Building Business Credit Fast
Advantages of Business Credit
There are many advantages to building business credit. To double the borrowing ability, you can build credit in a credit profile that is separate from your business’s predict profile. This is more beneficial than consumer credit, as it has much higher credit limits and capacity. You can build business credit very quickly (30-90 days from the initial profile set-up), and it can be done without a personal credit check. Regardless of personal credit quality, one can build business credit without personal credit reporting of business accounts. Credit can usually be obtained without the owner having liability. This means that personal assets cannot be pursued. Another advantage of business credit: it increases credibility. Since credit reports are public, prospects, clients, lenders, competitors, credit issuers, or someone interested in purchasing your company can view and confirm your credibility. Business credit can be obtained by almost any company if they have an entity setup and EIN. Neither collateral nor financials are necessary to build business credit. Startup businesses can also build business credit if they follow the correct steps.
Types of Business Credit


Building An Initial Business Credit Profile in Three Steps
A new business builds credit the same way that a consumer does. A business starting with no credit profile gets approved for a new credit profile. The business uses credit and pays back the credit in a timely manner. The credit reports to reporting agencies. The credit being paid back on time establishes positive business credit, and the business then qualifies for more credit to use.
Step 1: Credibility
When building a new business credit profile, you are not using personal credit, but business credit. Since you do not have any business credit yet, and you must meet the criteria of a credit issuer when applying for credit, it is important that you have a strong business credit application since this is what will be reviewed.
Legal Entities
Any entity type can be used to build business credit. First, make your business a separate legal entity to ensure your business credit is separate from your personal credit. This means that your business cannot be a sole proprietor or partnership. You do not have a true business unless you have a separate business entity (LLC or Corporation). While other entities do not, these entities eliminate your personal liability.
Name of your Business
Federal Tax ID Number
The Address of your Business

Dedicated Business Phone Number
Another essential item that vendors look for when considering approval of business credit is the business’s phone number. A dedicated phone number with a 411-directory assistance is required. It should not be a home or personal cell phone number. It must be under the business name. It should have an 800 number as well as a fax number. Voice Over IP numbers are acceptable as long as you do not use a home or cell number. Go to ListYourself.net to register with 411.
Email/Website
When considering approval, credit providers research the companies they are approving. Therefore, it is essential to have a professional website where they can learn everything they need to know about your company. A professional email is also necessary and is inexpensive and simple to create. An example of an address: yourname@yourcompany.com. A company lacking either of these items appears unprofessional and uncredible.
Required Licenses and Permits
Before applying, contact your State, County, and City Government offices to determine whether you need any type of license or permit for your business. Do not apply until your company is appropriately licensed.


Check Business Listings
Step 2: Previewing Business Credit Reports
Before getting your credit approved, check your business credit reports to see what is being reported, and dispute any information you think is inaccurate. Dun & Bradstreet, Experian Commercial, and Equifax Commercial all offer business credit reports.
Purchasing from Dun & Bradstreet
To begin building a Dun & Bradstreet credit profile, you can obtain a Dun & Bradstreet number (D-U-N-S #). Your number will help enable your business to borrow without a personal guarantor (free at http://www.dnb.com/). You can enroll for the DNBi SelfMonitor to keep track of your credit while you are building it. This costs $39-$99/month. You can also buy a package from them for $2,000.
Purchasing from Experian Commercial
You can purchase a report from Experian for $49-$99 at http://www.smartbusinessreports.com/. You can also view recent inquiries, check to see if you have an active Experian Business Profile, view how many trade lines are reporting, and check to see if you have a business credit score assigned yet.
Purchasing from Equifax Commercial
Reading and Understanding Credit Reports


Personal Credit Scores: Based on 5 Factors
- Payment history 35%
- Utilization 30%
- Length of Credit History 15%
- Accumulation of New Credit 10%
- Credit Mix 10%
Paydex Score - Dun & Bradstreet
- Expect payment may come early 100
- Payment is prompt 80
- Payment comes 14 days beyond terms 70
- Payment comes 21 days beyond terms 60
- Payment comes 30 days beyond terms 50
- Payment comes 60 days beyond terms 40
- Payment comes 90 days beyond terms 30
- Payment comes 120 days beyond terms 20
Credit Reports List
A Business Credit Reports list includes many items in great detail. They include each payment made on every individual account, upper credit limit, the amount owed on each individual business account, a full payment record, payments and amounts past due, the terms of the account, the last time the account was updated and reported, each account’s payment details, working capital, current assets, net worth, liabilities, and sales. Reports also provide detailed commentary on payment patterns. These reports are set up very differently from consumer reports, so it is important to examine them carefully to accurately assess your business risk.

Step 3: Getting Vendor Credit Approval
Starting Business Credit: 2 Different Ways
There are two ways to build business credit, but D&B Credibility will try to convince you that there is only one. The company charges $2,000 to add tradelines to your report using your current creditors. Building credit here means that what you can add to your report is restricted. D&B only reports to D&B, and building credit here takes time. It does not allow you to build usable credit, they simply add current creditors. The second way one builds business credit is by getting real credit that you use to build your business, similar to how a consumer builds credit. The business credit report that results from this helps to fully establish your business, and it creates a profile and score for your business.
Starting with Vendor Accounts
Vendor Accounts

Initial Credit from Vendors
Starter Vendors Vendors :
Quill Office Supplies
Quill Office Supplies reports to D&B. They sell packaging, office, and cleaning supplies. Without a D&B published score, you will need to place an initial order, sometimes 3 orders of $50 or more, to be approved.
Uline Shipping Supplies
Uline shipping sells packing, shipping, and industrial supplies. To get approved for Net 20 terms, Uline will request two references, a bank reference, and possibly require a pre-payment on your first few orders. They also require a DUNS number since they report to D&B.
Gempler’s/Office Depot
Both Gempler’s and Office Depot report to D&B. They sell work supplies. Building credit with this company requires you to place an order of $50 and choose the “Invoice Me” option. They will pull credit after you pick this option. If they do not approve you for Net 20 terms, prepay for your order and continue to choose the “invoice me” option until they approve you. Placing more orders improves your chance of approval.
Reliable Office Supplies
Laughlin Associates
Monopolize Your Marketplace
Reminders
