Years ago I bought a big house that needed gutting, everything had to be redone.
Mike Greenlees warned me to watch out for sub-contractors.
That’s when you pay your builder to do the work, but he keeps half the money and gets
someone else to do a cheaper job.
When it came to the plumbing, I found the builder was charging me £50,000, he was then
subbing the job out to a plumber for £35,000, who was subbing it to another plumber for
£25,000, who would put a £10,000 apprentice on the job.
Which meant I would be paying £50,000 for a £10,000 job.
So I bypassed the builder and found a decent plumber myself, he did the work without
subbing it out, for £25,000, and I got the job I paid for just by making the effort.
Sub-contracting goes on in all walks of life.
In Guangxi, China, Tan Youhui had a row with another developer called Wei.
Wei threatened to sue Tan, so Tan decided to solve the problem by having Wei killed.
He hired a hitman, Xi Guangan, and offered him £224,000 to do the job.
Xi Guangan kept 50% and subbed the job out to another hitman, Mo Tianxian, for £112,000.
Mo subbed the job out to another hitman, Yang Kangsheng, for £56,000.
Again, Yang deducted 50%, and subbed it out to Yang Guangsheng for £28,000.
Yang Guangsheng kept 50% and subbed it out to Ling Xiansi, for just £14,000.
Ling didn’t think it was worth killing Wei for that money, so he decided to fake it instead.
He contacted Wei and told him he wouldn’t kill him if he’d agree to be tied up and
photographed to make it look like a hit.
Wei agreed and the photos worked their way back up the line to Tan.
Tan Youhui had commissioned the hit and paid £224,000 for a £14,000 job, thanks to sub-
But it ended up worse than that.
After the photos were taken, Wei went to the police and everyone was arrested.
The trial lasted three years, and the average sentence for the hitmen was three years, as
none of them intended to kill Wei.
But the sentence for Tan Youhui, who ordered the hit, was five years, as he was the only one
involved who actually did want to murder someone.
The reverse of sub-contracting is marking-up.
A specialist says they can do a job for a certain price, the builder agrees then adds a huge
mark-up, which is passed on to the client.
Either way, a lot of the client’s money is wasted.
For instance, a client pays an ad agency a fortune to do a campaign, but the people doing
the work don’t see that money, they’re usually marked-up several times over.
The people that actually do the work are a fraction of what the client pays for.
What the client pays for is posh offices, trendy decorations, fancy furniture, awards entries,
lavish entertainment and, of course, large profits for the agency shareholders.
If clients made the effort to deal directly with the people that did the work, they could save
But I don’t honestly think that’s what most clients want.
I think they want the security of going into a big office, seeing account men, planners,
regular email updates, meetings about strategy, consumer insights, brand diagrams.
They’re not just paying for the work, they’re paying for the process.
They could save money but, just like picking a plumber or a hitman, it takes a bit more
effort to deal direct with the people doing the work.
But if you do make the effort, you do get the job you paid for.
Dave Trott is the author of Creative Blindness and How to Cure It, Creative Mischief, Predatory Thinking and One Plus One Equals Three