Subcontracting vs building your own customer book

Every self-employed gas engineer meets this fork, usually in the first year. One road is subcontracting: work handed to you by heating firms, warranty networks, housing providers or busier engineers, at a rate they set. The other is your own book. The honest comparison is not about which pays more per day, but about what you are buying with the difference.

What does subcontracting actually look like?

It takes several shapes here. Contractor work, where an installation firm or builder hands you installs and first fix. Panel and network work, where a manufacturer, insurer or home emergency provider allocates breakdowns through a portal. Social housing and letting agent contracts covering a volume of annual safety checks. And overflow from a busier engineer. What they share is the shape: the firm holds the customer, sets the price, and you supply labour against their schedule.

What does your own customer book look like?

It is a list of properties with dates against them. A homeowner you fitted a boiler for becomes an annual service. A landlord you did one CP12 for becomes a CP12 every year, then a second property, then the agent managing both. Direct work starts thin and lumpy, but it has a property sub work does not: it compounds. After a few years the annual cycle alone fills much of the diary before you have advertised anything.

How do the numbers compare: rate against margin?

The trap is comparing a subcontract day rate with a direct one as though they were the same unit. On sub work the rate is usually all you get: no materials margin, no call out premium, often no paid travel, and no way to price a difficult job higher than an easy one. What you save is real too: no quoting time, no marketing, very little chasing. On direct work you set the price and keep the materials margin, but a share of every week goes on quotes that never convert.

So compare effective earnings per working day across a month, not headline rates across a job. Take what the month brought in, subtract materials, fuel and the cost of winning the work, then divide by the days you worked. Do that for a few months of each and the comparison stops being opinion.

What does each do to your cash flow?

Direct domestic work is close to immediate: the customer pays on the day by card or transfer, or within a few days on an invoice. Subcontract work runs on the payer's terms, measured in weeks rather than on the day, and on their processes: job sign off, portal approval, a monthly payment run. You are effectively lending working capital to a larger business while buying your own parts.

There can be a tax layer on top. Where the work is construction work paid by a contractor, the Construction Industry Scheme applies and a slice of each payment goes to HMRC instead of you: 20% if you are registered, 30% if not. Those deductions count towards your tax bill, but leave your account months before Self Assessment settles up. The boundary is sharper than most expect: installing a heating system is within the scheme, replacing a boiler in an existing system is not.

Who owns the customer relationship?

On sub work, the firm does. Their name is on the quote, their number is on the customer's fridge, and the renewal date sits in their system rather than yours. Many subcontract agreements say so explicitly, with non-solicitation clauses barring you from approaching that customer directly for a period after the job. Read those clauses before you sign.

What does not transfer is responsibility for your own work. Whoever paid you, the gas work was carried out under your Gas Safe registration, and the records carry your details. If a job comes back, it comes back to you, regardless of whose invoice the customer received. On sub work you can end up carrying the workmanship liability without holding the relationship that would let you sort it out directly.

What does each do to your diary?

Subcontracting fills the diary but does not let you shape it. Jobs arrive allocated, in the order and geography the firm chooses. Your own book is the opposite: uncomfortably quiet at first, then increasingly yours to arrange. Safety checks and services can also be pulled forward into the quiet months without moving anyone's renewal date, smoothing the seasonal swings.

How does the hybrid transition work?

Almost nobody jumps straight from employment to a full book, and there is no prize for trying. The workable route is to sub while you build: treat subcontract days as the floor that pays the bills, then defend a fixed number of days each week for your own customers.

When does each model actually suit?

• Subbing suits the newly qualified: volume, variety and other people's judgement to learn from, without needing a reputation you have not had time to build.
• It suits anyone going self-employed without a savings buffer, because it removes the thin months at the start.
• It suits engineers who dislike selling and chasing payment enough to trade some margin for never doing either.
• Your own book suits established engineers with a local name, since the marketing cost is already paid and the work largely refers itself.
• It is the only one of the two that builds goodwill you could sell, because a diary of renewal dates is an asset and a subcontract relationship is not.
• One caution on the sub side: working exclusively for a single firm, on their schedule, can start to look like employment rather than self-employment. GOV.UK's employment status guidance is where to check.

How do you make a direct book compound?

By never losing a renewal date. Engineers stay on sub work longer than they meant to not because direct customers are hard to win, but because they leak: the service you did two winters ago never got chased, and the book stayed the same size while the effort went in. That is a record-keeping problem before a marketing one. Manifold keeps every job against the property, sets the next due date as you finish and chases the renewal automatically.