Jan 27

Subcontractor Vs. Vendor: What’s the Difference?

Every industry has specialized terminology that individuals must familiarize themselves with to be an educated consumers. The construction services industry is no different. Two terms that people often need clarity on are subcontractors and vendors, as there tends to be confusion between them. Read on to learn more about the differences between subcontractors vs. vendors and why they matter to your construction project. 

Subcontractor Vs. Vendor: What's the Difference?

General Differences Between Subcontractors Vs Vendors

In the simplest of terms, a subcontractor provides their services to a primary contractor as part of a project. In the case of vendors, they sell their products or services directly to customers or businesses 

Things to Know about Subcontractors

If you are a prime contractor for major projects or you own a company that requires specific tasks to be completed within a limited amount of time, it’s likely that you will need to hire subcontractors to help you finish a job. Subcontractors can be used as additional manpower or may provide specific expertise that a contractor may not have within their existing staff.  Most subcontractors are hired temporarily for individual jobs. Once the construction job is complete, the contracting company may choose to hire them again for another job or they may choose to work with another subcontractor. 

Companies that offer pre-construction services, for instance, may hire subcontractors to help with construction design. Alternatively, some companies may hire subcontractors to help with a service that is related to theirs but one that they don’t provide themselves (i.e., mechanical, plumbing, electrical, etc.). 

All About Vendors Vs. Subcontractors 

A vendor’s offerings may be specific and varied according to the industry in which they work. For example, there are vendors that supply grocery stores and those that serve large businesses through their consulting services. There are also vendors selling or supplying automotive parts to car companies who need their products.

Vendors often work in a competitive environment because customers will almost always compare a product offered by one vendor with that of the goods coming from another vendor within the same market. They also compare performance, guarantee, price, and suitability before actually choosing the vendor they want to buy from. In the case of large companies, it is a typical scenario to deal with several vendors just to make sure they get the supply they need without resorting to shutting operations down in case one vendor cannot provide their requirements. 

How are Subcontractors and Vendors Managed?

Companies are expected to meet with their subcontractors regularly, particularly when there are issues that need to be resolved and questions that need answers. Both subcontractors and vendors need to be managed to make sure that they are meeting your expectations and fulfilling the terms of their contracts. We hope that this information has cleared up some of the confusion between subcontractors vs. vendors. A construction project will include both, so it is imperative that you work with a trustworthy construction company that has a strong network of subcontractors and vendors. For more information, feel free to contact us at Gidel & Kocal Construction, Inc. today.