If you have a business involved the oil and gas industry sector, you’re probably aware that this industry has been thriving for some time (even throughout the recent recession years). This trend appears likely to continue long into the future even with the recent oil price volatility. Over the course of the last several decades, the industry has grown at a steady to exponential rate. This has attracted a lot of companies to set up businesses serving the large oil companies and means there is promise to enjoy success and security for many years to come. Companies are eager to explore new sites, and advancing technology and political advocates are facilitating this growth.
Various shifts in the global economy have led to a somewhat volatile market and economically conservative approach on the part of the large oil and gas companies. Many of these clients prefer longer terms, and they may wish to make payments later than they might have in the past. Companies still get paid after they invoice clients, but such payments may not come quickly enough to meet the financial needs of those companies who work with the large oil companies.
Overcoming the Trend of Delayed Payments
Since companies are ultimately paid by their clients, they can safely continue their work in the field. Unfortunately, delayed payments can create problems for companies when they need cash flowing in to pay for such industry necessities as equipment, workers, and start-up endeavors. Funding exploration projects and research and development programs is also essential. The solution to a cash flow problem for such a company is as simple as obtaining a loan.
Applying for traditional financing via a banking institution is not always a feasible strategy for companies who serve the oil and gas industry. This is why invoice factoring is a practicable alternative for such businesses. Invoice factoring enables a business to access cash immediately instead of waiting a month or two for invoices to be paid. From the smallest company supplying lunches to the oil field work crews to the companies that supply the labor to check on the oil well, factoring can be a great alternative funding solution.
How Invoice Factoring Works
The factoring process works more quickly and easily than most traditional methods. A business submits invoices to an invoice company like Eagle Business Credit. The factoring company pays that business cash for about 80% to 90% of the total value of the submitted invoices. Once an invoice has been paid, then the factoring company pays the remaining balance to the business.
Invoice factoring is a streamlined loan process that benefits everyone involved. If you run a business which is involved in the oil and gas industry sector, you might consider contacting a reputable invoice factoring company such as Eagle Business Credit. You’ll get the cash you need immediately, so you can keep your business running as smoothly as it should.