) due-diligence, and 3) final negotiations.  Here’s how to proceed:

 

Phase 1 – Screening

1.  Collect referrals.  Cast a wide net.  Talk to as many friends and relatives in your area that you can find and ask them who they know.  Better yet, canvass your neighborhood.  If anyone has had work done that you like, find out who did it.  It’s an added plus to have a contractor who commonly works in your neighborhood and knows the particular quirks of the area.  Try to get at least five or six candidates – I started with as many as ten for my first project.  Do not waste your time looking in the phone book or responding to flyers tucked in your mailbox. 

 

2.  Meet face-to-face.  Your contractor is going to be your partner – a member of your family for many months.  It’s important to work with someone you like and can communicate with.  Do they respond to an invitation to meet?  You’d be surprised how many contractors don’t even return a phone call.  How promptly do they respond?  It’s important that they be readily available and responsive when you need them.  Do they come prepared for the meeting?  Don’t tell them what to bring – see if they adequately prepare on their own.  A good, professional, business-like contractor will bring photos of other jobs they’ve done, sample contracts and invoices, and a list of references.  I’ve had some even give a Powerpoint presentation.

 

3.  Let him/her talk first.  In your first meeting, resist the urge to do all the talking or to show off your home.  Let the contractor start the meeting.  You’ll learn more by seeing how he/she fills the awkward silence.  Save your questions till the end after you see what information they volunteer.

 

4.  Be prepared with your list of questions.  And take lots of notes.  Go into the meeting knowing exactly what you want to know before the meeting ends.  Make yourself a checklist and use it for every interview so you can compare apples-to-apples when you’re making your final selection.  Then, whatever they don’t answer on their own, you can start asking the right questions.  These should include:

• Are they licensed and bonded? 
• How long have they been in business?
• How many employees do they have?  Some contractors may work alone, some might head a big company.  One’s not necessarily better than another but be aware that if you work with a one-man-band, what happens if he gets sick or has an emergency?
• What’s the biggest job they’ve ever done?  What’s the smallest?  What kind of projects do they do most often?  See where your project falls in their field of experience.
• Who are their subcontractors?  Even the largest contractors sub-contract specialty work like plumbing, electrical, concrete, etc. and a contractor is only as good as his subs.  How long have they worked with each of them and how deep is the relationship?  How much control will you have over their subs (if you want any).  What is their bidding process when working with subs.  Will you be able to bring in your own subs (if you know any). 
• How many jobs do they typically carry at the same time?  How many other jobs will they have while they work on your project?  Will you be their only job or will you be competing for their attention with other projects?  A large contractor with other jobs will be more likely to be financially stable than a lone operator who’s always cash-strapped – just be sure they have a team dedicated to your project so you will feel like their only – or most important – client. 
• Ask them to describe their best and worst experiences.  What has made particular projects more successful than others?  How have they resolved differences with difficult clients?
• How long do they estimate your project will take?  How do they stick to a schedule?  What’s their track record of finishing on time or finishing late?  What issues might they encounter on your project that could cause delays?
• What does their typical contract look like?  Do they prefer to work on a fixed-price or cost-plus basis?  How flexible are they if you want to buy some materials like appliances and fixtures directly to save money?  (More on that here.)
• How do they bill?  What does their typical invoice look like?  How much detail and back-up do they provide?  How quickly do they expect you to turn around payment?

5.  Set your own rules.  Regardless of their preferences, they need to accommodate how you want to work.  What kind of contract do you want – fixed price or cost-plus?  How do you want to be billed and how often?  How long do you need to turn around payment?  What kind of back-up and detail do you want to see on your invoices?  The right contractor for your job will be flexible enough to meet your needs – or provide a convincing explanation for why they prefer to work their way.

 

6.  Now discuss your specific job.  After you’ve learned everything about the candidate, then show them your house and discuss what you want done.  Be general – leave details open-ended – see what information they ask for or what suggestions they have.  A good contractor won’t be afraid to suggest alternatives you might not have thought about, or point out problems or issues such as supporting walls, space utilization or potential permit issues.

 

7.  Get references.  References are paramount and any decent contractor should come prepared with names and phone numbers – or promise to get back to you quickly with them.  Get at least three client references – but also ask to talk to two or three sub-contractors or suppliers in addition to clients.

 

8.  End the meeting.  Thank them and send them on their way.  See what kind of follow-up they do.  See if they call to thank you for the meeting and propose next steps.  See how quickly they get back to you with promised follow-up information like references or a sample contract.  See how eager they are to earn your work.

 

Phase 2 – Due Diligence

1.  Call their references.  They should have prepped their clients to expect your call so don’t be shy.  Ask them how satisfied they are and if they would work with the same contractor again.  Ask them if the contractor met their expectations.  Most importantly, ask them to describe a conflict or disagreement and how they worked through it.  Nobody is perfect and your job is going to be stressful.  Working through your differences will strengthen your relationship.

 

2.  Arrange to meet again – but at their office this time.  See how established they are.  See how they run their business.  See how busy they are.  Meet their team.  Talk about the results of your reference calls and any new questions that have arisen.

 

3.  Ask for site inspections.  Ask each candidate to take you to at least two, if not three client’s homes and show you their work first-hand.  They should have a good enough relationship with past clients to be able to set this up.  If not – that’s a huge red-flag and stop right there.  A satisfied client should be more than happy and proud to show off their home.  My contractor is always parading prospective new clients through my projects and I’m more than happy to oblige.

 

Phase 3 – Contract Negotiation

By now you should have narrowed it down to two or three finalists.  Don’t dismiss anyone until you’ve signed contracts with your first choice – you never know for sure till the ink is dry and going to your back-up after you’ve dismissed him puts him in a stronger negotiating position. 

 

There’s so much involved in negotiating a contract that I’ve saved it for a separate posting.  Look for it here.  But in summary:

• Decide how you want to work and be firm.  With everything you’ve learned up to now, you’ll know if you want a fixed-price or cost-plus contract.  (More on that here.) 
• How do you want to be billed?  How much back-up do you want to see?
• How amenable is he/she to letting you save money by buying appliances and materials yourself?  Or subbing parts of the job yourself?  This gets complicated so I’ll address it in a separate posting.
• What kind of assurances can you build-in to the contract for them to stay on schedule?  Again, more on this later.

This is a lot of information but there’s a lot involved in hiring a contractor.  Stay tuned for a separate posting about negotiating your contract and feel free to contact me through this blog with any questions.  I’m here to help.

  

 

Posted by jetsetrnv8r on October 3, 2008

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