Many companies learn the hard way when it comes to business credit scores and indexes (Dun & Bradstreet, Experian, Equifax, & more)– they don’t pay attention to credit until it stands in the way of opportunities, some don’t even know they are losing partnerships and new business due to poor or less-than-competitive credit scores/indexes.
On the other hand, business owners/managers who do consider their business credit scores may hit a wall when it comes to building them. Many vendors do not report payment information at all to the business credit bureaus – you could be using a great vendor for 10 years and have no idea that they have never reported your payment history. To find vendors who do report you must go through the timely process of researching the vendor’s procedure toward reporting payment data.
To help open the door for you, below are 5 starter vendors who will report your payment information.
Before we go there, make sure to follow all the steps to business credit building and establishing. There is more to having strong business credit than paying on time.
- Incorporate your business: To build credit your business much be a legal entity.
- Set up your EIN and DUNs numbers.
- Open business bank accounts.
- Establish a location and toll-free number for your business.
- Start a website and develop your online presence.
- Have a business email address rather than a generic free email.
Vendors and creditors often prefer doing business with companies that have a physical address – PO Boxes can increase the risk of fraud. They also like to see that a business has online exposure.
It’s also important to understand that when you start building business credit your credit history will be very young, and it is crucial that you pay all the accounts at or before terms. You want to make sure that you’re building strong credit scores and if you fall delinquent on these immature accounts they will have a significant negative impact.
- Staples – An office supplies retailer, they provide multiple types of business accounts that are catered to the size, capacity, and region of the business. Wells Fargo underwrites and finances every line of credit for Staples – if you have business credit they will look at Dun & Bradstreet and check basic information like the company’s online presence, tax information, and location. For smaller companies with limited credit history, Staples will usually offer a $1000 Net 30 line of credit for starters. They report back to Dun & Bradstreet.
- Uline – A distributor of industrial goods and packaging supplies, you can establish Net-30 payment terms with Uline by filling out their Credit Application, it will ask for your DUNs number and business bank account information. They will check credit (if you have any) from Dun & Bradstreet. If they find that your credit history is too limited to determine the line amount – they may ask you to prepay for the first order or have their credit department work with you to get approved. They report back to Dun & Bradstreet.
- Quill – a retail supplier of office supplies, they pull credit information from Dun & Bradstreet. If your business has no or limited credit, they will request that you pre-pay for 90-days before establishing payment terms. After those 90-days they will review your credit again and set up Net 30 terms with a credit line based on your expenditure over those preliminary 90 days. They also offer an “Installment Payment Program” that allows you to pay your invoice in 6 payments with 0% interest. They report back to Dun & Bradstreet.
- Grainger – An industrial goods supplier, they sell products including but not limited to – paint, safety equipment, lighting, and plumbing. They offer an open line of credit to customers and report payment information automatically to one of the largest business credit bureaus. For new companies with limited credit history they will often offer a $1000 line of credit to start, then increase it upon request and with a demonstrated history of good payment habits. They report back to Dun & Bradstreet.
- Strategic Network Solutions – An information technology service company, they report credit information to two of the major credit bureaus and are another great vendor to start building credit with. They provide an online credit application for businesses (linked below) – create a username and provide company information including the legal structure of the business, the companies tax identification number (EIN), DUNs number, annual revenue, and number of employees. It will then ask personal information on the officer of the company.They report back to Dun & Bradstreet & Equifax.
Keep your personal credit safe
There are many advantages to having business credit, one being that you can eventually avoid using your personal credit to guarantee loans. Keeping your personal credit separate means you can limit personal liability on business expenses – which should be of great concern to business owners. Business credit building will benefit you both professionally and as a consumer by separating transactions and accounts.
The world of business credit reporting has a separate landscape from personal credit; it’s best to speak with a professional about your business credit. If you’ve been an active company for 10 years and have never paid attention or noticed your business credit we can help you find out whether you have scores and guide you on the best way to proceed. If you just started your company and are looking to be proactive we can also provide you with resources and services that can help to steer the new business by making you more attractive to partners, new accounts, lenders, vendors, and creditors.