Trade Partners are hired by contractors to assist them in completing specific tasks that are typically part of a larger project. Trade partners can often execute work faster since they are highly experts in specific specialized areas.
Trade Partnering usually involves the following steps:
1. A buying agency hires a contractor to complete a project.
Contractors undergo a bidding process prior to selection.
2. The contractor hires trade partners to do specialized work on certain parts of the project.
For instance, a contractor might employ a trade partner to finish the HVAC system of the project. The contractor may have established ties with trade
partners with whom he or she prefers to deal, or the contractor may take bids from a number of trade partners and select the best one.
3. The trade partner and the contractor agree to a set contract for the work.
Once a contractor selects a trade partner, they typically sign a contract with the payment details and terms of the job.
4. The contractor issues work instructions to trade partners.
The contractor and the trade partner communicate both ways with regards to updates all throughout the project.
5. The contractor pays the trade partner once their portion of the project is completed.
Some contractors pay upon completion, while others wait until the client has paid to pay the subcontractor.
Trade Partners typically form a long-term professional connections with a single contractor that engages them for all of their projects. They may also work for a variety of contractors and companies, submitting bids for contracts.
