Contd… from previous article
6. Credit: the first step to establish your business credit comes to the fore here. If all the above steps are complete, you can register your business with vendors like staples.com by faxing your business phone bill and credit application printed and filled-out on your business letter-head to obtain a credit-line of $750 without offering any personal guarantees. This is just the beginning and the credit is extended to take care of your initial expenses.
7. Business credit tracking: The best way to get your business on the bandwagon of business credit tracking is to establish a good profile with Dun and Bradstreet (DNB) and obtain the all important DUNS number. DNB is a very large organization and is one the biggest trackers of business credit. The DUNS number thus obtained is unique and contains 9 digits which is given for free. The process takes up to 30 days and if you are in a hurry, you can obtain your DUNS number faster by subscribing to the DNB credit-builder services. Companies that want to deal with you and use DNB will ask for your file and the process of establishing credit in such a scenario could take up to six weeks. Make sure that all information provided to DNB is correct since all that you say about your business will go to your credit file permanently.
8. Credit Scores: You are now ready to apply for business credit once you have received your DUNS number. However, make sure that you always pay your invoices before the grace period expires otherwise your credit score (Paydex score) can take a beating. According to the business credit ratings, a Paydex score of above 80 is considered very good if you have a payment history with a minimum of five vendors. Unlike the personal credit ratings, the business credit score goes up with every day you pay earlier than the due date. The Paydex score opens up new vistas for your business by providing opportunities with best vendors and lending institutions.
9. Extending business credit: There are a lot of companies that can extend business credit without a personal guarantee. There is a comprehensive list of companies that do so and it is quite easy to find online. One piece of advice here is that you should not apply to all companies together. It is always advised to keep of gap at least 15 days between two applications so that your credit file is not flagged. Go ahead and apply to these companies one after another.
While launching a business is not such a big factor, running one with good business credit is. Keeping track of your accounts receivables and payables and being one above them is essential to build a good business credit. The better your business credit is, the faster you can build your business and achieve your ambitions.
We have many more Credit Repair Articles Now Available.