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Discussion Starter · #1 ·
I have generally purchased materials for a job and had the subs give me a price labor only. I have a slightly larger than normal job coming up and my sheetrock man gave me a price that was materials included. Typically when he does work for me it's smaller jobs and I have the material on site when he gets there.

I know my company must markup jobs a certain amount to cover business expenses and I'm wondering if subs could operate this way also. So if I were to let the sub buy the materials and mark them up then I would mark up his price again. I want to keep costs low of course but I don't want to cut my subs either, I'm not sure if I'd be harming him or not.

What do you all think?

As for the time that it takes to get the materials to the job I'm not concerned about that. I figure he would charge a bit extra to deal with the materials but that is money that I don't mind making and time that I have allotted for already.

I don't have a price from him without materials so I can't compare the two to see if he is marking up the materials or not.
 

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Tall Moose
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read markup and profit by michael stone.

You need to know your numbers in this business. No one else can tell you yours, nor does anyone elses relate to you.

Certain subs supply materials for me, other times I do. All depends on the job, and how I feel about the logistics of it.
 

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Discussion Starter · #3 ·
I have the book and have read it completely and reference it often. I apply his principles and they are great.

I know my cost of business and i have my markup setup.

What I am asking is seperate from that. Should I let my subs markup materials then I mark them up again? Should I let the subs charge me for handling materials or handle them myself.
 

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If your sub gives you a price, add your mark up and be done with it. As A GC, you are being paid to make sure everything is done correctly. That would include making sure the correct material is used by your subs.

When a sub gives me a price I do not ask for a breakdown unless there is a large difference between what I was given and what I was expecting.

Most of your competition in the Dothan area are hacks, you should be fine as long as you do quality work.
 

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SailingandSuch said:
Should I let my subs markup materials then I mark them up again? Should I let the subs charge me for handling materials or handle them myself.
I would mark them up again, it shouldn't matter to you how he is marking up his costs. He could mark up 2.0 times for labor and nothing on his material and come up with about the same price as if he marked up 1.3 times for the whole job. Then would you be marking up zero on his material? Doesn't make any sense. If your sub wants to supply the material then I would let him, but that's up to you. But make sure to not let other trades start steeling his Sheetrock to use for things that weren't in his bid. I had that issue come up once on a job where the drywall guy kept accusing me of steeling his stuff, not an issue when the prime contractor is the one who supplies the material.
 

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Butcher of wood and metal
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I sub for some builders . I aways provide the material and mark it up. I buy wholesale most of the time so can treat the builder good on the cost.

Another thing about when a sub provides the material is he normally watches the material closer as far as waste goes. Also when providing I have what I need when I need it.am not waiting for material because the yard did not figure enough. It is not my job to tell the GC how much material needs to be ordered. And if he is short that cost me money and time.
 

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My thoughts are let the sub get the material and you need to mark up his/her price. Most of the point of hiring subs is it's something you don't do or don't have time to do. Why get involved, less you have to worry about with good subs. Only time I would worry is if you think they will be bought in credit and not paid for opening up chance for a lien.
 

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We do primarily framing. When we work as a sub in new construction, I have never provided materials. When I sub insurance work, I am always asked to provide materials. Obviously, I mark that up. Whether or not the GC also marks that up, is entirely up to him.
 

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I typically supply the fixtures....if the GC provides them I add my lost markup onto my price....either way I make the same profit.......all my steady prime contractors let me supply them....I handle all the issues...

if the homeowner or GC buys them they always get junk that takes me longer to install...and when there's a problem they expect me to fix it for free...it always creates tension.......from my experience only the lower end GC's provide their own plumbing fixtures or let the homeowner.....the ones that have to scrape for every penny

I know the trend is against me though........the low end GC seems to be 80%+ of the market these days
 

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If you supply the material then you supply the take off and delays if you dont have enough on the job to finish. A crew could charge you a set up fee to come back.

If you let the guy provide materials then all that is his problem but it also should cost you 10% markup.
 
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