Handy Tips For Starting Oil Field Service Company

By Maryanne Goff

You can start a business in the oil industry without necessarily having to produce petroleum itself. You can indulge in the oil field service company and actually offer service to petroleum exploration and production industry only. You will still get the satisfaction you need from the industry. In fact, it is a great opportunity for entrepreneurs. All you need is some little technical knowhow in the industry and you will be set for provision of cost effective services. Technology is constantly advancing and the oil industry is benefiting. You can take advantage of this advancement and provide new drilling techniques as well as emerging oil and gas discoveries as services.

A profitable business begins with a solid business plan, but it will also require an initial capital outlay. Contacts within the industry are useful as well. Another important consideration is a relevant business attorney. A good attorney will help you to start your business legally, help with the business' EIN registrations and draw up contracts so that the necessary legal protections are in place.

Take time to get information from other competitors. By this, you will have a look at how they operate, their annual report, pricing and other pertinent details. Do website comparisons, so you may have an idea on what your website is to look like.

The business plan is very important as it is like a map for success. It should include the details of your products and services, and should explain the business thoroughly. Software is available to help you that will also incorporate finances. It is recommended to make two pages of details, as well as about a twenty-slide power point presentation. This presentation, along with the summary, can then be shown to potential investors.

You need to project your financials well so that you will know when you are likely to recover your investment. A 3 to 5 year revenue projection is good enough. Just ensure that you include the balance sheet, income statement, profit and loss statement, statement of cash flows, annual expenses, taxes, cost of goods sold, working capital and use of funds.

DO a list of your contacts. Be resourceful in obtaining their approval as investors. You can develop a system for your contacts. Make commitment letters and/or provide a copy of previous contract for the investors to see that your business is viable.

When obtaining capital for your business, consider various options, such as angel investors, private equity or hedge funds, and venture capital. You will have more success with investors that are already involved, or interested, in the industry, and you can show them your presentations to gain their respect. The investments acquired can be organized as debt, equity, or both, and decide upon the amount of funding needed.

While it is obvious that you may have the right capital, you have to look out for an insurance company to cover any unforeseen event in the future. This is not limited to your company alone but for your employees as well. An oil field service company is said to be open to great opportunities together with great risks. That is why it is not recommended to put up a company like this on your own. A corporation is the best entity to represent the business.

About the Author:

You can visit the website totalthrutubing.com for more helpful information about Things To Consider Before Opening An Oil Field Service Company