In 2016, U.S. construction starts are estimated to grow at least 6% to $712 billion. This comes after increases of 9% in 2014 and 13% in 2015. There is enough work, more than an industry can handle, which is why it is not expected to slow down any time soon.
However, general contractors must watch out for subcontractor defaults. Some companies have even created a more demanding prequalification process.
Contractors must be able to say no to clients. They must be equal, so as not to give one subcontractor too much work. They also must do a better job with safety records, prior performance, and financially prequalifying their subs.
The rise of construction business increases the risk of subcontract defaults. General contractors must minimize this risk. One way to reduce your risk is with a disciplined subcontractor prequalification process and a prudent policy of securing subcontractor performance and payment bonds. To learn more about AssuredPartners NL’s construction team and services that will help you protect and grow your company, visit AssuredPartners NL Construction.
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