Managing Your Credit

Business Credit Score: Why you know yours?

If you're like many small business owners, you probably don't know your business credit score. Intuitively, you know your business score matters, but why?

If you're like many small business owners, you probably don't know your business credit score.  Intuitively, you know your business score matters, but you probably don't know how much it does.

For example, on May 24th the Small Business Administration (SBA) published an article on its blog '5 Major Reasons to Monitor Your Business Credit Reports by Marco Carbajo

To summarize, your business credit score impacts:

  • How much money you can get
  • The cost of that money (interest rate)
  • How fast you have to pay back that money (cash flow hit)
  • The amount of insurance that you need to have.

These are some pretty important things to highlight because they can negatively or positively impact your business.

How do you get your business credit score?

There are a couple of business credit agencies.  For instance, the most popular is Dun and Bradstreet (D&B).  If you use D&B, they will allow you to view your business credit report and update it on-line via iUpdate.

What should you do if you don't have a file?

When you go to these sites, you may find that you don't have a file.  For all reasons stated above, you probably want one.  Therefore, you can start establishing your business credit score. 

It's relatively easy to sign up.  But, it can take time.  For example, if you use D&B, you will need to register for a DUNS number.  This can take up to 30 days.  Once you have that number, you can manually update your data.

Why monitor your business credit score?

Mr. Carbajo shares his five key reasons for monitoring your business credit report.  Certainly, all are important:

First, ensure your company's business credit report is complete and accurate.  Second, stay notified on any changes to your report that could impact your business.  Third, identity any issues or areas in your business credit report that can be improved upon. Next, be aware of who is inquiring about your business (inquiries). Finally, prevent identity theft by monitoring inquiries into your report

What if your file has inaccurate information?

As with your personal credit, it is important to dispute any inaccurate information.  For instance, some agencies have alerts you can sign-up for that will send you notifications of any score changes.  Thus, it makes monitoring your report much easier.  Since the work is on you, the set-up is a bit of a pain.  But, it's worth it. Because once it's done, monitoring your business credit score is not as burdensome as you may think.

Why go through all this trouble to manage your business credit score? 

In other words, you spend a lot of time and effort in managing your business' reputation.  Your credit score is a manifestation of that reputation to creditors.  We spend of lot of time and energy managing our reputation to other audiences. So, why wouldn't we apply that same rigor with our creditors?

Founder Headshot

About the Author

Brian Cairns, CEO of Prostrategix Consulting. Over 25 years of business experience as a corporate executive, entrepreneur, and small business owner. For more information, please visit my LinkedIn profile

Join the 1000's who receive our weekly Small Business Tips
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.
Recent Blog Posts
Small Business Ratios: The Terms to Know
A sample of three of the major Small Business financial terms to know: cash flow, liquidity, and "quick or current ratios" that help in the short-term.
Small Business Banking in 2020: The 3 Things to Know
The look of banking in 2020 has changed. See how building a relationship with a banker or banking expert is even more important than ever considering a new normal.
Top 3 Small Business Financial Ratios COVID Made Critical
Financial ratios for small business is not a sexy topic. But, if there was a way to know if your business was on fire, would you want to know?
Get Where You Want to Be.
Today is the day to build the business of your dreams. Share your challenges with us — and we'll help you make them go away.
Start Now

ProStrategix Advisors Copyright 2020 © All rights Reserved.