What is Business Credit     Benefits of Good Credit     Who is D & B      Archived Articles     Our Company     Contact Us     Thursday, November 20, 2008

Here are the top (6) benefits of having a good business credit report.  Any one of these benefits are reason enough to keep your credit report in top condition.  
  
1.)  It can save you a ton of money.  

Let’s say you need $50,000 for a new forklift.  Without a D&B® Report, using your personal credit only, IF you could get approved, your rate could be around 18% (or higher).  With a solid D&B® Report showing comparable credit as to what you are requesting to borrow, your rate will be closer to 10%  with no personal guarantee.  
   
Let’s take a quick look at the comparison:   


                                      W/O D&B®             With D&B®

Lease Amount                  $50,000                  $50,000

Interest Rate                    18%                       10% 

Term of Lease                  60 months              60 months

Advance Payments            0                            0

End of Lease Option          $1 Out                    $1 Out

Monthly Payment              $1,269.67               $1,062.35

Total Payments                 $76,180.20             $63,741.00

   
                                    Total Savings:      $12,439.20 

Typically, there is a lender for every transaction.  If you have a good business credit report, your rate will be good.  If you have a bad business credit report you will either be declined or you will pay a higher rate.   
 

2.)  You can obtain business credit without the need for a 
      personal guarantee.   
 

You want to separate your business credit from your personal credit as quickly as you can.  So stop using your personal credit to support your business!  With a good business credit report you will be able to get approved for financing using the business’s credit only.   This reduces your personal liability and protects your personal assets should the business be unable to pay the loan or lease.   
 

3.)  It helps you stay ahead of your competition.  
 

Paying less for your money than your competition gives you a monetary edge.  You can pass your interest savings onto your customer in the form of lower pricing or you can keep a larger margin of profit for yourself.  What if you are bidding on a job and the company providing the contract pulls a D&B® Report on you and your competitor?  Who will get the job?  Give yourself the edge and have your credit report in great shape!  
 

4.) You can act and make decisions with confidence that you 
      can get the money you need.  
 

Having a superior D&B® Report is prestigious.  Knowing that you can get the equipment or cash you need reduces a lot of stress on you and your company.  With a good D&B® Report you can feel confident that any money you need is quickly obtainable.  
 

5.)  D&B® Reports are now being pulled in many states to 
      determine Workman’s Compensation rates. 

   
This relates to saving money but in a different way.   In essence, insurance companies are now charging a premium on companies who have a poor D&B®.  We can argue the merits of a relationship between bad credit and the higher chances of an on the job accident all we want but the reality of it is, this is what’s happening.  We have even seen (2) cases where a company could not get Worker’s Compenasation insurance at all!   You don’t need that headache.   
   

6.)  You can save a lot of time later.  
 

By repairing and maintaining your business credit report now, you will save yourself time and effort later.  Many people come to this site because they have been declined for financing due to negative information on their D&B® Report.  That may be the situation you are facing right now.  All we are saying is that once you have your report in its top condition, the amount of time and work to maintain it at that level is minimal.  Once repaired, don’t let your report go to the birds.  Keep it in good condition so you don’t have to go through fixing it all over again.  Depending on the severity of your problems, repairing your report can take up to four to six weeks.  You don’t want to have to do it twice.  

A smart businessperson realizes the importance of always maintaining the best credit profile possible for their company.  Business moves fast, you need to always have your company in position to get immediate financing at the best pricing should an opportunity arise.