• Big oil and small businesses have always had a symbiotic relationship, where one relies on the other for success.
• Small businesses provided significant oil companies with drilling rigs, transportation, and other services needed to extract and refine crude oil in the early days of the industry.
• Today, small businesses continue to offer maintenance and testing services and often participate in supplier diversity programs.
• Some big oil companies also offer joint ventures, strategic alliances, loans, and grants to small businesses.
• Overall, this relationship between big oil and small businesses is essential for a thriving economy in the U.S.
In the United States, big oil and small businesses have always had a symbiotic relationship. The two industries are inextricably linked, each relying on the other for success. Here’s a look at how big oil and small businesses have worked together throughout history to help the U.S. economy prosper.
The Early Days of Big Oil and Small Businesses
In the early days of the oil industry, small businesses were vital to the success of big oil companies. Major oil companies such as Standard Oil and Gulf Oil depended on small businesses to provide the drilling rigs, transportation, and other services needed to extract and refine crude oil. Without the support of small businesses, big oil would not have been able to get off the ground.
As the oil industry grew, so did the need for small businesses to support it. By 1920, there were over 40,000 miles of pipelines crisscrossing the country, transporting oil from wells to refineries. Small businesses built and maintained these pipelines, ensuring that oil flowed smoothly from the well to the refinery.
In addition, small businesses provided many of the services needed by early oil companies, such as drilling rigs and transportation. Without these small businesses, big oil would not have been able to get off the ground.
As the industry grew, so did the demand for these services. Before the 2000s, there were over 200,000 miles of pipelines crisscrossing the country. This then created a need for even more small businesses to maintain and repair the pipelines.
Big Oil Today: Supporting Small Businesses Across America
Nowadays, small businesses are part of this billion-dollar industry. Here’s how they live in a symbiotic relationship today:
Maintenance and Testing
The oil industry demands constant maintenance and testing of rigs and pipelines to keep them running at peak efficiency. Safety is crucial for these huge businesses, and small businesses are here to do some of the crucial jobs in the field.
One of the essential valve maintenance. Valves are responsible for delivering oil and gas safely, which is why it’s vital that they are regularly tested and maintained. Valve testing services do this for big businesses in the industry. They look into the faults and malfunctions that could lead to big problems if not addressed in time.
Supplier Diversity Programs
Many big oil companies have supplier diversity programs in place to help support small, minority-owned businesses. These programs typically involve setting aside a certain percentage of contracts for small businesses that meet certain criteria, such as being owned by women or minorities. Sometimes, big oil companies also offer mentorship programs and other resources to help small businesses grow and succeed.
Joint Ventures and Strategic Alliances
Joint ventures and strategic alliances are another way big oil companies work with small businesses in the U.S. Under a joint venture, two or more companies come together to share the risks and rewards of a project or venture.
Strategic alliances are similar, but they typically involve less financial risk-sharing than joint ventures. For example, a big oil company might form a strategic alliance with a small transportation company to help transport its products more efficiently.
Small Business Loans and Grants
Some big oil companies also offer loans and grants to small businesses through their corporate foundations or other philanthropic initiatives. These programs typically have strict eligibility requirements, but they can be a valuable source of funding for small businesses that meet the criteria.
Local Hiring Initiatives
Finally, many big oil companies have local hiring initiatives to support small businesses in the communities where they operate. These initiatives typically involve setting aside a certain percentage of jobs for local residents, including small business owners and employees. Sometimes, big oil companies also offer training and development programs to help local residents prepare for these jobs.
Overall, big oil and small businesses have always had a symbiotic relationship. It is this partnership that has helped the U.S. economy grow and thrive in the past, and it continues to be an essential factor in the success of both industries today. By working together, big oil and small businesses can help ensure a thriving economy for generations.