A Structured Selection Process for Small and Medium Enterprises in Construction Industry: Case of International Projects

Abstract

Construction industry in most countries relies heavily on small and medium enterprises (i.e., subcontractors). Therefore, in today’s highly competitive construction business, it is inevitable to select suitable subcontractors which physically execute almost all of production activities in construction projects. In this context, through a proper selection process, their competences should be guaranteed as much as possible. In fact, this becomes a more significant issue if the project undertaken is performed abroad. In this regard, it should be noted that Turkish construction companies have been significantly active in the international arena for decades. Based on these arguments, subcontractor characteristics to be considered in international projects should be revealed clearly. Accordingly, this paper proposes a structured process for subcontractor selection in international construction projects. Toward this aim, a questionnaire survey was applied to 96 construction companies, all of which are members of Turkish Contractors Association, and the corresponding numerical results were evaluated via descriptive statistics and 95% confidence interval. Thus, a three-step selection procedure together with their specific criteria was suggested from the conceptual point of view. These steps include (i) shortlisting with ten criteria, (ii) negotiation with seven criteria, and lastly (iii) final selection with seven criteria. Hence, this study can provoke potential researchers to find similarities or differences of such criteria between their countries and Turkey. Also, it can help both main contractors to execute the whole construction process in a financially sustainable environment and subcontractors to increase business opportunities in the international market.