Building a house is a
complicated process that involves knowledge of architectural design, building
codes, zoning regulations and basic construction elements. A residential
building contractor oversees the construction of individual houses and
multi-unit housing projects. A commercial building contractor oversees the
construction and remodeling of stores, malls, hotels and other commercial
projects. Most building contractors own their own companies and many of them
worked in the construction industry before becoming contractors.
Contracting
A
building contractor finds, solicits bids from and schedules all of the
subcontractors that are necessary to complete the project. The new homeowner or
business owner contracts with the building contractor, and the building
contractor contracts with the subcontractors and suppliers. Contractors
typically charge from 10 percent to 15 percent of the total project cost for
this service. For example, if the contractor oversees a $1 million project, his
fee for doing so might be in the neighborhood of $100,000 to $150,000.
Client
Interaction
A
potential new homeowner or business owner usually consults with two or three
contractors and requests bids from each. A large contractor might have a
bidding department that analyzes projects and submits bids. Small contractors
figure their own bids. If chosen, the building contractor handles everything
from obtaining permits, meeting with Home Owners Associations, or HOAs,
ordering materials, scheduling code inspections and overseeing the
construction.
The Contracting Business
A
contracting company can be a single, self-employed individual or a large
corporation with a board of directors, supervisors, site and project managers
and office staff. The size and scope of a contractor’s business often
correlates with the need for housing or business development where the
contractor lives. In small, rural areas, a contractor might employ a handful of
framing carpenters and subcontract with specialty contractors who provide other
construction services, such as excavating, roofing, electrical and flooring.
There is no set organizational standard for contracting companies.
Testing, Licensing and Experience
Most
building contractors know something about construction before starting their
own contracting companies. Typically, this involves working for a general
building contractor for a number of years. In some communities, prior
experience is a requirement. States can set licensing standards, but individual
counties or municipalities often have stricter standards, which can include
testing, providing proof of commercial liability insurance, obtaining surety
bonds for specific projects and limits on the financial scope of a project a
contractor is allowed to bid. A degree in construction management is beneficial
for students who would like to become contractors, but hands-on training is
still desirable.
