When it comes to home improvement projects, hiring the right professionals can make all the difference. Whether you’re upgrading your electrical system, remodeling a bathroom, or adding a new deck, working with contractors requires careful consideration. Some homeowners choose to work directly with subcontractors, while others hire a general contractor (GC) to oversee the entire project. Each approach has its pros and cons, but knowing what to expect can help you avoid costly mistakes and frustrating situations.
Understanding the Role of a General Contractor vs. a Subcontractor
A general contractor (GC) is responsible for managing an entire project, coordinating with multiple subcontractors, handling permits, and ensuring the work is completed on schedule and within budget. Some GCs actively participate in the work, wearing tool belts and contributing labor, while others act as project managers, carrying clipboards and overseeing progress without getting their hands dirty.
A subcontractor is a specialized tradesperson—such as an electrician, plumber, or HVAC—hired to complete specific tasks within a project. If you hire a GC, you will likely never deal directly with the subcontractors working on your home, as they report to the GC, not to you. However, if you hire subcontractors directly, you have full control over who does the work and how it's completed.
The Importance of Knowing Who’s Working on Your Home
Hiring a GC can simplify the process since they manage the project and handle subcontractor scheduling. However, this convenience comes at a price—usually at least 30% more than hiring individual subcontractors yourself. If you do go with a GC, be sure to keep track of which subcontractors are working on your home. Otherwise, you could find yourself in a difficult situation if issues arise later on.
Real-Life Examples of Why This Matters
- Deck Installation Gone Wrong: A homeowner loved a newly remodeled deck but later discovered that the new boards were higher than the existing ones. When she needed adjustments, she had no idea who installed them because she had hired a GC. She eventually had to track down the subcontractor through the GC, who was no longer working with them. When the deck specialist returned, he mentioned that he would have advised a different approach had he been hired directly as the GC had other ideas.
- Painting Mishap: Another homeowner hired a company to paint her house, but a separate business handled the pressure washing beforehand. After the job was complete, she realized her windows were filthy from the washing process. Because these were two separate companies, she now had to pay extra to have the windows cleaned, an issue that could have been avoided with better coordination.
- Lost Contact with Subcontractors: A family had their bathroom remodeled by a GC who later retired and moved to a different city. Because they never knew which subcontractors were involved, they had no way of contacting the plumber or tile installer for follow-up questions or potential repairs.
How to Protect Yourself When Hiring a GC
If you prefer not to deal with the hassle of coordinating subcontractors yourself, hiring a GC can be the right choice. However, you must take precautions to ensure you’re not left in the dark later on. Here are some tips:
- Request a list of all subcontractors working on your home, including their contact information. This way, if issues arise, you can reach out directly instead of relying on the GC.
- Clarify expectations upfront. Ask your GC how they handle problems that come up after the job is complete and if they will assist with follow-up work if needed.
- Understand the pricing structure. A GC will mark up subcontractor work, so be prepared to pay more for project management. A job that costs $1,000 directly from a subcontractor could be $1,300 through a GC.
- Check the GC’s experience. Are they hands-on, or are they purely a manager? Understanding their level of involvement can help set your expectations.
The Benefits of Hiring Subcontractors Directly
Many tradespeople, like Classic Electric, prefer working directly with homeowners rather than through a GC. When a homeowner hires a subcontractor directly:
- They become the subcontractor’s client. This means all decisions are made with the homeowner’s best interest in mind, rather than being filtered through a GC’s budget constraints.
- They avoid unnecessary markups. Since there is no middleman, homeowners pay for the actual work rather than additional management fees.
- They have better communication. Homeowners can discuss options and upgrades directly with the expert doing the work. For example, an electrician may suggest adding outlets or updating wiring while walls are open—something a GC might overlook in favor of sticking to a strict budget.
How Much to Pay a Contractor as a Deposit
When hiring a contractor, it's essential to understand how much to pay them as a potential deposit before they start work. It is common for contractors to ask for some money upfront to purchase materials, which makes sense depending on the type of contractor, the project, and the materials needed. However, be cautious of any contractor demanding a large deposit before beginning the work. If a contractor requests anything over 25% to 33% of the total project price upfront, it might be excessive and raise red flags. Such a scenario might indicate that they are using your money to fund other projects, which can be risky.
Traditionally, estimates for projects can be generally broken down into two parts: materials (1/3) and labor (2/3). These percentages can vary some depending on whether your project has either a heavy labor component or a heavy material component (for example, a deck build). In the case of a large deck build, it might make sense to pay a $20,000 deposit for $20,000 of decking material after it is delivered to the jobsite. On the other hand, you might be cautious if a contractor asks you for a $40,000 deposit when the materials are only $20,000.
At Classic Electric, we typically don’t ask for any payment upfront; we expect payment only after the work is completed and our customer is satisfied. An exception to this approach is for larger projects that include distinct stages, such as a rough-in stage and a final or trim stage. In these cases, we ask for 70% of the project price at the end of the rough-in stage and the remaining 30% when the project is fully completed. Click here to read more about how to budget for your electrical project costs.
By understanding these practices and setting clear expectations with your contractor, you can ensure a smooth and trustworthy transaction.
Final Thoughts: Making the Right Choice for Your Project
Both GCs and subcontractors have their place in home improvement projects. If you don’t want to deal with scheduling, permits, and coordination, a GC can take on those responsibilities—but you’ll pay a premium for their services. If you prefer more control over your project and want to save money, hiring subcontractors directly may be the better option.
Regardless of which route you choose, the key takeaway is to stay informed about who is working on your home. Keep records of subcontractors, understand your contractor’s role, and communicate openly to avoid unnecessary headaches. With these best practices in mind, you’ll set yourself up for a successful, stress-free home improvement experience.
