This criteria should be modified to fit your company’s volume
of subcontracted business and its financial situation.
However, having and consistently following established guidelines is key, as is support from top management within your
company. Most important, do not cut corners or pass on a
review of a subcontractor; it will eventually cost your company
both money and its reputation.
Benefits of Prequalification
A prequalification process provides for more informed,
deliberate decisions when hiring subcontractors and demonstrates your company’s dedication to improving quality
for your clients. An ongoing prequalification process builds
a database of dependable subcontractors for future jobs
and helps eliminate repeat contracting with subcontractors
that perform poorly. Moreover, it encourages a measurable
review process and quality control.
From the downstream party’s perspective, sharing the
results of your evaluation with each subcontractor provides
an opportunity to improve. Discussing the outcomes or
challenges identified during an in-person review with a
subcontractor can be extremely beneficial for both parties.
It gives the subcontractor a chance to understand, ask ques-
tions, and address any confusion that surrounds the review
process. Additionally, as the contractor, you have the oppor-
tunity to meet face-to-face with the partner you are about to
The overall goal of the prequalification process is to increase
deliberate decisions when hiring subcontractors, thereby
reducing the chances of claims, budget overruns, and project
Prequalification for Upstream Parties
While a prequalification process is critical for your subcontractors, there should also be a process for your upstream
parties. As a downstream party, your goal should be to
engage in a dialogue with the GC or owner. Ask questions
about how you will be evaluated for the project and bid
process even before you bid. This will provide insight into