Wholesale Cost

A contract where a subcontractor processes or treats a client's raw material using your equipment or facility, without taking ownership of it. You charge a fee for the service rather than buying and reselling the material. Common in midstream and processing work, it directly affects how you invoice and recognise revenue.

A contract clause requiring the client to pay for a minimum volume of services or materials, whether used or not. For subcontractors, it provides revenue protection when a project slows down or scopes are cut. Negotiate these clauses carefully to ensure your standby rates and mobilisation costs are covered.

When an operator returns a field ticket for correction before approval. Common causes include missing information, rate discrepancies, or insufficient documentation. Rejections delay payment and require rework.

Funds raised or borrowed to grow a subcontracting business beyond its current capacity. This covers new equipment, additional crews, or entry into new service markets. It differs from operating capital, which keeps day-to-day work running.

Payment tied to a specific condition being met, such as project completion or client approval. Subcontractors must track these triggers carefully to invoice on time. Delayed conditions can create serious cash-flow gaps in the field.

Pricing arrangements where labour or service rates are automatically adjusted based on preset variables like fuel costs or inflation indices. Common in long-term oil and gas contracts, they reduce rate renegotiation between operators and subcontractors.

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