Are main contractors always cheaper than IDs?

Honestly, no. The market tells you otherwise, but it all depends on the structure of the renovation firms, and how they carry out your renovation.

Watch our tiktok video on this if you lazy to read.

Recently, we have noticed a trend of customers asking for main contractors over IDs.

The main reason is due to the “cheaper” price since it “cuts out the middle man”.

And we wanted to clear up this misconception.

First, let’s understand their roles.

Interior Designer - Manages the renovation project, more design-driven, helps homeowners to imagine the space

Main Contractor - Manages the renovation project, more technically-driven & experienced, executes homeowners’ vision

The distinction between both roles are not very clear to begin with. Some companies brand themselves as IDs, but are more “executors”, while some main contractors outsource their design to become and ID. And we have not talked about those “design & build” companies, who in-house everything.

Second, there are so many factors that affect the renovation pricing. All else equal, it depends on the number of mark-ups in the renovation process.

Above shows 2 common renovation process.

Subcontractors are specialists in certain field. For example, hacking, tiling etc. Most companies outsource the job to these subcontractors and manage the entire process. Only a certain portion might be in-house.

Now, an ID or main contractor can work directly with subcontractors, resulting in only 1 level of “mark-up”. Hence, all else equal, it is possible that an ID is even CHEAPER than a main contractor. It depends on the “mark-up” that they take.

Now, there is a 3rd scenario, which (we believe) leads to this misconception of IDs being much more expensive than contractors.

An ID can outsource the entire renovation to a main contractor, who then liaises with the subcontractors to carry out the job.

In this case there are 2 “mark-ups”, and of course, the price will start shooting up.

Hence, 1 key determinant of the price is the firm’s renovation process. Do they outsource their works, and to what extent do they outsource it?

Our suggestion?

Get a main contractor if you (i) want someone more experienced in the execution of the renovation (ii) know exactly what you want

Else, get an ID who can help you make your home your castle.

Pricing is important, but don’t make the assumption that IDs are always more expensive than main contractors.

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