The protection that’s awarded to corporate business owners as a result of the American corporate structure is both a blessing and a curse. It not only protects the individual owner’s personal credit history from being tarnished should the business go under, but this same benefit also makes it difficult for lenders to approve credit for new businesses because the risk is so much higher.
Starting a new business is not easy and statistics prove that more start-ups fail than succeed, so how can a new business get the credit it needs to compete when the odds are not exactly in its favor? Luckily, there are still ways to get business credit, but these days, lenders are not so quick to hand it out, so you may have to use some alternative methods to prove to lenders that your business is worthy of their trust.
Apply for a D&B D-U-N-S® Number
Acquiring a D-U-N-S® number from Dun & Bradstreet Credibility Corp. should be your first step toward building your corporate credit history. This number is what other companies and lenders will use to check the credit history of your business, so in essence, you need it before you can really start building your credit.
Take Terms on Supplies
If your company uses certain vendors for supplies, have a few accounts set up for a term pay cycle, such as 30-, 60- or 90-day terms. Do this even if you can afford to pay the accounts up front. While the timely payments to your vendors will not be reflected on your business credit profile, they can be used as positive credit references when it comes time to apply for a loan or corporate credit card.
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