How Business Credit Can Save Your Small Business

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We’ve witnessed more than just the tragic loss of life during the COVID-19 pandemic—we’ve seen the loss of people’s jobs and livelihoods as well. Many people simple were not prepared for the fall.

As a business owner, it can be scary living through these uncertain times, but there are steps you can take today to save your business and have certainty about the future. How? Two words…

Business credit.

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Defining Business Credit

A lot of business owners are surprised to learn that just like they have a personal credit score, their business does too. Business credit is a track record of a business’ fiscal responsibility.

Business owners and vendors report this payment history to credit bureaus like Dun & Bradstreet and Experian who then issue a credit score. Investors, financial organizations, and other companies use this business credit profile to determine whether your business is a suitable candidate for loans or a partnership.

Your business credit profile with these bureaus are where investors and financial organizations look to determine your business’ eligibility for loans or business partnerships.

So, just like having a good personal credit score is important and comes with perks and advantages, so too does having good business credit.

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Why is Business Credit Important?

The #1 reason you need business credit is to separate yourself from your business. Many business owners make the mistake of personally financing their business. They don’t realize that not only is this difficult to sustain, it puts them at serious risk of personal financial loss!

In the current economic climate, separating yourself from your business has never been more important. Business credit protects you and saves your business from potential cash flow issues.

And, if you obtain a more favorable credit score, you’ll lower the interest you pay on loans and leases. It’ll also be easier to qualify for a loan as lenders are hesitant to lend money to businesses with poor credit history

Additionally, you’ll receive more favorable terms from suppliers. This will be helpful when it comes time to purchase additional equipment and inventory as you’ll be able to purchase those thing on credit. If you have a great credit score, suppliers will be more comfortable in forgoing prepayment and allowing you to purchase on credit.

Last but not least, having good business credits gives you access to cash for growth and expansion. That’s the goal of every business right? To grow. Well, the bigger you grow, the more money you’ll need. Having the ability to take out a loan for a business expansion project will allow you to grow your business larger.

Building business credit has always been the smart move of savvy business owners, but it’s more important now than ever before.

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Here are four ways to get started building A+ business credit

Building business credit takes time so it’s important to get started building ir right away!

  1. Form an LLC, S-corporation, or C-corporation (if you haven’t already)
  2. Apply with the IRS for an EIN number
  3. Make sure at least some of your suppliers report your transactions to business credit bureaus
  4. Pay your bills on time. Just like you do with your personal credit, you establish business credit with a good payment record. Whatever bills your company has to pay, simply pay them on time or negotiate repayment plans with creditors.

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In conclusion

Here at Inc Authority we’ve always understand the importance of building good credit quickly. The current pandemic has only strengthened our resolve to give small businesses a fighting chance.

The strategy we’ve developed gets business owners A+ credit fast. Hows it work? Well, when you partner with Inc Authority to build your business credit, you’re automatically enrolled in our  BizCredit Express program. It’s designed to help you build business credit rapidly for your new or existing business.

Along with this, you’ll get a dedicated business credit coach who will register and set up your business profile with Dun & Bradstreet and Experian Business. With your personal credit expert and proprietary web tools you will be able to maximize your credit score and profile with major business credit reporting bureaus.

With our simple process, you’ll start building A+ business credit in as little as 90 days, with easy access to business loans, credit lines, and working capital.

If you want to save your business during these challenging times and have peace of mind about the future, you need business credit.

Contact the business credit experts at Inc Authority to learn more and get started building A+ business credit!

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GET STARTED

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Incorporating is the most powerful thing you can do to legitimize your business. And at IncAuthority.com, our LLC setup service is 100% free. Always. So, don’t wait. Form your LLC today and enjoy the protection due to you and your business under the law. Start now for free.