This Is Why Your Contractor Sucks (And How to Fix the Relationship)

TLDR

Contractor problems make more sense when you see the tight margins, low-price competition, double-booked schedules, and indecisive customers behind them. Align on priorities, set the scope, and pay fast for completed work. You still own the vision, expectations, and accountability.

Table of Contents

• The Reality of Running a Contracting Business
• Why They Double-Book You
• The Margin Trap
• Get Aligned on Priorities
• You Are the CEO
• FAQ

The Reality of Running a Contracting Business

I’ve been flipping for fifteen years. The biggest issue is dealing with contractors. They suck, right? Always asking for more money, not showing up, costing you all kinds of headaches.

There’s more to the story. I’ve been a professional general contractor for over a decade too, doing jobs for customers. I know both sides. Let me show you what’s actually happening so you can have a better relationship with the guys you hire.

The Front-End to Back-End Slide

Does it ever seem like the contractor gets started fast and everything’s going well, then the back half of the job slows down, they stop answering the phone, and the work stalls out?

Here’s why. To run a contracting business, you almost always have to have more work lined up than you can actually do. Just because work is lined up doesn’t mean you can produce on it. Things come up:

• permitting delays
• inspections blocking progress
• Problems found in the walls, such as termites or old electrical
• Customer changing their mind on paint color or cabinets
• Waiting on customer payment

Any of those stop production. No production means no revenue. So contractors have to over-book just to stay afloat. If one job gets held up, they go to the next one.

Why They Double-Book You

Think back to when you hired your contractor. What if they’d said, “I got another project going, I can start yours in six weeks”? You would have said no and hired the other guy.

So they tell you they can start right away. But they still have to finish the current job. Now they’re juggling two. Crews get split. Focus gets split.

I wish it wasn’t that way. It is. These guys are thinking about paying their crew, keeping food on their family’s plate, and keeping the next job lined up. They don’t have the luxury of sequential scheduling.

Pro Tip

The amount of work you can offer is one of the contractor’s priorities. A contractor who sees a next job with you has a different reason to protect the relationship than a one-and-done vendor.

The Margin Trap

You might think “I paid them a ton of money, how do they need two jobs at once?”

Here’s the math. On a twenty-thousand-dollar job, gross profit is around fifteen percent. So three grand. That three grand has to cover:

• General liability insurance
• Administrative employees
• Marketing
• Office, vehicles, gas
• Equipment and tools (they break all the time)
• Legal and accounting

What’s left is not the same as the revenue collected. Ross’s point is that construction margins are really tight after direct costs and overhead.

The Race to the Bottom

Why are margins so tight? Construction has been around forever and prices have been squeezed for decades. Some guys work out of their basement with no insurance and no license. The legit contractors compete against those prices. Everyone is giving the cheapest bid they possibly can.

So when you ask for a bid, here’s what happens. They look at your job and give you the best-case-scenario price. They’re not lying. They’re trying to win the work. If they gave you the honest answer (“We might open those walls and find termites, the electrical looks old, we might have to rewire the whole house”) you wouldn’t hire them. You’d hire the other guy.

Then when walls open and reality shows up, change orders happen. That’s how the industry has evolved.

Same thing with timelines. The guy who says “We’ll have this done in seven days” gets hired. The guy who says “These off-market houses can run eight to twelve months” doesn’t.

Dumb Mistake

A low bid or fast timeline may reflect the best-case scenario the contractor thinks can win the job. Compare the assumptions and understand that hidden conditions can still create changes.

Get Aligned on Priorities

Contractors have different priorities beyond just price. Figure out which ones match yours:

As an investor, you care about price being fair (not cheapest) and schedule being reasonable. So spend your non-price currency on the other priorities.

How to Win on the Non-Price Stuff

Give them independence. Don’t hover. Create a great scope of work so they know exactly what’s expected, then let them execute.

Pay extremely fast. When they finish the agreed work, get there that day with a check. Quick payment goes further than almost anything else. These guys have been burned by customers before.

Watch your perfectionism level. You’re doing real estate investments, not the Taj Mahal. Some basics have to be right. Safety. Code. No shoddy hidden work. But the floor doesn’t have to be dead-flat and the drywall doesn’t have to be museum-grade.

Don’t sneak in freebies. “While you’re here, could you also do this other thing?” with no extra pay. That kills the relationship. They take pride in finishing the job you agreed to. Extra scope throws them off their finish schedule.

Stick to the plan. Some contractors love indecisive customers because of the change-order markup. Most hate it. Be decisive.

You Are the CEO

Here’s where the biggest problem comes in. A lot of investors hire a contractor and expect them to be the expert on every piece of the rehab. That’s not how it works.

No matter how much relationship capital you build, no matter how aligned you are on priorities, you still need to own the strategy. The real estate organization you’re building may have operations managers (contractors or a general contractor), but the CEO is you.

That means:

1. Cast the vision. Where is the project going? What’s the finish package? What’s the budget?
2. Set expectations through the scope of work. Make clear what the job should become.
3. Hold accountability to those expectations. Follow up on the plan you set.

You need to understand how to build a scope of work. What to expect from contractors. Which contractors fit what kind of project. When you’re the one causing issues (indecisive, late-paying, unclear scope).

Actual Bad Contractors

Most contractors are good people in a hard business. There are real bad actors. Here’s how to spot them:

Cutting corners. You set a clear scope. They didn’t complete it. They tried to hide the miss, usually inside the walls.

Excessive change orders. Some change orders are legit. A bad contractor banks on change orders. They already have permits so you can’t get rid of them. They purposefully don’t tell you about things they knew were coming.

The contractor black hole. They start, everything’s going well, then they ghost. Very common in this game. See my separate video on the ten dirty contractor scams for more.

FAQ

How do I know if I’m the problem instead of my contractor?

Audit yourself. Do you change your mind mid-project? Do you pay late? Is your scope of work vague? Do you keep adding tasks without paying? Do you expect the contractor to do work they never bid? If any of those are yes, you’re contributing. Fix your side first.

Should I always pick the highest bid?

No. The source explains why the lowest bid may reflect a best-case scenario, but it does not tell you to choose the highest bid. Compare the actual scope, assumptions, exclusions, schedule, and contractor fit.

What if I found the perfect contractor but they’re booked?

The source’s example is the pressure a contractor faces when telling a new customer that the start is six weeks away. It does not prescribe a standard waiting period. Ask for the honest start date, decide whether it fits the project, and use the wait to finish the scope of work.

Does getting three bids have a relationship cost?

It can. Ross is not saying never to compare bids. He is saying that repeatedly asking a contractor to spend time bidding jobs they never win burns some relationship capital. Treat the tradeoff as part of the decision.

When does payment become due in this teaching?

Pay quickly when the agreed scope of work or milestone is complete. The source does not set a hard-money draw deadline or a fixed number of days.