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Expert Answers to Biz Questions
Listen in! Pick up some expert advice to a reader's question that we selected from CyberSchmooz.
Top things to bolster your business credit profile
Businesses can rarely manage on their own especially in the very beginning. Most often, a new company or even an established company will require some help in order to keep everything running smoothly and make sure there are no hiccups in the process of conducting business. Thanks to modern solutions, it can be easy to form the misconception that you can just waltz in the nearest revolving credit facility and get yourself a fat credit line. While securing a line of credit is more or less very manageable today, there are still things you need to consider beforehand. You need to decide what type of loan better suits your company and most importantly you need to make sure that your company’s business credit profile is looking good.
The importance of having a good business credit score
Your credit profile as a business is almost like a specialized business card, but instead of potential customers it is used for things like suppliers, business partners and even financial institutions, like the kind which provide you your loan. The better your credit profile looks, the easier it is to acquire help from other organizations and to conduct your business properly. If you have a low or terrible score, other companies and institutions just won’t want to work with you, out of common sense and self- interest. If you want to know how you can manage and boost your business credit score, check out the rest of this article.
Update your credit bureau information
Your credit report might be managed by one of multiple credit bureaus. Since you don’t really know which one is evaluating your credit report, it’s best to make sure that you are in good standings with all of them. Credit bureaus will allow you to upload important business reports and update your company’s information so that plenty of information about your company is available for those interested. This benefits you a lot because credit institutions will have a lot more info to work with.
Benefit from respecting trade agreements
If you are working with external suppliers, you can actually boost your credit profile a lot by having those suppliers report back to the credit bureaus. If you pay off your suppliers in a very short timeframe from when you receive the supplies, you show that you are respecting the terms of agreements set in place for that trade. This will boost your credit significantly as long as you keep respecting the agreement. The important thing however is to make sure that all this is reported to the bureaus by your suppliers.
Only borrow from those that will make sure people know you’re good for it
If you are going for a loan or some form of financial aid, make sure to use lenders that will report your activity. Similarly to the supplier situation, by staying true to your end of the bargain, you stand to increase your credit score substantially as long as it’s being reported. Just make sure that the institutions you are borrowing from report your activity and as long as you maintain an outstanding record on payments, you should be golden.
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