Your Business Credit Score

Your business credit score is one of the most important things that your business has. Your business credit score is going to affect many different aspects of your business as a whole. Here are a few things to consider about your business credit score and the importance of establishing a good one.

Business Credit Score

The basic idea behind a business credit score is the same as a personal credit score. A credit bureau will monitor the actions of the business and then utilize a formula in order to come up with a credit score for them. In the business world, Dun & Bradstreet is the main credit bureau. They will look at how the business handles their transactions and give it a cumulative score based on that. 

Importance of Credit Score

Your business credit score is extremely important to your success. Many different companies and creditors are going to look at your credit score before they make important decisions regarding your business. For example, if you try to secure some type of financing, the lender is going to look at your business credit score in order to determine if they should lend you money. Your insurance company is going to look at your credit score in order to determine what your premiums are going to be. Even your landlord can look at your business credit score in order to determine how big of a deposit to charge you and how much your rent should be. Therefore, having a high credit score is going to save you quite a bit of money for your business.

How to Establish

If you do nothing special, through the normal course of business, your business is most likely going to have a credit file developed for it by the credit bureaus. However, if you want to speed things up, you can contact the credit bureaus and set up a file with them directly. You will simply have to provide them with basic information about your business and yourself in order to get a file started. 

Getting a Good Score

Once you have a credit file established, you will need to work on getting a good credit score. There are a number of different things that you can do in order to facilitate a good score. One of the most important things that you can do is to always pay your bills on time. One of the most important factors that is used to calculate a business credit score is the number of late payments on their record. If the business does not have any late payments, they are most likely going to have a good credit score. You should always strive to keep a good relationship with your creditors.

You should also strive to keep your credit lines below their limits. If a business is continually maxed out on their credit, they are going to have a difficult time keeping a good credit score. 



View all 3 of your FREE Credit Scores

blog comments powered by Disqus