Subcontractor
A subcontractor is a party engaged by a main contractor or supplier to perform part of the work under a larger contract.
A subcontractor delivers a defined portion of a project or service on behalf of the primary contractor, who remains responsible to the buyer for the whole. Subcontracting is common in construction, engineering, IT and facilities work, where specialist tasks are handed to firms with specific expertise or capacity. The buyer's contract is usually with the main contractor, not the subcontractor.
Because subcontractors affect quality, timing and compliance without a direct contract with the buyer, main contracts often include controls — approval of key subcontractors, flow-down of standards, and clauses on liability and payment. In Malaysian construction, subcontractor arrangements and CIDB registration are important considerations for governance and eligibility on projects.
Frequently asked questions
- What is a subcontractor?
- A subcontractor is a party engaged by a main contractor or supplier to perform part of the work under a larger contract, while the main contractor stays responsible to the buyer for the whole.
- How do buyers manage subcontractor risk?
- Through main-contract controls such as approving key subcontractors, flowing down quality and compliance standards, and setting clear clauses on liability, performance and payment.
Related terms
Contract Manufacturer
A contract manufacturer is a company that produces goods for another business under contract, usually to that business's specifications.
Read definitionStatement of Work (SOW)
A statement of work (SOW) is a document that defines the specific deliverables, activities, timelines and acceptance criteria for a piece of work under a contract.
Read definitionCIDB Registration
CIDB registration is the mandatory registration with the Construction Industry Development Board that contractors need to undertake construction work in Malaysia.
Read definitionSupplier Risk Management
Supplier risk management is the practice of identifying, assessing and mitigating the risks that suppliers pose to an organisation's operations, finances and reputation.
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