There can be any number of reasons that a company needs access to fast cash. This is true for companies of all sizes, from single-owner to multi-national companies. But, with traditional credit avenues tightening, some companies can find it difficult to get the money they need quickly. This is especially true for businesses that provide services and products to companies in the oilfields whose customers traditionally take an extended time in paying due to the nature of the extraction to market process. Factoring invoices can play a major role in solving the financial issues for those providing the services and waiting on their accounts receivables.
An abundant amount of service providers in the oil field industry that have taken advantage of Universal Funding’s expertise in A/R financing including:
- Water Haulers
- Vacuum Trucks and Operators
- Site Preparation Service Providers
- Equipment Rentals
- Wireline Service Providers
- Valve Manufacturers
- Staffing Companies
- Crude Haulers
Factoring invoices is one of the quickest and simplest ways for these businesses to get money without using a line of credit or incurring debt. In essence, factoring invoices is when a company sells some (or all) of its accounts receivable to a factoring company. The factoring company pays the business a lump sum of money that is agreed upon before the transaction. This lump sum of money normally represents a substantial percentage of the total amount of the accounts receivable that were used for the transaction. Many times, a company can get as much as 80% to 90% of the value of the accounts receivable. Once the invoice is paid in full from their customer(s) a refund is issued for the remainder balance minus a small factoring fee.
If you are a service provider in the oilfield industry and can’t afford to wait for oil to be extracted and refined before you receive payment for the services you provided, give us a call. At Universal Funding, we understand the issues facing companies in your industry and are here to help. Call 1-800-856-7014 or fill out a rate form to speak with one of our Business Development Associates.