Getting and Comparing Subcontractor Quotes

Getting accurate quotes from subcontractors and comparing them intelligently is a critical skill for owner-builders. A good quote process helps you budget accurately, choose the right contractor, and avoid costly surprises mid-project.

This guide will teach you how to request quotes that are actually comparable, understand different pricing structures, spot red flags in bids, and make smart decisions that balance cost with quality.

Why the Quote Process Matters

The problem: Many owner-builders get quotes that seem similar but include vastly different scopes of work, making comparison impossible. Or they choose the lowest bid without understanding what's included, leading to change orders and cost overruns.

Real example:

• Quote A: $15,000 for framing (includes labor only)
• Quote B: $18,000 for framing (includes labor + sheathing + house wrap)
• Quote C: $12,000 for framing (includes labor only, assumes owner provides all materials on-site)

Which is cheapest? Can't tell without understanding what's included.

The solution: Request detailed quotes with identical scope, understand what you're comparing, and make decisions based on value, not just price.

Types of Quotes

Subcontractors price work in different ways:

1. Lump Sum (Fixed Price)

What it is: Single price for complete scope of work

Example: "$35,000 to frame your house per the attached plans"

Pros:

• Know exact cost upfront
• Contractor absorbs risk of cost overruns
• Simple to compare
• Easy to budget

Cons:

• May include padding for unknowns
• Changes result in change orders
• Less flexibility

Best for: Well-defined scope, complete plans, standard construction

Common trades: Framing, roofing, siding, cabinets

2. Time and Materials (T&M)

What it is: Pay for actual hours worked plus materials used

Example: "$65/hour for labor + materials at cost + 15% markup"

Pros:

• Pay only for actual work
• More flexible for changes
• Can be cheaper if work goes faster

Cons:

• Unknown final cost
• Requires trust and oversight
• Can go over budget
• Contractor has incentive to work slowly

Best for: Uncertain scope, remodel work, small projects, repair work

Less common for: New construction (use lump sum instead)

3. Unit Pricing

What it is: Price per unit of work completed

Example:

• "$8.50 per square foot of drywall hung"
• "$125 per linear foot of foundation"
• "$15 per square foot of roofing installed"

Pros:

• Easy to calculate for different sizes
• Fair pricing based on actual quantity
• Can adjust for scope changes
• Transparent pricing structure

Cons:

• Need to measure/verify quantities
• Final cost depends on exact measurements
• May not account for complexity

Best for: Projects where quantity is main variable

Common trades: Concrete, drywall, roofing, flooring, painting

4. Cost-Plus

What it is: Actual costs plus fixed percentage or fee

Example: "Materials and labor at cost + 20% contractor fee"

Pros:

• Transparent pricing
• No incentive to use cheap materials
• Fair for both parties

Cons:

• Unknown final cost
• Requires detailed accounting
• More paperwork
• Need to verify costs

Best for: Complex projects, high-end work, trusted relationships

Less common: For standard construction

How to Request Quotes

The quality of quotes you receive depends on the quality of information you provide.

Step 1: Prepare Your Request for Quote (RFQ)

What to provide to every contractor:

1. Complete Plans

   • Architectural drawings
   • Structural plans (if separate)
   • Relevant details and specifications
   • Site plan

2. Written Scope of Work

   • Exactly what you want them to include
   • What you'll provide vs. what they provide
   • Any special requirements or constraints

3. Project Timeline

   • Desired start date
   • Completion deadline
   • Any critical milestones

4. Site Information

   • Address
   • Access constraints
   • Utilities available
   • Material delivery details

5. Specifications

   • Material brands/grades required
   • Finish standards
   • Code/energy requirements
   • Any specific methods required

Sample RFQ document structure:

PROJECT: New single-family home construction
ADDRESS: [Your address]
OWNER-BUILDER: [Your name and contact]

SCOPE OF WORK: Foundation and Basement Walls

Work includes:
- Excavate for foundation per site plan
- Form and pour footings per foundation plan
- Form and pour 8" concrete basement walls
- Install foundation waterproofing and drainage system
- Backfill foundation after inspection
- Grade rough finish around foundation

Materials to be provided by contractor:
- All concrete (3,000 PSI minimum)
- All rebar and wire mesh per structural plan
- All forming materials
- Waterproofing materials (specify brand if required)
- Drain tile and gravel

Materials to be provided by owner:
- None (full turnkey)

Timeline:
- Desired start: June 1, 2024
- Estimated duration: 7-10 days
- Must complete before: June 15, 2024

Special requirements:
- Must coordinate with building inspector for footing inspection
- Must protect all excavation until concrete work complete
- Must remove all forms and clean site

Plans: See attached foundation plan dated 4/15/2024

Step 2: Send RFQ to Multiple Contractors

How many quotes to get: 3-5 per trade

Why this number:

• Too few (1-2): Can't compare, may overpay
• Right amount (3-5): Can compare, see market rate
• Too many (6+): Diminishing returns, wastes time

How to send:

• Email is fine for initial contact
• Follow up with phone call
• Provide all documents electronically
• Offer to meet at site if they prefer

Timeline to allow:

• Simple projects: 1 week for quotes
• Complex projects: 2 weeks for quotes
• Custom work: 3 weeks for quotes

Follow-up:

• If no response in 3-4 days, call
• If they need more time, that's fine
• If no response after 7-10 days, move on

Step 3: What to Ask For in the Quote

Minimum requirements for every quote:

1. Total Price

   • Bottom line number
   • Broken down by labor and materials (preferred)

2. Scope of Work

   • Detailed description of what's included
   • Explicitly state what's excluded

3. Payment Terms

   • Deposit amount
   • Progress payment schedule
   • Final payment terms

4. Timeline

   • Start date
   • Completion date or duration
   • Any schedule assumptions

5. Materials Specification

   • Specific brands/grades
   • Who provides what
   • Allowances (if any)

6. Warranty

   • What's covered
   • How long
   • How to make claims

7. Insurance and License

   • Confirmation they're licensed
   • Insurance coverage amounts
   • Will provide certificates

Red flags in quotes:

• Vague scope ("frame house")
• No payment terms specified
• No timeline provided
• "Materials TBD" or unclear specs
• No warranty mentioned
• Missing contact information
• Handwritten on scrap paper
• Spelling/grammar errors throughout

Green flags:

• Detailed scope broken down by task
• Clear payment schedule
• Specific timeline with milestones
• Named materials and specifications
• Professional format (letterhead, formatted)
• License and insurance info included
• Contact information clear

Understanding Quote Components

Break down each quote into these elements:

Labor Costs

Typical ranges by trade (per project, not hourly):

Variations based on:

• Geographic location (higher in cities, coasts)
• Project complexity
• Access and site conditions
• Finish level
• Timeline (rush = premium)

Material Costs

Who provides materials matters:

Option 1: Contractor provides all materials

• Pros: One-stop shopping, contractor manages ordering/delivery, warranty included
• Cons: Contractor markup (10-30%), less control over brands, may use cheaper options
• When to use: Full turnkey, busy schedule, trust contractor

Option 2: Owner provides all materials

• Pros: No markup, choose exact brands, potentially cheaper, can shop sales
• Cons: Timing risk, wrong quantities, storage issues, no contractor warranty on materials
• When to use: Want control, have time, know what you're doing

Option 3: Hybrid (owner provides some, contractor provides others)

• Pros: Control on key items, contractor manages difficult items
• Cons: Coordination complexity, potential delays, unclear responsibility
• When to use: Strategic approach to save money on big-ticket items

My recommendation:

• Specialized trades (plumbing, electrical, HVAC): Contractor provides materials
• Commodity items (lumber, drywall): Consider owner-provided to save markup
• Finish items (fixtures, flooring, cabinets): Owner provides for brand control

Markup and Profit

Standard contractor markups:

• Materials: 10-30% above their cost
• Subcontractors: 10-20% if GC hires subs
• Overhead and profit: 10-20% on labor

As owner-builder:

• You eliminate GC markup
• But pay retail for materials (no trade discount)
• Net savings: 15-25% typically

What's fair:

• Contractors need profit to stay in business
• 15-20% overall margin is reasonable
• Lower margin = may cut corners or quality
• Higher margin = may be overpriced or includes premium service

Contingency and Allowances

Contingency: Percentage added for unknowns

• Typical: 5-10% on complex projects
• New construction: Should be minimal (plans are complete)
• Remodel: Higher contingency makes sense

Allowances: Placeholder pricing for TBD items

• Example: "$3,000 allowance for plumbing fixtures"
• Understand: You'll pay actual cost, may be more or less
• Get clear: How allowance overages are handled

Watch for:

• Large contingencies on well-defined work (padding)
• Allowances that seem low (will lead to overages)
• Unclear allowance terms

Comparing Quotes (Apples to Apples)

You received 3-5 quotes. Now compare them intelligently:

Step 1: Normalize the Quotes

Create a comparison spreadsheet:

FRAMING QUOTES COMPARISON

                    Contractor A   Contractor B   Contractor C
Total Price:        $38,000       $42,000        $35,000
Labor:              $38,000       $32,000        $35,000
Materials:          Owner provides $10,000       Owner provides
Timeline:           3 weeks       2 weeks        4 weeks
Start date:         June 1        June 15        June 1
Payment terms:      10/40/40/10   25/50/25       15/35/35/15
Warranty:           1 year        2 years        90 days
Sheathing:          Included      Included       NOT included
House wrap:         Included      NOT included   NOT included
Cleanup:            Included      Extra          Included
License verified:   Yes           Yes            Yes
Insurance verified: Yes           Yes            No
References:         Excellent     Good           Haven't called

Now you can actually compare.

Step 2: Identify Differences in Scope

Common scope differences:

• Materials included vs. owner-provided
• Cleanup and disposal
• Permit fees
• Site prep
• Protection of completed work
• Supervision vs. labor-only
• Warranty length and terms

Ask each contractor:

"I'm comparing several quotes. Can you clarify if [specific item] is included in your price?"

Get everything in writing.

Step 3: Adjust for True Cost

Add costs to make quotes comparable:

Example:

• Quote A: $35,000 (doesn't include sheathing)

• Sheathing cost: $3,000

• True cost: $38,000

• Quote B: $38,000 (includes sheathing)

• True cost: $38,000

• Quote C: $42,000 (includes sheathing + house wrap)

• House wrap value: $800

• True comparable cost: $41,200

Now compare: $38,000 vs. $38,000 vs. $41,200

But also consider:

• Quote B has shorter timeline (value?)
• Quote C has longer warranty (value?)
• All have verified insurance? (requirement)

Step 4: Evaluate Beyond Price

Create weighted decision matrix:

Winner: Contractor B (even though not lowest price)

Why: Best combination of value, quality, timeline, and references

Red Flags in Quotes

Watch for these warning signs:

1. Significantly Lower Than Others

The quote: 30%+ lower than other bids

Why it's concerning:

• May not understand scope
• Will cut corners
• Planning to use substandard materials
• Will add change orders later
• Desperate for work (struggling business)

Example: Three quotes: $38,000, $40,000, $42,000, and one at $28,000

Action: Ask detailed questions about how they're so much cheaper. Usually reveals the issue.

2. Vague or Incomplete Scope

The quote: "Frame house per plans - $35,000"

Why it's concerning:

• Leaves room for interpretation
• Unclear what's included/excluded
• Sets up disputes later

What you need:

• Detailed scope breakdown
• Specific inclusions and exclusions
• Material specifications

3. Large Upfront Payment

The quote: Requires 50%+ deposit

Why it's concerning:

• Standard is 10-20% deposit
• Large deposits indicate cash flow problems
• Reduces your leverage
• Higher risk if they abandon project

Never pay more than 25% upfront

4. No Timeline Specified

The quote: Price and scope but no start/end dates

Why it's concerning:

• No commitment to schedule
• Can delay indefinitely
• Can't plan other trades

What you need: Specific start date and duration/completion date

5. "Allowance" for Everything

The quote: Multiple large allowances for standard items

Example: "$2,000 allowance for framing lumber" (should know exact amount)

Why it's concerning:

• Lazy estimating
• Will lead to overages
• No incentive to control costs

Acceptable allowances: Finish items where you haven't selected specifics yet

6. No License/Insurance Information

The quote: Doesn't mention licensing or insurance

Why it's concerning:

• May not be licensed
• May not have insurance
• Doesn't think it's important

Required: Verify separately, don't just trust quote

7. Pressure to Sign Immediately

The quote: "This price only good until end of day"

Why it's concerning:

• High-pressure sales tactic
• Good contractors don't operate this way
• Usually indicates desperation

Reality: Legitimate quotes are valid for 30-60 days typically

8. Handwritten or Unprofessional

The quote: Scribbled on a napkin or torn paper

Why it's concerning:

• Indicates unprofessional operation
• Hard to enforce later
• May not be legitimate business

What you need: Professional quote on letterhead or email

Price Ranges by Trade

Typical costs for 2,000 sq ft new home (your area may vary):

Use these ranges to:

• Spot obviously high or low bids
• Budget realistically
• Understand what affects pricing

Remember: These are estimates. Your costs will vary based on location, complexity, finishes, and market conditions.

Negotiating Quotes

Yes, you can negotiate. Here's how:

What's Negotiable

• Price (within reason, 5-10% possible)
• Payment terms (timing of payments)
• Timeline (start date, duration)
• Scope additions (include more for same price)
• Material selections (upgrade/downgrade to adjust price)
• Warranty (longer coverage)

What's Not Negotiable

• Code requirements (must be met)
• Insurance/licensing (non-negotiable)
• Quality standards (don't compromise)
• Unrealistic timelines (can't rush quality)

How to Negotiate

Approach 1: Compare with other quotes

"I have another quote that includes [X] for a similar price. Can you match that scope?"

Approach 2: Ask for value adds

"I'm choosing between you and one other contractor. If you could include [specific item], I'd go with you today."

Approach 3: Adjust scope to meet budget

"I love your approach, but I'm $3,000 over budget. What could we remove to hit my number?"

Approach 4: Promise future work

"I plan to build again in 2-3 years. If we can work well together on this one, you'll be my first call."

Approach 5: Offer flexibility

"I'm flexible on timeline. If you can fit me in during a slow period, what kind of price could you offer?"

What NOT to Say

Don't:

• "That's way too expensive" (insulting, no data)
• "I can get it cheaper on Craigslist" (then do that)
• "I'll pay cash if you lower the price" (asking for tax evasion)
• "My buddy says that should cost half" (your buddy isn't the professional)

Do:

• "I'd like to work with you, but I need to stay in budget. Can we find a solution?"
• "I have quotes ranging from X to Y. Here's what I'm looking for..."
• "What would bring the price down while maintaining quality?"

When to Walk Away

Don't negotiate if:

• Price is already fair for quality offered
• Contractor seems annoyed or offended
• You're asking for unrealistic reductions
• They've already given you their best price

Quality contractors won't:

• Slash prices 20-30%
• Compromise on quality to meet your price
• Work for below-market rates

If they won't budge: Either pay their price (if fair) or choose another contractor

Making Your Final Decision

The decision process:

1. Eliminate Any Quote That Has Red Flags

• No license/insurance
• Unprofessional quote
• Vague scope
• Unrealistic pricing (too low)
• Poor references
• Bad communication

2. Compare Remaining Quotes Apples-to-Apples

• Adjust for scope differences
• Calculate true comparable cost
• Consider all factors, not just price

3. Check References One More Time

• Call references for top 2-3
• Ask specifically about value for money
• Confirm they'd hire again

4. Apply Decision Matrix

• Weight factors by importance
• Score each contractor
• Calculate weighted totals

5. Trust Your Gut

• Who do you want to work with?
• Who communicated best?
• Who seems most reliable?
• Who do you trust?

The winner should:

• Have competitive pricing (not necessarily lowest)
• Have excellent references
• Demonstrate quality work
• Communicate well
• Have proper licensing and insurance
• Give you confidence

After You Choose

Next steps:

1. Inform the winner

   • Call personally
   • Confirm price and scope
   • Discuss next steps
   • Schedule contract signing

2. Thank the others

   • Professional courtesy
   • Keep relationships for future
   • They may refer you to others
   • You may need them if first choice falls through

3. Get everything in writing

   • Create proper contract →
   • Include all quote details
   • Add any negotiated changes
   • Both parties sign

4. Don't start work without contract

   • Handshake + quote is not enough
   • Protect yourself legally
   • Clarifies expectations

Common Mistakes

1. Choosing Lowest Bid Automatically

Why it's wrong: Lowest bid often has highest total cost

Real cost = Bid price + Change orders + Delays + Rework + Stress

Better approach: Choose best value in mid-range

2. Not Getting Enough Quotes

Why it's wrong: Can't gauge market rate, may overpay

Better approach: Get 3-5 quotes minimum

3. Providing Incomplete Information

Why it's wrong: Get quotes that aren't comparable

Better approach: Detailed RFQ to all contractors

4. Ignoring Non-Price Factors

Why it's wrong: Price isn't everything

Better approach: Use weighted decision matrix

5. Not Clarifying Scope

Why it's wrong: Assumptions lead to disputes

Better approach: Ask about every potential difference

Quote Comparison Checklist

• [ ] Requested quotes from 3-5 contractors
• [ ] Provided identical scope to each
• [ ] Provided complete plans and specs
• [ ] Received detailed written quotes
• [ ] Verified each quote includes:
  • [ ] Total price
  • [ ] Scope of work
  • [ ] Payment terms
  • [ ] Timeline
  • [ ] Materials specifications
  • [ ] Warranty terms
  • [ ] Insurance confirmation
• [ ] Identified scope differences
• [ ] Adjusted quotes for apple-to-apple comparison
• [ ] Checked references for top candidates
• [ ] Created decision matrix
• [ ] Considered all factors, not just price
• [ ] Made decision based on value
• [ ] Ready to create contract

Next Steps

Once you've selected your subcontractor:

1. Create Contract → - Formalize the agreement with proper contract

2. Understand Payment → - Know when and how to pay

3. Manage the Work → - Day-to-day management for success

**Remember