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What is a Subcontractor?

What is a Subcontractor?

A subcontractor or ‘Subbie’, is an independent contractor executing services on behalf of a head contractor. A subcontractor is technically a business (Either an individual, multiple individuals or a company) and as a result are generally treated as businesses as per Australian legislation. 

A subcontractor can:

  • Work for themselves (Regardless of business structure)
  • Work for multiple contractors
  • Work with multiple clients
  • Negotiate their own contracts and terms of engagement
  • Hire employees
  • Hire other subcontractors
  • Usually use their own tools, arrangements and methods to perform the required services. Note: Services executed will need to be compliant with the relevant legislation governing the role/industry.

A subcontractor must (Where applicable):

  • Hold relevant trade licences, qualifications and certifications
  • Hold insurance (Public Liability Insurance & Professional Indemnity Insurance are the most common). It would be wise to also get insurance on the products that you use as a subcontractor such as tools, equipment or machinery.
  • Ideally, have signed agreements with the contractors they work for the provision of their services.

As a business, subcontractors hold different types of risk to employees. One of those risks is the promise of work. 

To be a successful subcontractor, you should:

  • Continue to grow your network, put your name out there! List your business for free on for head contractors to be in touch!
  • Secure and document arrangements via written agreements
  • Gain an understanding of pricing before negotiation with the head contractor
  • Vet employees you hire
  • Maintain a stellar reputation. Head contractors value reliability.
  • Invest in the right tools and don’t cut corners!
  • Use modern software to manage your business.
  • Continue to seek feedback from clients and head contractors
  • Undertake relevant training that applies to your profession and in particular, areas that you may have a weakness in.
  • Become a peacock – Work on your business image and stand out from the crowd! Start with creating a professional logo on Looka.

5 Tips to becoming a successful subbie!:

  1. Don’t burn bridges! None of us can walk on water.
  2. Don’t just go for the cheapest option! This applies when hiring other subbies, employees and even using equipment. Think of your clients first!
  3. Customer/client service is key to maintaining a resilient long-term relationship
  4. Quality of work is key to maintaining your image
  5. Keep your business and skill sets up to date!

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