The business credit industry is highly unregulated; this means that anyone, including potential partners, lenders and competitors, can purchase a copy of your business credit profile at any time without your knowledge.
Establishing business credit that has been operating for years does not necessarily mean you will automatically have a business credit profile. Our business credit building service works for both startups and companies that have been active for 20 plus years.
What many business owners do not realize is that not all vendors, lenders, and creditor’s report to the business credit bureaus. Without a strategic plan, your firm might appear as though it has no history of accounts or payments, which can make your business look inactive and a high risk to lenders, partners, and potential accounts. In many cases, business owners use their personal credit to run the daily operations of their business. This can lead to personal loan declines and the destruction of personal credit scores.
1: Incorporate – By incorporating you will be legally separating yourself from your business. The first step to building business credit profiles is to have your business established as it’s own legal entity. (you also have other options like changing to an S Corp, C Corp, or Limited Liability.)
2: Employer ID Number (EIN) – This is the identification number for your buiness, kind of like a company’s SSN, you will need this in order to pay employees, taxes, and for credit reporting.
3: Set up your DUNs – Dun & Bradstreet is the largest business credit reporting agency, you will need to create your DUNs number in order to have a profile through them. The other 2 major bureaus are Experian & Equifax – they operate differently and you cannot create your ID number through them, in order to have a profile through those two you will need to have vendors reporting to them.
4: Separate accounts – banking (checking & savings) accounts for your business should be kept separate from your personal accounts/finances.
5: Start establishing lines of credit – you could start with a small business account through Staples or a supply store, just make sure that they report to the business bureau(s). Some business owners with good personal credit, will leverage their great credit to get a high limit business credit card or line of credit that reports to the business credit bureaus.
When building up vendor accounts and lines of credit for your business, always ask if they report to any of the business credit bureaus. If they do not, you might consider either asking them to or looking for a different vendor to work with.
6: Pay on time – This might be a obvious, but even an invoice paid a few days beyond terms can be damaging to an immature business credit profile. Don’t damage all the work you have done to build your business credit by paying late or not at all.
Once you have begun the process of building business credit it is important that you are diligent about paying your bills by or before their due date. This will likely help your business fall into a lower risk index. However, it is important to keep in mind that due to the unregulated nature of business credit, it is possible for incorrect, negative information or public filings to end up on your report(s) by mistake. For this reason, we recommend taking on the job of monitoring each profile on a consistent basis. Every major credit profile (Experian, Equifax, & Dun & Bradstreet) should be reviewed to make sure that the information provided is correct, relevant, and up-to-date.
XYZ is a real estate investment company, for the last decade they have successfully purchased, renovated, and sold properties for a profit. Their growing business depends on an overflow of cash that can only be obtained through relationships with wealthy investors. Then suddenly investors began pulling out and XYZ’s business seemed to be on the brink of disaster – with over a decade of success why the sudden change? After the market crash of 2008 investors became much more risk savvy and began carefully reviewing business credit reports before approving investments. It seems that XYZ had hired a bookkeeper who, unbeknownst to them, was not keeping up with paying suppliers on time.
Sourced from Experian’s 2016 Q3 Main Street Report
XYZ’s scores and indexes had dropped significantly in a matter of months. But, they had no knowledge of it because they were not reviewing reports and did not understand the nature of business credit and the consequences of what it reflects. Not realizing anyone can review their business credit without their knowledge or approval and make decisions about them based on the info updated XYZ was in a very vulnerable position.
After doing some research XYZ found NSA, we knew the time sensitive nature of this issue and dug right into each report. Our business expert credit specialists were able to remove delinquent information and correct data that had gone unmaintained for a decade. NSA has become a valued partner of XYZ over the last 5 years, every day we take the business credit burden off of XYZ through monitoring, building, and improving each report, now XYZ can continue to grow their business without worrying about their business credit adversely affecting investor relationships.
The North Shore Way – Our program is designed to fix, change, correct, and delete information that is hurting the credit scores and indexes of your company.
Due to the complexity of business credit reporting, scores and indexes can fluctuate for a variety of reasons. Score and index threshold changes can be caused by something as small as a recent late payment from a vendor account or a high dollar collection account caused by damaged goods returned to the supplier with a resolution pending.
North Shore Advisory has a team of business credit experts who will cater their approach to the repair and building of your company’s credit based on your individual needs and the requirements within your industry.
Nate owns a construction company, during the recession his business suffered immensely and he ran into severe financial issues. He was forced to lay off several of his valued staff members and fell behind on accounts with suppliers that he had developed a great relationship with. The only reason Nate was able to stay afloat was due to his larger, more regular, clients. After the economy picked back up Nate saw an upswing in revenue and decided it was time to rebuild his once flourishing business. In order to begin landing new larger accounts he knew that he had to make right with his suppliers.
Nate came to find that his suppliers were no longer willing to offer him payment terms; he had gone so far beyond terms that his delinquencies had turned into judgments against his company. His business credit was butchered leaving him with few options for obtaining good payment terms, let alone landing larger accounts.
After working tirelessly to speak to his suppliers and the bureaus nothing changed – he could not even make contact with any rep at Equifax. Nate feared that if he did not take action his business would backtrack to where it was in 2009.
Sourced from Experian’s 2016 Q3 Main Street Report
During his Google searches he recalled our company and decided the best course of action was to reach out to a business credit specialist. Nate took a leap of faith and judging by NSA’s superb reputation decided to hire us. Within 90 days we were able to remove 80% of the accounts impacting each report and we helped him rebuild his once healthy profiles with the right accounts and information.
For close to three decades, the North Shore Advisory team of FICO Certified Expert Credit Negotiators lead by Tracy Becker, President, Expert Credit Witness, Author, & FICO Certified Credit Expert, have focused on credit score/index problem solving and therefore have helped countless business owners and individuals reach their credit goals.
NSA is not in the business of lending and does not hook clients in by offering business credit services to ultimately introduce and provide high priced financing like many companies do. We provide a unique, honest, and reliable approach to business/personal credit repair, building, and monitoring. Through forensic analysis and research, we develop custom strategies for each client to bring the greatest success possible and give a clear view to the client as to whether the goal is attainable and the steps needed to get there.
Clients have gained the financing, partnerships, vendor, and creditor relationships needed to succeed and grow from the programs provided by our expert credit team. NSA has been the trusted resource for thousands of lenders, CPA’s, business consultants, and attorneys and is well known for the highest level credit services that support businesses and individuals. North Shore clients are placed in the best credit position for further success leading to financial and credit goals that were otherwise unobtainable. We do not outsource any of our services and our boutique style of working closely with our clients has helped us maintain an outstanding reputation for close to 30 years.
After becoming the leader in the personal credit scoring field, and gaining a reputation with professionals as the “best in the business” which includes the highest level programs combined with the best customer service, clients began coming to us with questions about repairing and building their business credit.
Our intense curiosity and desire to solve problems and yield results for our clients, drove us to uncover the intricacies of building/repairing business credit profiles and score/indexes. As we became more knowledgeable of the inner workings of business credit we began to see a growing demand for education and insight into the highly unregulated field of business credit and how it can impact a company’s success and future.
North Shore also became aware of predatory firms that sought out those in need of business credit services with the ultimate goal of offering financing at very high pricing. We made a commitment to stay focused on providing the best possible credit programs with our clients interest in mind rather than using these services to ultimately sell financing. With this priority our clients and potential clients feel comfortable with our integrity and intentions.
The NSA team made a commitment to revealing how the unregulated business credit environment can have hidden consequences on a business’s ability to grow and succeed. By educating, building, and repairing business credit our clients can present the most attractive first impression and that is what we strive to deliver. We serve businesses of all sizes.