Definition of Subcontracting

Subcontracting is a process of contractual agreement with a third party to perform a certain amount of work. The third party is known as subcontractor. The most common example of subcontracting can appear in the construction industry where builders subcontract the tasks like plumbing, electric work, woodwork, etc.

Explanation

• It offers several advantages.
• It is less expensive
• Gives more time to focus on major tasks
• Multiple tasks can be conduct simultaneously
• However, there are some disadvantages as well.
• Loss of control over quality and on-time completion of tasks
• Lack of effective communication between contractor and subcontractor