The FMP Blog

What Does a Commercial Contractor Do?

  • January 9, 2024

Commercial building projects require a lot of planning. From budgeting the construction costs to acquiring necessary permits, project owners couldn’t complete everything by themselves.

That’s where a professional commercial contractor comes in. They are trained to care for every aspect of the building process.

For commercial work, a specialized type of construction service is required. This article will discuss:

  • What a commercial contractor is
  • What a commercial contractor does
  • The benefits a commercial contractor brings to a construction project
  • When and how to find the best commercial contractor

Contents:

1. What is a Commercial Contractor?

2. What Does a Commercial Contractor Do?

3. The Benefits of Hiring a Commercial Contractor

4. When to Hire a Commercial Contractor

5. How Much Does Hiring a Commercial Contractor Cost?

6. How to Choose a Commercial Contractor

7. Recap

What is a Commercial Contractor?

A contractor specifically trained to handle project management for commercial building construction is called a commercial contractor. 

What’s the Difference Between a Commercial Contractor and a Residential Contractor?

Residential contractors are hired by homeowners to work on new homes or additions to their current residence. On the other hand, commercial contractors are hired by project owners to work on a commercial construction project, such as:

  • Stores
  • Restaurants
  • Warehouses
  • Hospitals
  • Government buildings
  • Additions or renovations to current commercial buildings 

Commercial contracting is more complex than residential contracting, with more building codes to follow and more subcontractors involved. They’re also more extensive, meaning they have a longer time frame and require more materials to complete.

Commercial Contractor vs. General Contractor

A general contractor can work on almost any project with their general knowledge of the construction industry. Meanwhile, commercial contractors are more knowledgeable to aid in the construction process in the commercial sector. 

A general contractor is like your family doctor, while a commercial contractor is your specialist. They have gone on to learn a more specific skill with a deeper understanding. 

What Does a Commercial Contractor Do?

Commercial contractors wear a lot of hats during the construction process. Let’s discuss some of their primary responsibilities. 

Project Management

Commercial contractors will be very aware of the timeline they are facing to finish the project. They’ll outline the phases and create anticipated schedules for each one.

To ensure they meet their deadlines, these contractors will source and order materials with a long lead time so that construction isn’t held up waiting for materials to arrive. 

Commercial contractors are also involved in pre-construction tasks. Since they’re keenly aware of the ins and outs of the project, cost of materials, and estimated labor hours needed, they provide price estimations.

Site preparation is another responsibility on the commercial contractor’s list. Depending on the project, this could include extensive excavation and soil leveling. Preparing the site for construction also means guaranteeing the utilities are connected and ready to use. 

Designing

During the design phase, commercial contractors are invaluable, especially in design-build projects. 

They must communicate with the project owner to understand the exact needs and objectives of the task. They can then design the structure to meet these objectives. 

Commercial contractors can implement value engineering whenever possible to provide their clients with a sustainable and cost-saving project. 

Learn more: A Project Owner’s Guide to Commercial Building Design

Budgeting

Speaking of cost savings, commercial contractors are directly involved in project budgeting. Construction budgeting can be a complicated process involving direct and indirect costs. 

However, due to the experience and knowledge of commercial contractors, they can accurately estimate the capital needed for each project. They will also conduct budget reviews and assessments throughout the project to ensure the money stays on track. 

Permitting and Legal Compliance

Permitting and Legal Compliance

Commercial contractors apply for local and federal permits before beginning construction. They also ensure the project meets regulations by following building codes and zoning regulations.

Human Resources

A commercial project requires various experts’ skills, often outsourced to subcontractors. The commercial contractor is responsible for finding and hiring them. 

Subcontractors often included in a commercial project are:

  • Plumbers
  • Electricians
  • Flooring specialists
  • Interior decorators
  • Painters
  • Landscapers

Vetting these subcontractors requires some personnel management on the commercial contractor’s part. They must check each one’s qualifications and collect the necessary documentation for a project contract. 

Material Sourcing

Commercial contractors will also proactively search for the best source of materials. They’ll compare the price and value, and then proceed to purchase and order the products they need, ensuring there are enough materials for the project’s unique requirements.

They will also need to check on the supply chain and transportation so that everything is available when needed. To do this, commercial contractors have to be in communication with the production line and distribution. 

Quality Inspections

Commercial contractors will perform periodic reviews of the subcontractor’s quality of work. They also check on the materials received before allowing them to be installed.

As the project’s leader, commercial contractors manage any disputes between subcontractors, vendors, or any other party that could negatively affect the project’s progression. 

Record-Keeping

Completing a project requires a lot of record-keeping. Commercial contractors do this through several avenues, like tracking:

  • Spending
  • Material use
  • Vendor invoices

They also record milestone completions and issues that come up, such as change orders. 

Most commercial contractors use a BIM (building information model). Multiple parties can access and update this digital version of the project. It helps to keep everyone up to speed and the project organized and on-target regarding schedule, financials, and design. 

Project Completion

After construction is finished, commercial contractors perform a final overview to ensure all work meets a high standard. This includes overseeing cleanup and finishing touches. 

These final tasks can be just as important as the initial ones. Leaving them out could result in an incomplete project, resulting in even more significant ramifications. 

The Benefits of Hiring a Commercial Contractor

You may wonder if your project really needs a commercial contractor. After all, it will require a more considerable investment. 

When you hire a commercial contractor, here are some of the critical benefits you can expect to see:

Organization

In a design-build project, a commercial contractor will be involved from pre-construction to completion. They’ll know the ins and outs of every part of the project and the construction company team members.

This knowledge allows the contractor to keep everything organized. Miscommunication and shifting blame will be minimized since they have a broad view of the goings-on. 

Access to a Broader Network

handshake

Commercial contractors benefit from being in contact and up to date with the newest and best vendors, building materials, and subcontractors available in the area.

They will provide a broader network of material resources as well as more connections with engineers, architects, and construction workers.

Cost Savings

Organization and access to a broader network also translate to an even bigger benefit: cost savings. 

The ability to find a wider variety of labor and materials, as well as keep the project organized, helps the commercial contractor stay within your budget.

They can often find better prices on materials and labor using their industry knowledge and connections. 

Faster Timeline

Trial and error makes any process take a significantly longer amount of time. However, commercial contractors are experienced and have these processes down to a science. 

They know when to start one task — often before another is complete — and can ensure each stage is ready for the next one. 

For commercial contractors to be successful, they can’t wait and see. They have a “get things done” attitude. 

One Single Point of Contact

As we’ve already discussed, commercial contractors improve the organization of the project. One of the main reasons is their broad overview of every aspect. 

Everyone goes to the contractor for questions, updates, and concerns. 

This results in better communication and collaboration of all involved.  It also ensures everyone gets the same documents, updates, and files so that no one is left out of the loop. 

Safer Construction Site

Commercial contractors understand the importance of keeping a clean and organized construction site.

They also know that the safety record of your project can influence not only your insurance premiums but also your commercial reputation, so they take extra precautions and don’t cut any corners.

This high regard for safety will also result in fewer accidents and injuries, costing you less in worker’s compensation.

Better Compliance

Good commercial contractors know the laws and regulations and can ensure your project meets or exceeds them.

Zoning regulations, building codes, permitting, and the intricacies of the local authorities can be a tricky sea to navigate. With a commercial contractor by your side, you won’t have to be overly anxious about these necessary processes. 

When to Hire a Commercial Contractor

Does every commercial project need a commercial contractor? The easy answer is yes. 

Here are some key instances in which hiring a commercial contractor is important:

  • Before you begin a new construction project
  • When you’re making a large addition to your commercial structure
  • When you’re planning a major renovation to your current structure
  • Your project is in a historical district or requires multiple trades to complete
  • Your project is under strict budgeting or timelines

How Much Does Hiring a Commercial Contractor Cost?

Most commercial contractors charge by the project, not hourly. The cost will greatly depend on the scope of work involved and the project’s square footage

A contractor will always supply a fee estimation for their work during the bidding process, generally following one of the three most popular contract models: 

  • Lump Sum
  • Cost Plus Fee
  • GMP (guaranteed maximum price)

How to Choose a Commercial Contractor

Gaining the benefits listed above requires the help of a qualified and experienced commercial contractor. 

Depending on the location of your project, you may have many contractors to choose from. How can you be sure you found the right one?

First, you should find and vet several of them. You could hire a commercial contractor outside the area, but picking one familiar with the climate, local regulations, and project site would be wiser. 

Of course, you’ll want to make sure the contractors you choose have a specialty in commercial projects. Invite those who pass your initial qualifications or seem to be a good fit to bid on the project.

Check their years of experience, licenses, and certifications. Ask for proof of insurance and safety records to make sure you’ll be covered in any accidents resulting in property damage or injury. 

Confirm if they have warranties or guarantees. Ask for testimonials from past clients. Check their ratings on the Better Business Bureau website.

  • Do they have a good track record?
  • What are they known for?
  • Is there a pattern of negative results?

These are all crucial questions to have answered before you hire a commercial contractor. 


Recap

As we’ve discussed, hiring a commercial contractor for a commercial project comes with a plethora of benefits — but not just any contractor will do.

If you’re looking for a commercial contractor with years of experience who is dedicated to the safety, integrity, and quality of each and every project, we’re here to help. 

Contact FMP Construction today if you are in need of a commercial contractor for your next project.

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