Do Not Hire a General Contractor Without Asking this Important Question

Having construction knowledge, skills and experience is only one part of the General Contractor equation. One of the most critical roles of a GC is overseeing and managing the financial aspect of the project. 

Purchase Order & Bill Database in our Buildertrend system

So, make sure to ask any General Contractor you are considering working with:

"What is your bookkeeping process?"

Hiring a GC without proper bookkeeping systems and procedures in place, especially on builds requiring multiple trades, will likely result in chaos, confusion and unexpected costs. 

Specifically, you will want to ask:

"Who manages the Books?"

Find out who is responsible for the books to help you make an informed hiring decision. 

Not ideal: the person performing the work and managing the construction is also the one doing the books for your project.

Could work: The person managing the construction of your project is the one doing the books.

Most ideal: There is a designated bookkeeper that handles the books.

"What is your workflow process?"

Ask about their process for handling:

• Purchase Orders

• Change Orders

• Sub and supplier deposits

• Bills and payments

• Lien waivers

• Receipts

• Sales Tax

• Client invoices & payments

"When are you doing the books?"

Depending on your project size, this should be daily or weekly. The GC should be looking at your budget and actuals daily. Find out when they pay their subs and suppliers. Find out when you will need to pay them.

"How do you track Actuals vs Budget?"

This should be done via software. At a minimum, with a comprehensive spreadsheet but ideally, with construction management software (we love Buildertrend).

At any given time, your GC should be able to tell you exactly where you are in your actuals vs your budget. And hopefully they match in the end!

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You are hiring a General Contractor to oversee your construction project from start to finish. You’re investing a substantial amount of money into your project. Make sure the GC you hire knows how to manage the financial aspects of the project properly.

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