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What Are Contractors Like?
Jim Olsztynski

A soul-searching quest for common ground.

Periodically I get calls from market researchers asking for industry statistics or for me to explain our industry’s lay of the land. One of them recently asked the question, “What are contractors like?” My initial response was to ask a question in return: “Which type of contractor?” Then I explained that the industry harbors different kinds of work specialists - residential vs. commercial, construction vs. service, plumbing/hydronic heating/HVAC/process pipefitting and so on - each with different characteristics and concerns.

Later, in reflecting back on this conversation, I asked myself whether there might be some unifying characteristics among all of these different market sectors. After all, for the last 23 years I’ve been presiding over a magazine that attempts to appeal to all of them. Instinctively, I know they have things in common but have never bothered to articulate them.

My soliloquy led to the following conclusions:

Pride in craftsmanship. It saddens me to see this eroding over time as the industry grapples with relentless cost-cutting pressure, but there still are plenty of old school pipe trade workers and contractors who place doing the job right above all else. These people transcend the residential/commercial, construction/service and other divides.

In visiting contractors over the years, I’ve always been struck by how many of them go out of their way to show off their handiwork in projects large and small. I can recall times I’ve been driven miles out of the way just to view a building housing some interior installation not even visible from the outside. It was enough to know that the contractor or his crew had a hand in creating something special.

Tightfisted. I mean this with respect. Contractors are always driving for bargains and they pinch pennies tighter than owners in most other businesses. They’ve been conditioned to do so by the tiny margins and competitiveness of their line of work. Contractors in the bid markets have to contend with tight budgets and only a few missteps - or even one large one - can kill their business. Construction estimating is inherently imprecise, yet the margin for error miniscule.

It’s been observed only half-jokingly that losing a job means you’ve bid too high, while winning a job means you’ve bid too low. Saving a few bucks on materials and squeezing out a few economies on the labor front often spell the difference between profit and loss.

Camaraderie. Contractors form bonds of brotherhood more readily than any other business owners I’ve observed. You don’t hear as much backbiting and badmouthing of competitors as you do in other fields. Even those who repeatedly bid against one another tend to view other contractors as colleagues more than competitors. At association meetings, you’ll often find neighboring contractors sharing details of each other’s business to a degree that would be unthinkable to business owners in most other fields. Many contractors who are too busy to handle a given job will refer it to a competitor.

Supply chain community. This sense of community extends throughout the supply chain. Contractors like buying familiar brand names from traditional supply houses. That’s why Home Depot has never made significant inroads in its long quest to more deeply penetrate the trade market. It’s always struck me as curious why contractors are so accommodating toward fellow contractors who compete against them for work, but hold fierce grudges against any supply house or big box they perceive as competing against them for material sales. It appears to be an empathy factor. Contractors can relate better to tradespeople like themselves than they can to merchants that make their living selling things.

Wedded to the tried and true. Contractors as a whole tend to be close-minded about trying out new products, techniques and business methodology. While this can be interpreted as a negative trait, it’s understandable. Given the tight margins and serious consequences of mistakes in their inherently risky business, most contractors prefer to fall back on proven reliability over time. It takes a lot of persuasion and incentives to convince them to try something different.

Because every job intrinsically involves a roll of the dice, they tend to be gambling-averse in those areas for which they exert greater control. When conventions are held in Las Vegas, you don’t see contractors hit the gaming tables as hard as most other business owners. “We gamble every day,” I’ve heard them explain.