Subcontracting is the most prevailing means employed by a general contractor to execute a project. For a general contractor, maintaining a proper relationship with his subcontractors, especially the core supply base, is one of the crucial strategic decisions in business administration. This study examines 22 major general contractors (all listed top 100) to unveil the associated strategic implications. The contractors arc survey and interviews for gaining insights relevant to the study. In terms of quantitative analysis, it is found that a contractor’s performance is significantly correlated with the characteristics of his core supply base. In terms of qualitative analysis, by a case study, it is concluded that the core supply base is pivotal in improving the competitive advantage in most value-added activities in a construction project. The finding of the study also suggests that a general contractor should regard his the subcontrators more as critical construction resource for the success of a project, rather than simply cost items for running the business.