Hi Gang,
I’m beginning to do more work with another contractor in my area and the projects are getting increasingly larger. We’ve discussed how we might structure our arrangement and I was wondering if anyone has any knowledge to share based on their experiences.
For the record, I’m aware that partnering is difficult and doesn’t work out too well most of the time.
If anyone has found techniques though to manage some of the problems I’d love to hear them.
We’ve got to work out details like paying our wages during larger projects, managing different responsibilities, and how to split up the profits when it’s all done.
Thanks in advance,
Bart
Replies
I've done this several times and it's worked out well. Decide who's working for who (this can change project by project) and who's responsible for what before each project. Who's gonna warrant the final result, etc.
What ever you do, don't flip the red switch on the dashboard, Gunner.
http://grantlogan.net/
The one method that works well in most situations is to simply have one contractor in charge of each job and the other contractor works like a T&M subcontractor as far as pay goes. Who is running each job doesn't really matter, but I'm sure it's pretty clear in most situations which of you are better at the various types of projects.
When the job is done the two go over who did what for whom and divy up the profit. This keeps the money flowing along an easy path that everyone already understands, each contractor can allocate their manpower and equipment between jobs as they see fit and in the end it's easy to write one check to share the profits.
The hard part is probably finding how to split the profits so both are happy.