Business Credit Reports - Business Credit Service - Dun and Bradstreet®®

You’ve probably gotten that phone call from Dun & Bradstreet. You know the one, where the representative from D&B tries to pry as much information about your company out of your secretary as he or she can. So in your employee’s defense, you get on the phone and then comes the hammer line... “ Mr. Business Owner, I notice that you have not updated your financial information recently. You NEED to send us your most current Financial Statement so we have them in our file.” Unfortunately, many unknowing employees and business owners fearfully oblige and respond with the typical, “what number should I fax them to?” The next day the information is on your company’s Dun & Bradstreet Business Credit Report.

Big Mistake. I mean BIG MISTAKE.

Who do these people think they are anyway, a government agency for Pete’s sake? Tell the D&B representative to send you their personal tax return for the last 3 years and you’ll send them your financial statements. It’s like that Seinfeld episode where the telemarketer calls Jerry at home trying to sell him something. Jerry responds, “I’m a little busy right now. Why don’t you give me YOUR home phone number and I’ll call YOU back?” You get the idea.

Dun & Bradstreet is nothing more than a marketing company attempting to collect information so they can re-sell it to someone else. They are not affiliated with any government agency and have no right in asking you for your company’s financial statements and you are under no obligation to provide them.

With that in mind, here are the top 5 reasons NOT to provide your financial information to D&B.

1.) By providing your financial information to D&B you just made it available to your largest competitor for only $45. Would you like all of your competitors to have access to your financial statements? Well they do now! Hey, here’s an idea…why don’t you just mail your financials to all your competitors each year with a holiday greeting to make it easier for them. I don’t mean to be a “smart aleck” (as my Mom use to say), but come on! If you going through a tough time or a difficult year, would you want your competitors to know? Would you want your customers to know? Would you like your suppliers to know? Of course not!! I have actually seen wher one company faxed another company’s D&B Report to a potential account they were both competing for. The first company was trying to show their own financial stability compared to that of their competitor’s. Think about it, with whom would you rather do business, a company that is financially sound or one that is financially unstable? Hey, if you are having a difficult time, it’s OK. You will get things straightened out. The world doesn’t have to know.

2.) In a closely held company your financial information is private. You and only you decide who looks at it. You should guard your financial information like a classified government document. Why would you want to bandy them about so that anyone can take a look? If a bank, leasing company or supplier asks to look at your financials, you make that decision as to whether or not you will provide them. This is probably a bit of a personal vendetta toward the Privacy of Personal Information in general but I just feel this type of confidential information should not be available to the general public.

This is obviously not the case with a publicly traded company. Their information is required to be submitted to the Securities & Exchange Commission each quarter in the form of a 10Q report. This information is available to the public at large should they want to invest in the company. Because this information is readily available and is not private, financial statements cannot be removed from the D&B Report of a publicly traded company.

3.) Some of you are probably thinking “I don’t have a problem supplying my financials to D&B. In fact, I am rather proud of them. My company does very well, thank you.” Well congratulations on your past success. Tell me, how will your financials look this year after your top (3) customer’s file bankruptcy or you lose their accounts to a new competitor? What if the labor union gives you a problem and your labor expense goes through the roof? If business were easy and predictable, everyone would be a millionaire. You never know when an unforeseen and/or uncontrollable bump in the road can come along.

After you have had a bad year, you may not be so proud of your financials. But now, by not providing them to D&B a red flag has been raised. A lender thinks, “every year this business provides financials to D&B, but this year it didn’t. I wonder what’s up? Since I know this company produces financials, I better cover my butt and ask for the updated numbers.” If you decide to provide your financials to this lender and your usual $100,000 annual profit has turned to a $100,000 loss, most likely you will be declined for financing. At best, you are going to have a lot of explaining to do.

4.) D&B is not concerned with what your financials say, they only care that the information is in their file so they can re-sell it. This is not meant to be a cut on D&B, but it is a fact. If you have had a down or bad year D&B does not give you a chance to provide a reason or explanation for the slip. There is no narrative text next to the financials.

When you supply your financials to D&B you are subjecting them to D&B’s strict analysis and scrutiny.

As Joe Friday would say, “Just the facts, Ma’am.” D&B’s financial analysis will pick up a downward trend (sales or profits), negative net worth of your company, recent losses and negative working capital (current assets – current liabilities). If you have any of the above financial maladies then D&B will most likely determine your company is “financially unstable” and assign you a 4 credit rating. This is the lowest credit rating you can have and will certainly lead to a decline in any simple credit-scoring model for under a $75,000 financing request.

5.) Congratulations! You just made our mailing list. We routinely purchase lists of companies from D&B with a negative net worth and offer to help them repair the situation. Why would you announce to the world that your company is losing money and is (on paper) worthless?

Individually anyone of these reasons should be enough for you not to send your financials into D&B. www.yourbizcredit.com .