Do you buy your contractor materials and tools?

Question

I’m in the middle of a rehab and the contractor is doing a pretty good job. I’m buying the materials but the contractor is doing some of the shopping. I’m finding a lot of little things like sponges, buckets, and knives along with lumber and tile and stuff. Should I be paying for those items or do you expect your contractor to have these things?

Josh C. · Answer

@Ralph Chiaia

I think sweating buckets and razor blades is penny wise pound foolish. Happy contractors are better that contractors who think you are being stingy.

Worry more about the quality and design than this little dumb stuff.

Rick Wade · Answer

I wanted to add my 2 cents as a contractor.

I want to start by stating that I am only replying to general practices that I adhere to, I do not know what you have worked out with your guy. I also want to point out that just because someone is working on your flip does not make them a contractor.

I charge in whatever way that makes my client comfortable. Simply put, if you are not paying a premium, why would I supply consumables. If you are paying a premium, I would expect to supply the consumables. I have a guy doing a flip for me in another city, his prices seem a little low to me. I supply him with all consumables. As to collecting them at the end of the job, feel free, but as one of the people here stated, act cheap...get treated like you are cheap. Most consumables are just that, consumable and if used for your job is most likely somewhere into the life of the consumable and may not be worth you collecting.

It is important for all investors to understand that we do this to make money, not to make money for you at the detriment to us. You are in investing and should reap rewards for this, but I am not responsible for whether or not you make money. Find someone that will work with you and if you treat them right, they will be around and help you make money from your investment. One way to achieve this is to offer some type of small pay and some percentage based on your profit, that would get buy in from the person doing your work.

I hope this helps.

Rick

Corby Goade · Answer

There's no standard- as you can see from all of the responses above. The real key here is mutual trust, and I'm guessing that since you are asking the question, there's a lack of trust somewhere here. Could be that the contractor has done or said something that gave you pause, OR it could be that you are having a hard time letting go of some of the control or details here.

In either occasion, it's vital that you have an excellent working relationship with whichever contractor that you hire and you, in general, let them do their job and trust that they have your best interests in mind. It's rare that happens on your first or second job, it'll probably take sorting through some crappy ones to find one that you can just let go of the reigns and spend your time working on the next deal.

Best of luck-

Bonnie Low · Answer

Your contractor should provide ALL the tools. If they don't have them, you have to wonder how experienced they actually are. That would be like taking your car to the mechanic and having them tell you they're going to need you to provide a socket wrench....as for materials, we DO sometimes buy the materials, but always discuss it first with the contractor so it's clear who is providing what. We do this for a couple of reasons: we either want something very specific, or we have leftover material from a previous project that we want to use in a new one, or we have a discount of some kind, and lastly because contractors often charge markup if they have to shop for you, which makes sense because you're paying for their time.

Sarah Brown · Answer

If you are paying for materials, then consumables would arguably get paid in that also.  Take what he doesn't use at the end of the job.

Raymond Temprano · Answer

Those items should be included with their estimate. You should be getting charged for extra things they did not account for.

Rick Estacio · Answer

@Ralph Chiaia - Hey Ralph, fellow Brooklynite here.  Where do your buy the materials for your rehab?  Brick and mortar or have you found good online places to purchase building supplies?  Looking to do multiple renovations and looking for a good source for materials.

Ralph Chiaia · Answer

Hi Everyone who Responded!

First off, thanks for jumping in. The answers really helped me articulate myself to my contractor and bring up a sticky situation. I didn't want to imply that he was stealing but did want him to account for these buys. After organizing all the items in a big list I called the contractor and we went through them item by item. He had balanced some little costs for things I should have paid for with some little things that he paid for. This was not an awesome move by him since I'm on a construction loan and the bank is checking every dollar I spend. I told him to cut that out in the future. Although I'm annoyed, I think he was more guilty of being a poor accountant than a dishonest guy. So part of me is relieved and another part of me feels stupid for not being more on top of this out of the gate. That's on me and my partner. The good news is I'm handling all the buying directly now so none of this comes up. A corollary of riding him in such painstaking detail is that my contractor and I seem to understand each other a lot more. I feel like this helped clear the air and get us on the same page more. Sometimes a little bit of throwing your weight around helps. I agree with the many people who said don't sweat the small stuff. I think I'm guilty of doing that and feel like it didn't do any good in this case. What was important was just to communicate a bit.

I just wanted to check in with everyone who commented. Thanks. This community really helps put things in perspective. Some days I feel like it's overwhelming. This is my first commercial loan. It's also my first 10 unit property.

Matt M. · Answer

@Ralph Chiaia

I do a lot of time&materials jobs for my investor clients. 9/10 times the houses are run down foreclosures and houses of that nature. These clients I’ve been with for a long time. They hand me the keys and off I go, and I usually don’t even see them until the end. I actually dislike when clients buy materials, they never get the right stuff, try and cheap out, and don’t have the knowledge of knowing what else I’ll need that’s not on the list. I don’t mark up the materials, but my time to run and get stuff is all part of my time. Never ever would I try to sneak a tool into my bill. A sponge to wipe tile, box of screws, etc absolutely. Everything that’s left (that can’t be returned) goes in my van or my shop. When I have to do repairs for them in the future at their rentals, I’ll just use what I have and they know this. I’ve seen plumbers itemized bills with 10 drywall screws billed. Yeah, no. I’ve never had a materials bill scrutinized or questioned.

I’m very lucky to have some amazing clients!

Philip Coiro · Answer

@Ralph Chiaia

I wouldn’t worry about sponges , buckets and small disposable items as being tools. If it were items larger than that, things that get kept from job to job that’s a different story

Do you buy your contractor materials and tools?

Most Popular Reply