In the oil and gas industry, you are constantly waiting for invoices to be processed and paid. In some cases, you can wait up to 30, 60, or even 90 days to receive payments on jobs.
Even though it’s easy to blame your clients for their late payments, it may be because your invoicing isn’t as efficient as it should be.
Improving Your Invoicing Process With Oil & Gas Factoring
The way you write, create, and deliver invoices completely affects the way your customers make payments. There are many ways that you can improve your invoices to ensure that you are getting the fastest payment possible for your clients, including utilizing invoice factoring.
Make Payment Terms Very Clear
In the oil and gas business, no jobs, orders, or clients are the same. It is important that you don’t assume that every client expects the same payment terms.
For faster payment, be sure to negotiate payment terms for shorter periods of time in person. This will ensure that you will get paid faster and that they understand exactly what is expected of them in the payment process.
Stating an actual due date, rather than using a number of days that the payment is due will result in more effective payments as well.
Spell Out All Payment Details
By keeping payment details hidden or in confusing language will only make it more complicated for you to get paid. Make the payment details very easy to understand, so your clients have no reason to not pay on time.
It is important to list the following details on your oil and gas invoices:
- Details of job that was completed
- Amount of oil, gas, or other fuel that was provided
- Due date listed clearly
- All available payment options listed
To make your invoice even easier to comprehend by your clients, ask them what information they need. This will allow them to have everything they need to make the payment fast, and on time, and show that you care about their needs.
Take Deposits for Large Invoices
Have a long term contract or special order? Don’t take any chances with their payments. Negotiate an upfront payment deposit. This way, the client will be held accountable for their payment in the future and you will have a sum of the project revenue in your pocket in the case of emergencies.
Send Oil & Gas Invoices Early
The faster you invoice your customer, the earlier they will need to pay. Have the invoices sent and prepared before the job is completed. Having the invoice practically complete before the job is completed will allow for a faster sending process.
This will ensure that the payment terms can start at the earliest possible date. It will also keep your business accountable for every invoice. The chances of having an invoice overlooked or missed will lessen greatly.
Take Advantage of Oil & Gas Invoice Factoring
If you are waiting up to 30, 60, or even 90 days to get paid for your outstanding invoices, it’s time to take advantage of oil and gas factoring.
With oil and gas factoring, you’ll be able to get paid for your outstanding invoices in just 24 hours or less. A factoring company will step in and purchase your invoices to advance you up to 96% of its total in just 24 hours or less.
This will allow you to build a strong source of capital for your business so that you can catch up with payments, pay off debts, purchase new equipment, take on more clients, and much more.