If your family or business is planning a construction project, you can help assure your project’s success by selecting a qualified general contractor. Business owners and homeowners can mitigate construction risks by asking a lot of questions up front and weighing several factors before hiring a contractor. Keep in mind that a building contractor needs to be a business owner first and a contractor second. To be successful with any construction project, the contracted company must properly manage its business.
Your methodical evaluation process can help you measure the contractor’s ability to make multiple complex decisions, weigh the results of those decisions and draw reasonable conclusions from that information. A successful project usually has its roots in a solid contractor prequalification program.
Carefully consider these factors when selecting a contractor for your project:
- Company experience – Examine the contractor’s qualifications and experience; ask for past customer reviews and company history.
- Current projects and existing workload – Does the contractor have the capacity to give your project the attention it deserves and complete the project in a timely manner? Ask to see a current project list.
- Financial stability – Ensure that the contractor is on solid financial ground. Make sure the contractor has the appropriate insurance coverage and the financial capacity to be bonded to assure completion of the work. Request audited financial statements or, if you are a business owner, purchase a Dun & Bradstreet report. Be sure to request a copy of the company’s certificate of insurance. The certificate of insurance should list the name of the insurance company (or companies) insuring the contractor, policy numbers, the types of insurance coverages provided by the referenced policy and the policy expiration date.
- Safety – Find out whether the contractor has effective training and orientation programs for employees. Consider whether management maintains appropriate oversight of the work and ask to see the company’s OSHA logs and safety training records.
- Quality – Determine whether the contractor has documented programs to assure quality of workmanship and that applicable training is in place. Check for the appropriate manufacturer training certificates or installer credentials.
Identifying these issues can help you determine whether a contractor is a good fit for a particular project. Carefully analyze data submitted by prospective contractors: It would be unwise to rely only on a contractor’s answers without objective verification from other sources, such as listed references or past clients.
Finally, contractors that depend on qualifications-based selections and reputation focus on satisfying their customers. A good contractor knows that future opportunities are based upon performance, service and reputation rather than simply the lowest possible project solution at the cheapest price.
This loss control information is advisory only. The author assumes no responsibility for management or control of loss control activities. Not all exposures are identified in this article.