The Challenge of Finding Contractors
Finding new talent in the real estate construction and maintenance business usually means some amount of trial and error.
The head of the Maintenance Department chatted with me about the struggles that his Department is facing lately, and we realized after a bit of chatting that the majority of their problems come down to the same issue: the challenge of finding contractors. That’s not as easy for a property manager as it is for an individual.
Why not? Well…
Contractors generally can be broken down into a few groups, which we covered in a previous blog post. The important part is that they range in price and quality, and those variables don’t always change together. You can totally find a lower-cost, higher-quality contractor – but they usually present other challenges, and it’s those challenges that frequently conflict with ‘being a property manager’.
- Cash-Only Plz: Many of the contractors we reach out to are skilled and reasonably priced, but part of the way they keep prices down is by working entirely under the table – meaning they want to be paid in cash. We’re not going to risk getting our business in trouble with the IRS, so we insist that all of our contractors accept more formal, well-documented methods of payment.
- Pay Now Plz: Similarly, many contractors like to keep their own paperwork costs (and cognitive load) low by insisting on getting paid immediately – like in stop what you’re doing and meet me at the jobsite with your checkbook — for each job as it’s completed. Unfortunately, this doesn’t work for us because our Inspectors need time to get there and do their jobs, and then we need a final invoice to turn into our Accounting Dept. We do pay within 10-15 days though.
- Arrange Everything Plz: Most inexpensive contractors don’t have much by way of administrative support – at most, maybe their spouse is helping out with scheduling appointments or something. This means that they don’t want to be responsible for something like setting an appointment with a tenant, which we ask our contractors to do. We’ve spent too much time playing two-directional phone tag – we provide our contractors with the tenant’s number, and ask them to call on their time and figure out an appointment time that works with both the tenant and themselves. (Though we do step in if they reach out to the tenant a few times and the tenant evades or ignores them.)
- Informal Bids Plz: Another major obstacle that we face in finding new contractors is the tendency of many inexpensive-but-good contractors to want to do everything with a handshake. Or, they just want to send us a quick text “bid”. We’ve learned the hard way such informal agreements rarely end well. The prices and amount of work always seem to change – and not in our favor. So, we have fairly intensely legalistic templated emails that we send out for every major interaction within every Work Order we manage. That can really intimidate some contractors.
- Owner-Occupants Only Plz: Finally, there are a great number of contractors out there that only want to work with homeowners who they can con into pulling their own permits, along with all the other Plz’s We obviously need contractors that can pull their own permits and have the quality of their work pass the corresponding city inspection.
So, we reach out to new contractors almost every week, introducing ourselves and openly acknowledging those of our policies that often cause problems. Many contractors don’t reply back, and some of the ones that do will end up irate because they didn’t read our policies the first time around. The only recourse is to do what we’re already doing – reaching out to new potential contractors week after week, adding the good ones to our Vendors list and letting the ones who can’t cope depart with a minimum of fuss.