There are many types of contractors. Some do small, remodeling jobs, some develop real estate, and others build large projects, such as schools and complex recreation centers. Here are six main types of contractors:
Small renovation contractors
Small renovation contractors work on jobs that don’t require large organizations or estimates. They seek work to improve someone’s home or business facility. Usually working with a small crew of handy-men, they will manage the paperwork of the business at night or on weekends. If a small renovation contractor is skilled at both the physical work and the paperwork, he or she often will aspire to become a general contractor and move up to larger jobs.
Real estate developers
Real estate developers typically own some land to build homes or commercial properties on. They may build single-family dwellings or multi-family houses to sell for a profit before or after the construction projects are completed.
General contractors are experts in most aspects of construction, and states require passing a rigorous exam before the GC license is issued. Some general contractors build homes, some build commercial spaces, and others build for municipalities as public works. There is some crossover, but normally a general contractor will see its areas of strength, weakness, and likes and dislikes, then focus on being very good at one particular niche. When a general contractor has a “specialty,” their bids for new projects carry more weight and credibility with city councils, owner, and construction committees. This is why you will see several large, similar construction projects by the same contractor in a particular city. The general contractor has earned trust and knows what it’s doing.
Owner-builders are usually large companies that construct properties for their own use or to lease out to tenants. Some of the owner-builders will sell their project after completion. It is common to see an owner-builder who also makes contracts to build for other parties.
A professional construction manager works for the owner of a project to organize and supervise all aspects of the build. The construction manager charges a fee to run the job. He may be one individual or a group of people. They normally have no risk of financial assets. They will pay the employees or subcontractors and manage all paperwork of the project, but all is done in the name of the owner.
Package builders often do everything from start to finish. This includes acquiring the land, financing the project, designing the plans with architects and engineers, and doing the construction project itself. A package builder may contract with an architect or home design drafter, or they may hire the designers and pay them in-house; however, this requires more licensing to “own” your own architect or engineer.
A sponsor-builder may take on the whole gamut of a government project for subsidized housing: land acquisition, design, building, leasing, property management, maintenance, etc. In this regard, a sponsor-builder is similar to an owner-builder because they have all the duties. The sponsor-builder usually hires an attorney to assist in the legalities of the project.
Article by: Clear Content Marketing