The construction industry is made up of contractors, subcontractors, general contractors, and other positions that all need to work with one another. But, because each new project carries a specific set of requirements in terms of certifications, insurance, minority owned business status, etc., selection of the subcontractors tends to be a full of friction and stress for all sides.
A subcontractor has to scramble and submit paperwork for a range of documentation; often slightly different from bid to bid. A general contractor must spend time validating the subcontractor’s paperwork before reviewing the merits of their actual bid, and deciding who may be selected for the project. Licenses. Insurance. Minority status. Training & certifications. Government contractor status, etc. Today, validating all the documents takes up more time and money than it needs to.
The system needs a streamlined solution to this wasted time. This is where BuilderChain comes in. With BuilderChain, companies can take advantage of blockchain technology to quickly and efficiently confirm and verify information.
BuilderChain offers a process called ‘tokenized validation’ which takes place on BuilderChain’s Construction Network. To take part in the network, contractors, lenders, and other parties must sign up and provide their paperwork, licenses, and additional relevant information. This data may contain anything from insurance policies, minority-owned businesses, or dollar limits, among other forms. Upon validation, the party will receive a multi-use “validation token” as a proof of ownership.
NOTE: “Multi-use” means that the subcontractor does not need to provide the paperwork with each new bid. It is taken care of, by using technology.
Blockchain networks offer complete transparency alongside a detailed, immutable history. This means that project owners and general contractors can view the entire past of all subcontractors and vice versa. And because robust cryptography is part of blockchain technology, there is no way to falsify validation data on the system.
In addition to validation, the Construction Network will keep track of expiration dates. The system will notify the token holder in advance of any upcoming key dates. Should insurance or a license expire, the party will not be able to take part in the network until they refresh their information.
In a traditional marketplace, the roofer would have to submit documents for each specific job. Fifteen opportunities? That would require 15 slightly different sets of paperwork. What a pain! The owner of that job would then have to review the files of every applicant. Also a pain!
Key problems include: lost time for project start, as reviewing paper based documents is slow; fraud, as nominees can alter data points in their documents; unneeded effort, as the nominees are required to submit paperwork over and over, for every bid.
On the BuilderChain network, only subcontractors viewed as eligible by the smart contract may submit a proposal. The benefits are apparent to all parties. Sub-contractors do not need to submit any certification paperwork — it is all part of their tokenized profile. So, they are pre-validated. This is a blessing for general contractors as they only focus on the responses from the sub-contractors, not the data regarding certifications, training, etc. Selection by the general contractor of sub-contractors is more rapid, allowing the work to begin as soon as possible.
Once a party is validated, they can then participate in projects on the Construction Network.
The US college application process was revolutionized by the “Common App” (maybe not for the better). With just a few clicks a student could apply to more than one university without filling out all the basic info yet again.
Thanks to the ‘validate once, use many times’ ideology behind BuilderChain, builders and subcontractors will enjoy a similar system. In particular, smaller subcontractors with less staff will benefit from being able to bid on more work than ever before. This is going to contribute to an increase in variety, ensuring that contract workers can participate in projects where they excel most.
The current state of the construction industry isn’t nearly as ideal or efficient as it could be. Right now, it takes time for jobs to start, with tons of documents required for all sorts of validation before work can commence. Workers lean towards faster-paying jobs instead of positions that excite them. The BuilderChain tokenomics look to speed up the process, while enabling greater transparency with the same amount of detailed information. With BuilderChain, the construction industry will see more jobs completed than ever before.