Many industries require significant cash outlay to conduct consistent and successful business transactions, and the oil and gas services industry is no exception. A business must invest in labor and materials in advance of realizing profits, which means a potentially expensive endeavor. It might be anywhere from one to three months before payments will arrive from customers. This is where oilfield factoring services can help.
Growing businesses, large and small, struggle with cash-flow; but traditional bank lending is more difficult to obtain for small businesses – and nearly impossible for start-ups. A factoring lender like Security Business Capital gives small businesses and medium enterprises the financial strength they need to compete in the oil field industry.
The Benefits of Using Oil and Gas Factoring
The energy industry lends itself particularly well to working with an oil and gas factoring company since the funds make it easy for a company to accomplish any or all of the following without going into long-term or semi-permanent debt.
- Hire transport for materials and resources that need to reach rig sites.
- Engage in research and development for future projects and future profits.
- Keep payroll funded so employees remain loyal and productive.
- Create and implement training and safety programs
- Expand workforce with new, skilled personnel
- Replace or upgrade equipment to keep the business competitive
You may consider accounts receivable financing as a type of short-term borrowing where an oil field service business can operate as if it had a vast amount of cash on hand. Your outstanding invoices are purchased by the invoice factoring company allowing you to operate with cash.
In many cases, a company working in the oil and gas industry wouldn't qualify for traditional funding. Difficulty in obtaining capital funding could halt or slow the progression of a new company's ability to build clientele, bid on projects, or expand.
Accounts Receivable Financing is Not a Loan
At the start of a business's lifetime, it's often necessary to go into debt and borrow money to set up operations. Likewise, when a business seeks to expand, it may become necessary to seek out assistance from traditional banks for mortgages, loans, and other financial assistance.
Working with an accounts receivable financing company like Security Business Capital isn't like walking into a bank for a traditional loan. The process requires no monthly payments, and the business can remain debt-free. If your oil field industry business generates sales through open credit terms, working with a factoring services company may offer your business the most efficient and cost-effective way to obtain cash on hand.
Invoice Factoring with Security Business Capital
Are you interested in a fast and flexible option for funding your oil field industry business? Do you want to avoid the complexities of traditional lending and limit your company's debt? Are you an entrepreneur working in oil and gas who needs a creative option because the standards in gas and oil lending have tightened?
We provide services to many different types of companies in the oil and gas industry including:
- Gravel pit suppliers
- Inspection services
- Mud haulers
- Rig movers
- Roustabout companies
- Vacuum truckers
Working with accounts receivable financing lender like Security Business Capital can help you fund exploration services, flow-back testing, environmental cleanup, and a host of other common projects. For the most affordable Texas-based oil & gas factoring rates without the hidden fees, contact Security Business Capital today.