Building Contractor Relationships: 7 Critical Steps

Companies often use general contractors to carry out specific jobs in the modern global economy. However, managing contractor relationships is sometimes challenging.

Disconnects between hiring companies and contractors threaten successful and timely projection completions. As such, businesses must establish and maintain strong working relationships with outside contractors to prevent delays and poor performance.

This article will examine some of the top techniques for developing better working relationships with contractors.

7 Steps to Building Better Relationships with Contractors

Building stronger contractor relationships is essential for creating a positive and productive work environment. Here are some steps you can take to build stronger contractor relationships:

1. Offer Transparency from the Start

Building solid relationships with contractors starts before the company hires them. Three critical pre-hiring steps are as follows:

• The company should present a clear and transparent proposal to all potential hires, including a precisely defined project scope.

• After reviewing each candidate’s response to the proposal, the company will choose the best contractor for the task considering their skills, resources, and knowledge. 

• The company will draft a contract outlining the project’s requirements, scope, timeline, and roles. 

Hiring companies will build the necessary foundation for the business relationship by completing these steps concisely and transparently.

2. Supply the Right Tools and Training

Contractors need access to the proper tools to finish projects successfully, which might include the following:

• Clarified documents
• Additional training
• Specialized equipment
• Upgraded technology

Granted, meeting these requirements might require help from third-party experts, but hiring companies should know upfront what contractors will need to do their jobs. Companies do their part to ensure everyone is safe on the worksite by supplying the necessary tools.

3. Build a Personal Connection to Strengthen your Contractor Relationships

Hiring companies might also take the time to build deeper relationships with their contractors, including getting to know them personally. The company personnel overseeing the contractor’s project could schedule an informal meeting to learn more about the following:

• What motivates the contractor?
• What are their professional goals?
• What are they passionate about?
• What do they enjoy doing during their free time?

Of course, the hiring company should not delve too deep into the contractor’s personal life, but showing a genuine interest in them as people can foster a stronger sense of connection and trust.

4. Track Progress with the Contractor

While all parties agree on a plan and process before starting a project, situations change, and things can go awry. 

Companies should employ a contractor management system that helps them keep track of progress and adapt to these unforeseen developments. These solutions should help the company maintain the following:

• Timelines
• Checklists
• Incident reports.
• Progress reports

These solutions help ensure contractors understand the milestones they must achieve and can also keep them motivated.

5. Foster Open Communication

Hiring companies can encourage open communication with general contractors by making themselves available to answer questions and provide regular feedback on their work.

• Create a chain of command in work contacts.

• Design a communication plan that predetermines the communication method based on urgency (i.e., a non-time-sensitive topic should be an email, but an urgent one should be a phone call).

• Schedule periodic safety update meetings and refresher courses to follow up on incidents.

• Establish “open door” hours for workers to approach management to discuss concerns. 

• Set expectations early (and clearly) to minimize future confusion.

These steps will help to build trust and strengthen the relationship.

6. Evaluate Contractor Performance to Improve Contractor Relationships

Hiring companies should regularly evaluate the performance of their contractors and provide constructive feedback. This process will help identify improvement areas and promote continuous growth and development.  

An objective and quantifiable means to evaluate progress is via KPI monitoring. Metrics the company tracks might include the following:

• Check-In compliance. This metric tracks when contractors arrive at the worksite. Hiring companies use this to confirm that workers follow the schedule and the proper check-in procedure. 

• Location-based KPIs. Companies managing multiple sites must measure contractor performance at each facility, as they will most likely use different contractors and have unique performance numbers. They can use location-based KPIs to determine the most successful contractors.

• Response time. Monitoring the response time helps the hiring companies understand how long it takes a contractor to arrive and fix a problem after internal personnel creates the work order. 

• First-time completion percentage. Hiring companies should know the rate at which contractors fix problems on the first attempt. This metric is critical because addressing project issues more than once increases expense and diminishes efficiency.

• Work order completion percentage. This KPI helps companies determine the proportion of planned work orders that contractors finish. This calculation sheds light on the dependability and reliability of the contractor. 

Ongoing evaluations help the company stay on top of contractor successes and areas for improvement. Addressing any issues with the contractor sooner rather than later helps them correct errors before they escalate.

7. Recognize Achievements

Management can increase morale, establish stronger working relationships, and build trust by rewarding good contractor performance.  Effective means to do so include the following:

• Publishing the recognition on the company website
• Encouraging contractors to post awards on their websites
• Highlighting excellent performance in newsletters
• Announcing them at award ceremonies or similar events

By following these seven steps, hiring companies can build stronger contractor relationships and create a supportive and engaging work environment for their workers.

Building the Best Contractor Relationships Requires the Best Contractor Management Software

Developing trusting working relationships with contractors is essential for any project to be successful. Companies can establish these connections by devoting time and effort to outlining clear expectations, encouraging two-way communication, working together, and cultivating mutual trust and respect.

However, hiring companies sometimes need help managing contractor information, including most recent contract terms, compliance criteria checklists, licensing certificates, and up-to-date proof of insurance. Any delays caused by mishandling this critical data could harm the relationship.