3 Tips for Mining Companies Looking to Generate Cash Flow
With commodity prices squeezing cash flow, mining companies everywhere are seeking ways to control costs. Doing so depends in large part on getting material out of the ground as efficiently and cost-effectively as possible. Our own experts explain how financial solutions can play a role in making that a reality. Here are three opportunities they shared to preserve your operation’s cash.
1. Weigh rebuild versus replace.
The newer the equipment, the more efficient the operation—but when purchasing new machines isn’t realistic, rebuilding equipment may be your best option to extend life and improve equipment availability at a lower cost. (Another option: consider used equipment.) Captive finance companies can provide special financing packages for rebuild options.
2. Turn to technology.
Another way to bring efficiency into your operation is through technology. Today’s mining technologies deliver insights that identify where things are going well and where there’s need for improvement. Health monitoring systems can ensure that maintenance stays on track and can spot problems before they turn into expensive repairs—meanwhile, onboard guidance tools can help operators hit targets every time, reducing costly rework, fuel use and excessive wear.
Spending money to acquire technology in a down market may seem counter-intuitive, but it can pay for itself relatively quickly—and financial assistance is available. We can bundle financing for equipment and technology purchased together, as well as work with customers who buy technology separately.
3. Work with your lender.
If options like those described above don’t do enough to improve cash flow, it’s worth reaching out to your lenders to explore other solutions. Captive finance companies, in particular, are prepared to work with customers to align debt service with an operation’s cash flow.
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