what is and is not covered in mark ups on subcontractrs (Home Depot, costs)
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My contractor charges 20% mark up for subs and 15% for materials. He also charges his time whenever he is present at my house (meeting with me and/or subs) as well as when he picks up materials. This seems reasonable.
However, he has also charged time when NOT at my house, explaining that it takes time to coordinate scheduling with the subs. Is this double dipping? I assumed part of the 20% mark up on subs is to cover his time coordinating with them. I've been very scrupulous on recording the time the contractor and his laborers are at the house. The hours agree for the laborers, but his time is almost double the time per my records.
What does his contract say? It should all be spelled out what he is billing for, and the rates.
While its good to keep an eye on all of your costs, trying to micro manage his time may not be worth it. Of course it does depend on what kind of money we are talking about, and the scope of the job.
But it should be all spelled out in the contract.
Typically, the mark up covers home office overhead and profit. Sometimes it also includes insurance. Sometimes it includes bonding (if required). At 20% it should also include the management fee, and maybe even general conditions if he has any.
It has always irked me to pay a contractor to go shopping. They show up at your house, make a list of materials and leave for home depot. Four hours later they come back with the stuff they should have brought with time to begin with. I should not have to pay them to go buy nails, and certainly not to go look at some tool they think they might need.
Look at your contract, if you agreed to pay 20/15% you may be stuck. If not, ask him to show you the actual coots justifying that 20% or just flat our refuse to pay it. If it is a home improvement project, find ot whether your Statee has laws that protect you, many do.
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