As you are getting started in your business, you can use your personal credit for the business. However, establishing credit with a credit reporting service, in the name of the business, is very important. Business credit reports compare the stability of a business to similar businesses participating in the credit reporting service. Businesses involved in extending credit use these reports to determine terms of financing. Suppliers and shipping companies review the credit history of your business when deciding whether to grant a line of credit. Firms participating in a business credit reporting service are more visible in the marketplace. Being listed with the business reporting service helps consumers find your company through internet searches that link the firm’s name to the name or key words in the firm’s credit report.
To start the process of building a credit file for your business, obtain a tax identification (ID) number from the Internal Revenue Service (IRS). Next, obtain a unique identification number for your firm, called a Data Universal Numbering System (DUNS) number, through http://www.dnb.com. Once you have obtained the DUNS number, become a subscriber of a reporting service by submitting financial statements and registration information on your business to one of the three major national credit reporting agencies. To ensure the most favorable credit rating, include the strongest or most well-established opened trade line-of-credit accounts in your registration information. The reporting agency will contact the creditors you list for the most current information.
A business credit report includes information such as:
- Commercial credit risk score
- Potential for business failure indicators
- Credit filings in existence for secured property
- Business ownership information
- Other businesses owned by the same organization
- Public records of security interest filings
The three major national business reporting agencies are: Dun and Bradstreet, Experian Business, and Equifax Business. Each of these agencies has extensive information on their web sites regarding their services. Contact us at (425) 780-4530 to learn more about pricing and additional services.