Oilfield Invoice Factoring

Benefits of Oilfield Invoice Factoring


 

It is very common in business to offer clients pay terms of 30, 60 or even 90 days, which can create some cash flow problems, especially for companies that are just starting out or that have inconsistent access to capital. Oilfield excavation businesses fall into this category, as they often go from having tons of cash on hand to having none at all. Since the industry is very inconsistent, it might cause some to look for quick and easy financing to help them get over the hump. One option is to choose oilfield invoice factoring, which allows businesses to get the money they need fast. Here are some of the biggest advantages of oilfield invoice factoring.

How does Oilfield Invoice Factoring Work?

Oilfield invoice factoring is very simple. It basically allows you to use your accounts receivables to get the money you need. You will essentially sell your outstanding invoices to a factoring company that will pay you up to the amount of this invoice minus their fee. They will then take on the task of recovering the bill, which allows the oil excavating company to go about their business without worrying about the hassle of collecting outstanding invoices.


 

The Benefits of Using Oilfield Invoice Factoring

There are a number of benefits to using this service, especially when compared with using traditional lenders like banks. Here are some of the biggest advantages:

 

-It will give your company positive cash flow

Running an oil excavating business takes money and lots of it. This is why some companies cannot wait around for ninety days to get paid. Using oilfield invoice factoring allows you to get the positive cash flow you require to keep your operations running. If you cannot meet your financial obligations to your employees or suppliers then the business will not be able to continue on, which is why factoring is such a good option.

Oilfield Invoice Factoring

-You get invoices paid fast

Instead of waiting around for customers to pay, factoring allows your business to get paid right way. This will permit you to pay your suppliers in advance or early, which might even earn some discounts. It also allows you to continue to pursue new business opportunities without worrying where the money is going to come from. You shouldn’t have to put your business on hold just because your customers do not pay right away.

 

-Stress Relief and Peace of Mind

Nothing is more stressful for a business owner than worrying about how he or she is going to meet financial obligations. If you find yourself constantly stressing over money or are concerned about paying your employees, your bills or other expenses then factoring can help. It allows you to get on with your business while someone else worries about the money.

-It’s faster and easier than a bank

Bank loans can take weeks to get approved and also require a high level of credit and assets. You might not have the time to wait around for a bank to approve your loan, nor the necessary credit rating to even get one. The great part about factoring is that you can get it even if you credit rating is less than perfect. Factoring allows you to get the money you need without the hassle and potential liability of going through a traditional lender like a bank.

 

Don’t wait to get the money you need

If you have short-term cash flow issues then you should not hesitate to look into oilfield invoice factoring. You can get the capital you need to keep your operations going without assuming a lot of extra debt or risk.