# Subcontracting vs. referring jobs



## coolbrze (Jun 7, 2010)

Do any of you subcontract & refer work out? What % do you try to make off your subcontracting jobs? If referring, we usually ask for a 5% referral fee (fair for both parties), while 10% seems more industry standard (in our area), to give 10% referral fee from a job, a lot of jobs will be marked up too much and will not be awarded. What do you think?


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## tree md (Jun 7, 2010)

I only sub work out when I have more than I can handle and that has not been the case for quite some time. 

When subbing out I pay a daily wage dependent on the experience and productivity of the sub, as well as what equipment they bring to bear. If I am really, really busy I will sub out all I can and once I can't keep up I will start referring. 10% is fair but to tell the truth, I prefer to work it out in trade. Like use of a bucket, log truck or the like. That's how I prefer to do it. I sub out all of my stumps right now but will often just refer the guy on calls I get for stumps only. He knows that I give him good referrals so he does my stumps for about half price. I usually end up making $20 or $40 on the stumps that I sub out to him.

Anyone who refers me or tips me off on a job that I land I pay 10% no questions asked.


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## mckeetree (Jun 8, 2010)

coolbrze said:


> Do any of you subcontract & refer work out? What % do you try to make off your subcontracting jobs? If referring, we usually ask for a 5% referral fee (fair for both parties), while 10% seems more industry standard (in our area), to give 10% referral fee from a job, a lot of jobs will be marked up too much and will not be awarded. What do you think?



I wouldn't give you the time of day for 5%.


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## alanarbor (Jun 10, 2010)

On my end, if I utilize a subcontractor, I usually mark up their cost 10-20% to the client.

If I refer someone, I don't expect referral fees or anything like that. What goes around comes around. They will send work my way, and that is my "fee" so to speak.


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## tailhold (Jun 10, 2010)

Wow referral fee's Huh,
Really.


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