Factors Influencing Sub-Contractors Selection in Construction Projects
Factors Influencing Sub-Contractors Selection in Construction Projects
Factors Influencing Sub-Contractors Selection in Construction Projects
HBRC Journal
http://ees.elsevier.com/hbrcj
a,*
KEYWORDS
Sub-contractors selection;
Construction management;
Questionnaire surveys
Abstract Selection of the best sub-contractor is a vital process in construction projects. There are
many factors that must be taken into consideration when selecting sub-contractors. Improper selection of sub-contractors might lead to many problems during work progress. These include bad quality of work, and delay in project duration. This process is controlled by many factors. Forty six
factors are collected from previous studies that inuence sub-contractor selection. This paper identies the most important factors that inuence the selection of sub-contractors. A questionnaire was
distributed to experts in the construction domain to determine the importance of factors that are
taken into consideration by the main contractor to select the most suitable sub-contractor. A survey
was carried out which was conducted with 29 experts in the construction eld to determine the score
of each factor. Statistical analysis is carried out on the feedback of the respondents of the survey. By
using SPSS software, the frequency of the results of the questionnaire was determined. Examples of
crosstabs between some of the most important factors are presented to provide a comparison
between two factors. The mean score of each factor was determined and the p-value was calculated
using the SPSS software, the signicance of each factor used in the questionnaire is determined. Any
factor that has a p-value less than 0.05 is considered a signicant one.
2013 Housing and Building National Research Center. Production and hosting by Elsevier B.V.
All rights reserved.
Introduction
* Corresponding author.
E-mail address: [email protected] (M.M. Marzouk).
Peer review under responsibility of Housing and Building National
Research Center.
1687-4048 2013 Housing and Building National Research Center. Production and hosting by Elsevier B.V. All rights reserved.
http://dx.doi.org/10.1016/j.hbrcj.2013.05.001
Table 1
Country
Denmark
Rejecting the highest two and the lowest two and selecting the contractor
that oers a price closest to the average
Rejecting the highest one and the lowest one and selecting the contractor
that oers a price closest to the average
Rejecting the contractor that oers an abnormally low price
The process is implemented in two stages: rst, evaluating the contractors
experience; second, bargaining for a price then occurs
The lowest bidder is selected provided that the bid is not less than 70 percent
of the owners cost estimate
The lowest price determines the selection
The lowest bidder is selected
The lowest bidder is selected
The lowest bidder is selected. The process occurs in two stages: rst, the
contractors pre-qualication is evaluated; second, the lowest price
mechanism works
Italy, Portugal,
South-Korea
France
Australia
Saudi-Arabia
Turkey
Canada, USA
Lithuania
Iran
151
152
about the effect of the different criteria on the contractor selection process, a survey was conducted, which is considered an
important tool to identify the signicance of each criterion.
A questionnaire is also considered the best method to use in
cases of non-accessibility to documented data. This paper
presents a study on the factors that inuence the selection of
sub-contractors in construction projects. Forty six factors are
collected from previous studies that inuence sub-contractor
selection. This paper identies the most important factors that
inuence the selection of sub-contractors. A survey was carried
out which was conducted with 29 experts in the construction
eld to determine the score of each factor. The size of the sample required from the targeted population is the total number
of contractors registered by the Egyptian Federation for Construction and Building Contractors (EFCBC). The minimum
size of the sample required from the targeted population was
determined statistically according to Kish [6] as per Eqs. (1)
and (2).
pq
V2
n0
1 nN0
n0
n
frequencies of importance level and the mean score for the different factors are listed in Table 3.
Identication of signicant factors
Using the mean score of each factor and calculating the p-value by using the SPSS software, the signicance of each factor
used in the questionnaire is determined. Any factor that has a
p-value less than 0.05 is considered a signicant one. As per
Table 4, the signicant factors are determined based on the
p-value and the mean score. Any factor that has a p-value less
than 0.05 has a mean score of more than 3.00. There are thirteen factors with a p-value more than 0.05, so they are not signicant factors. Although some of the non-signicant factors
have a mean score more than 3.00 this is not an indicator that
these factors can be signicant. The p-value result is a crucial
indicator to the signicance of factors. In this table, determining the signicant factors occurs through identifying their
mean scores and p-value. The mean score which acts as an
identier of the most important versus the least important factor is 3.00. This mean score can be identied as an average
mean score; since a mean score less than 3.00 has no signicance and more than 3.00 is signicant. Therefore, each significant factor is considered of high importance when its mean
score is more than 3.00, and has a p-value less than 0.05.
Cross-tabulation calculations
Crosstab is the comparison between two factors which is done
by using the SPSSsoftware. The crosstabulation is dened as
Across-tabulation and is a two (or more) dimensional table
that records the number (frequency) of respondents that have
the specic characteristics described in the cells of the table.
Cross-tabulation tables provide a wealth of information about
the relationship between the variables [11]. This section presents examples of crosstabs between some of the most important factors only. These factors are: tender price, contractors
difculty in reimbursement, Failure to complete contract,
quality, experience of technical personnel, Suppliers incompetency to deliver materials on time, disputes, and arbitration,
Failure to comply with the quality specications, exibility,
and cooperation when resolving delays, delay, exibility in
critical activities, Reputation, knowledge of construction regulations and physical resources. Table 3 compares between two
of the most important factors which are quality and failure to
comply with the quality specications. When the Quality factor has moderate importance, two of the responses said that
the Failure to comply with the quality specications factor
has the highest importance. Also when the Quality factor has
weak importance, one response gave the failure to comply with
the quality specications factor moderate importance. The total number of responses of both factors is 29, which is the total
responses number of the questionnaire survey. Table 5 clearly
sets a comparison between two factors.
The Quality factor has 13 responses with the highest importance while the Failure to comply with the quality specications factor has different importance rates. On the opposite
side there are 18 responses that gave the Failure to comply
with the quality specications factor the highest importance
while the Quality factor has different importance rates.
This shows that the Failure to comply with the quality
153
Criterion
Factor
Cost
Cost overruns
Quality
Quality
Denition
The cost of the project exceeds the expected value of the project during the
construction stage
Flexibility in payment terms and If there is any exibility from the subcontractor to decrease the cost of one
conditions
item or more
Tender price
It is the price oered by the subcontractor to win the tender (the lowest
price wins)
Sub-contractors diculty in
If the subcontractor nds any diculty in reimbursement to the materials
reimbursement
supplier or in paying the salary of his sta each month
Failure to complete contract
How many projects the subcontractor failed to complete
Financial stability
Whether the subcontractor faces any nancial problems that lead to
nancial instability
Financial references
What is the source of the funds of the subcontractor who applied for the
tender?
Sub-contractors poor
management ability
QA/QC programs
When the laborers of the subcontractor are keen on the process of energy
saving while working with equipment
If the laborers have poor competency especially in time management and
work quality
Experience of technical personnel The years of experience the technical personnel gained in their eld
(technical person: professional laborers like the steel xer, carpenter,
painter)
Decorum, conduct and nonThe way the subcontractors sta deal with others in the projects; whether
disruptiveness of the sta
they maintain appropriate decorum or not
Prevention of vandalism
If the laborers of the subcontractor commit any kind of vandalism in the
work with other subcontractors and the main contractor
Cooperation with the other
The cooperative attitude with other subcontractors and vicinity
subcontractors on the project
and in the vicinity
Creativity and innovation
Whether the subcontractors engineers have the creativity to solve
complicated problems that may face the main contractor and the owner,
and to nd innovative solution
Labor force retention
The memory of the subcontractors laborers when given a specic task
Safety
Suppliers incompetency to
deliver materials on time
Disputes and arbitration
The keenness of the laborers to leave the jobsite clean during and after their
work time
During the construction stage, does the subcontractor cause any air or
water pollution?
Does the sta of the subcontractor maintain safety consciousness on the job
site? (such as safety shoes, hard hat, and other safety precautions)
Is the subcontractor keen on the maintenance and repairing for his
equipment?
Is the subcontractor keen on having equipment with warranty on them?
When the subcontractor does not provide insurance to his sta and
equipment.
If the materials are not delivered on time, leading to a shift in one work
activity or more
Whether the subcontractor have a history of disputes and arbitration in any
previous work
Failure to comply with the
Does the subcontractor fail to abide by the quality specications of the
quality specications
projects?
Lack of readily available utilities Does the subcontractor provide utilities such as bathrooms and oces to
on site
his engineers and laborers?
154
Table 2
Criterion
Factor
Risk avoidance
Time
Reputation
Being familiar with the area or
being domestic
Knowledge of construction
regulations
Volume of work committed
Experience in local area
Scale of projects completed
Denition
When there is a delay -in an item- facing the subcontractor and the main
contractor, how can they both cooperate to resolve this delay?
If the subcontractor is accustomed to time delays in the past projects
How many years has the subcontractor been working in the industry?
How can the subcontractor deal with the critical activities during the
construction stage?
How can the subcontractor deal with the noncritical activities during the
construction stage?
Does the subcontractor have a good Reputation in his surrounding area?
(high work quality, sucient time management and reasonable cost rates)
Is the subcontractor familiar with the area where the projects tender is
located? (for instance owning a local company)
Is the subcontractor aware of important construction laws, such as FIDIC?
The volume of work accomplished by the subcontractor in past projects
What is the experience of the subcontractor in the area of the tender?
The scale of the projects that the subcontractor worked in
Tender
Tender quality
Willingness to tender
Others
Site proximity
difference of eighteen responses. On the opposite side, at different importance rates of the Failure to comply with the quality specications factor, the Flexibility and cooperation when
resolving the delay factor has the highest importance by a difference of fteen responses. This means that the Failure to
comply with the quality specications is more signicant than
the Flexibility and cooperation when resolving delays.
Table 8 shows the relationship between the Failure to comply with the quality specications and the delay factors. As
shown in the table there is no response when the Failure to
comply with the quality specications has the highest importance and the delay has moderate importance. Also at different
importance rates of the delay factor, the Failure to comply
with the quality specications factor has the highest importance by a difference of 18 responses. On the opposite side,
at different importance rates of the Failure to comply with
the quality specications, the delay has the highest importance
by a difference of 15 responses. This means that the Failure to
comply with the quality specications is more signicant than
the delay.
Table 9 shows the relationship between the Failure to comply with the quality specications and the Reputation factors.
As shown in the table there is no response when the Failure to
comply with the quality specications has the lowest importance and the Reputation has a moderate importance. Also
at different importance rates of the Reputation, the Failure
CC1
CC2
CC3
CC4
CC5
CC6
CC7
QC1
QC2
QC3
SC1
SC2
SC3
SC4
SC5
SC6
SC7
SC8
SF1
SF2
SF3
IR1
IR2
IR3
DR1
DR2
DR3
DR4
DR5
TC1
TC2
TC3
TC4
TC5
EC1
EC2
EC3
EC4
EC5
EC6
TD1
TD2
OC1
OC2
OC3
OC4
155
Cost overruns
Flexibility in payment terms and conditions
Tender price
Sub-contractors diculty in reimbursement
Failure to complete contract
Financial stability
Financial references
Quality
Sub-contractors poor management ability
QA/QC programs
Energy saving materials and installations
Poor competency of laborers
Experience of technical personnel
Decorum, conduct and non-disruptiveness of the sta
Prevention of vandalism
Cooperation with the other subcontractors on the project
Creativity and innovation
Labor force retention
Jobsite cleanliness during projects and upon leaving jobsites
Prosecution due to unlawful disposal of construction waste
Safety consciousness on the job site
Onsite plant maintenance and repair programs
Responsiveness to warranty issues
Not buying insurance for major equipment and employees
Suppliers incompetency to deliver materials on time
Disputes and arbitration
Failure to comply with the quality specications
Lack of readily available utilities on site
Risk avoidance
Flexibility and cooperation when resolving delays
Delay
Length of time in industry
Flexibility in critical activities
Flexibility in the noncritical activities
Reputation
Being familiar with the area or being domestic
Knowledge of construction regulations
Volume of work committed
Experience in local area
Scale of projects completed
Tender quality
Willingness to tender
Site proximity
Ongoing work commitments
Physical resources
Relationships with the client
Less
...
...
...
Most
3
0
1
1
3
2
4
0
2
2
7
0
0
1
2
1
0
3
3
3
0
0
3
3
1
1
1
1
2
0
1
0
0
4
0
0
0
1
0
1
2
3
6
1
0
1
2
2
1
1
0
1
5
1
2
3
3
2
2
1
0
2
4
2
4
5
3
2
5
3
2
2
2
7
2
0
0
2
1
5
0
2
3
2
1
2
3
1
4
4
0
1
4
8
3
6
1
6
10
2
6
10
11
9
3
17
7
10
12
11
8
5
6
12
8
10
2
2
2
8
5
4
2
7
7
8
4
7
5
7
9
5
10
7
11
10
4
9
7
10
11
9
7
11
5
13
9
6
8
11
18
7
12
12
9
8
10
13
8
11
9
10
7
7
6
7
11
10
11
13
11
6
10
13
12
16
15
14
6
10
6
8
15
8
13
9
13
12
18
9
5
13
10
8
0
7
6
3
8
4
4
5
4
3
12
4
4
3
17
17
18
6
9
15
15
7
10
6
15
7
9
3
4
7
8
8
2
6
10
10
Mean score
3.86
3.90
4.17
4.03
4.28
3.83
3.07
4.31
3.79
3.52
2.69
3.79
3.97
3.34
3.83
3.55
3.45
3.34
3.28
3.28
4.00
3.59
3.21
3.24
4.28
3.97
4.31
3.34
3.79
4.38
4.34
3.86
4.03
3.17
4.38
3.86
3.93
3.62
3.76
3.83
3.52
3.66
2.79
3.48
4.21
3.86
156
Table 4
Factor
Mean score
SD
p-Value
State
Cost overruns
Flexibility in payment terms and conditions
Tender price
Sub-contractors diculty in reimbursement
Failure to complete contract
Financial stability
Financial references
Quality
Sub-contractors poor management ability
QA/QC programs
Energy saving materials and installations
Poor competency of laborers
Experience of technical personnel
Decorum, conduct and non-disruptiveness of the sta
Prevention of vandalism
Cooperation with the other subcontractors on the project
Creativity and innovation
Labor force retention
Jobsite cleanliness during projects and upon leaving jobsites
Prosecution due to unlawful disposal of construction waste
Safety consciousness on the job site
Onsite plant maintenance and repair programs
Responsiveness to warranty issues
Not buying insurance for major equipment and employees
Suppliers incompetency to deliver materials on time
Disputes and arbitration
Failure to comply with the quality specications
Lack of readily available utilities on site
Risk avoidance
Flexibility and cooperation when resolving delays
Delay
Length of time in industry
Flexibility in critical activities
Flexibility in the noncritical activities
Reputation
Being familiar with the area or being domestic
Knowledge of construction regulations
Volume of work committed
Experience in local area
Scale of projects completed
Tender quality
Willingness to tender
Site proximity
Ongoing work commitments
Physical resources
Relationships with the client
3.86
3.90
4.17
4.03
4.28
3.83
3.07
4.31
3.79
3.52
2.69
3.79
3.97
3.34
3.83
3.55
3.45
3.34
3.28
3.28
4.00
3.59
3.21
3.24
4.28
3.97
4.31
3.34
3.79
4.38
4.34
3.86
4.03
3.17
4.38
3.86
3.93
3.62
3.76
3.83
3.52
3.66
2.79
3.48
4.21
3.86
1.36
0.96
1.01
1.05
1.27
1.16
1.24
0.76
1.21
1.20
1.11
0.92
0.77
0.81
1.07
0.92
0.88
1.15
1.17
1.13
0.98
0.83
1.15
1.06
1.11
1.09
1.12
1.19
1.18
0.73
0.91
0.88
0.86
1.32
0.73
0.86
0.96
0.91
0.75
1.01
1.20
1.23
1.23
1.11
0.67
1.06
0.004
0.000
0.000
0.000
0.000
0.001
0.547
0.000
0.003
0.051
0.244
0.000
0.000
0.073
0.001
0.008
0.025
0.200
0.339
0.106
0.000
0.001
0.200
0.119
0.000
0.000
0.000
0.125
0.002
0.000
0.000
0.000
0.000
0.670
0.000
0.000
0.001
0.000
0.000
0.000
0.051
0.014
0.364
0.024
0.000
0.000
Signicant
Signicant
Signicant
Signicant
Signicant
Signicant
Not signicant
Signicant
Signicant
Not signicant
Not signicant
Signicant
Signicant
Not signicant
Signicant
Signicant
Signicant
Not Signicant
Not signicant
Not signicant
Signicant
Signicant
Not signicant
Not signicant
Signicant
Signicant
Signicant
Not signicant
Signicant
Signicant
Signicant
Signicant
Signicant
Not signicant
Signicant
Signicant
Signicant
Signicant
Signicant
Signicant
Not signicant
Signicant
Not signicant
Signicant
Signicant
Signicant
Table 5
Quality
Total
1
2
3
4
5
Total
0
0
0
1
0
1
0
0
0
2
0
2
0
1
0
1
0
2
0
0
0
4
2
6
0
0
2
5
11
18
0
1
2
13
13
29
157
Failure to comply with the quality specications vs Suppliers incompetency to deliver materials on time crosstab.
Failure to comply with the quality specications
1
2
3
4
5
1
0
0
0
0
1
0
2
0
0
0
2
0
0
0
2
0
2
0
0
1
2
3
6
Total
Table 7
Total
0
0
1
3
14
18
Flexibility and cooperation when resolving delays vs Failure to comply with the quality specications crosstab.
Flexibility and cooperation when resolving delays
1
2
3
4
5
Total
Table 8
Total
0
0
0
0
0
0
0
0
0
0
0
0
0
1
0
3
0
4
1
0
1
1
7
10
0
1
1
2
11
15
1
2
2
6
18
29
1
2
3
4
5
Total
Table 9
1
2
2
7
17
29
Total
0
0
0
0
1
1
0
0
0
0
0
0
1
0
0
1
0
2
0
1
1
3
6
11
0
1
1
2
11
15
0
0
0
0
0
0
0
0
0
0
0
0
0
0
1
1
2
4
1
2
0
3
4
10
0
0
1
2
12
15
1
2
2
6
18
29
1
2
3
4
5
Total
Total
1
2
2
6
18
29
158
Fig. 1