Although the American economy continues to recover slowly, the downturn of 2008 is still having an impact on many industries. The oil and gas industries are perhaps two of the hardest hit, and many employers are eager to learn how to save money and jobs in their land management companies. Fortunately, several ways exist to do both, and most are fairly easy to implement.
Stay Familiar with the Oil Market
As an oil and gas broker, you need to be aware of any changes in the market all the time. For example, oil prices are lower than ever due to a worldwide supply glut. This is due to OPEC’s decision to let supply and demand for oil and gasoline balance naturally. While the decision has led to lower gas prices for consumers and thus a slightly lower cost of living, it has negatively impacted oil brokers and will continue doing so. One such impact is the closing of oil and gas companies. Rather than large corporations, the oil and gas industry currently relies on small and mid-size organizations, which decreases the number of available positions for workers, especially for recent graduates.
If you are an oil or gas broker who needs to keep jobs in your company, consider revamping your operational footprint. Do not rush to downsize your most skilled staff; you will need them for high-end projects, consulting, and other complicated tasks for which new workers may not be ready. Instead, make small changes that allow you to keep advantageous projects on the table. You may want to downsize less-skilled staff members, especially those who were hired most recently and have better chances of finding work in similar companies. You can also scale back on daily operations so your workers are spending less time on routine tasks and more time on tasks that will help your company stand out in the oil and gas industries.
Deal with Debt
Debt is one of the oil and gas industry’s most significant challenges. Therefore, it’s crucial to stay abreast of your outstanding balance, especially if your company already has a poor credit rating. Oil revenue has continued declining in recent years – oil drillers were $235 billion in debt during the first quarter of 2015 alone. As with any other industry, this amount of debt trickles down, impacting oil and gas brokers and their employees.
In order to save yourself the pain of debt, you must consider how several different factors impact your business. These factors include hedging strategies, cost-cutting measures, number of employees and the type work they perform, and what projects you are willing to table. If you do not have a trusted financial adviser, now is the time to find one and consult with him or her regularly. Preserve as much money as possible, and implement cost-cutting measures such as spending limits and hiring freezes where necessary.
Balance Short-Term Projects with Long-Term Success
In any business, it makes sense to keep several long-term projects on the table. Most business professionals, including oil and gas brokers, see large long-term projects as the easiest way to make money and keep employees focused and interested in their jobs. Currently though, short-term projects are the best way to go if you need to cut costs and save jobs. Think about how you can bundle or integrate tasks; streamlining will save money and ensure your employees have a variety of tasks to work on each day.
Additionally, collaborate with other oil companies, both foreign and domestic. Relationships can be tense in this industry, but you can find partnerships that help ensure your employees will keep their jobs and your company will stay out of debt for years to come. Collaboration will naturally reduce the amount of oil and gas you need, saving money and the time it takes to ship and produce these products.
When you collaborate, be aware of the other companies’ strengths and how they streamline projects and daily tasks. They may use business models you are unfamiliar with, giving you the opportunity to improve your own processes. For example, you company may do poorly in offloading and storage, but your collaborators may be professionals in this area. Ask for help early and often.
