Building Business Credit in 2010
It is no secret that business credit building is getting harder and harder. Three years ago, it was possible to get $50,000-$150,000 of cash credit, with a shelf corporation within 3-6 weeks with a shelf corporation. Getting an 80 paydex took 2 weeks because many companies who offered net 30 accounts were reporting quickly.
Now, 3 years later, in 2009, it seems like everyone is trying to make this process hard. The companies that offer starter accounts want higher purchases in order to report to the credit bureaus. Some of the companies like Bags and Bowes are no longer reporting. I am sure that they have lost a lot of business. And much of our cash credit with no pg is gone. There are only a few guys left. Key Bank seems to want a PG for everything.
I was going to save this little secret, but Key Bank still has an account that does not require a PG and they are giving nice lines of credit. It is a Key Bank MasterCard, but it is a Net 30 account. Key does not promote this account on their website, so you will have to call in and have them fax or email you an application. Many gurus out there will charge hundreds of dollars just for that information.
I have had clients come from huge companies like B2B credit and Business Credit Magic with no results. These people simply scam you. They assume that you do not know what you are doing and they string you along. I want you guys to know that you can build business credit on your own. The process is simple. There is no rocket science involved, you simply follow the process and get it done. You start with starter accounts; net 30 accounts like quill, uline and grainger; then you get to your tier 2 accounts like your staples, office depot and move up from there. It is a basic thing and you do not need to pay for the business credit builder from DnB. I actually show my clients how to get it for free. Yes, you can get a DnB credit builder for free. No one else out there shows you this. But since building business credit is getting harder, this is actually a better reason for you not to pay for the service because you do not get as much credit as you did a couple years ago, so you don’t get your bang for your buck.
3 Ways To Get Approved For a Business Credit Card
If you run your own business–whether it’s a retail store, direct sales, hobby shop or freelance consulting–chances are you’ve thought about getting a business credit card. It’s probably a good idea, since it makes it easy for you to separate your business expenses from your home expenses, a task that helps keep your paperwork organized and simplifies things at tax time. When you’re ready to apply for a business card, follow this checklist:
1. Choose a card
Some cards offer special deals, financing or rewards for small business owners. For example, some rebate cards offer you a percentage back on everything you buy at a certain store, like a warehouse store or online store. Other cards offer cash rebates when you spend at supermarkets, gas stations or home improvement stores. If you travel often, a frequent flier or travel rewards card might get you the best and biggest bonuses. Choosing the right reward card–depending on the type of business you operate and the expenses you incur–can mean extra money in your pocket all year long.
2. Gather up paperwork
You’ll need basic information about your company’s financial situation, including the name of your business, the tax identification number, the business address, the number of years you’ve been an owner, the number of employees, the nature of the business, the business’ average annual income, and the amount in the business’ checking account. You’ll also need to know the legal entity of your business, such as whether it’s a sole proprietorship, a corporation, a partnership, a non-profit, etc.
3. Fill out the application
You can find applications for almost all business credit cards online, although in most cases you can also call and apply over the phone (a good idea if you have any questions). Depending on your credit rating, you may have to provide extra documentation of your business’ current financial status, so be prepared to mail or fax information if requested. After you fill out the application, approval can take anywhere from thirty seconds to a month.
To find business credit cards online, do an Internet search or check the websites of major credit card companies.
Business Credit Builder – Dun & Bradstreet Products Get a Makeover
After speaking with my contact at Dun & Bradstreet yesterday about its duns credit builder products there have been recent changes made this year that are important for you to be aware of. These enhancements are good news for small business owners and make the programs offered at DNB more streamlined and affordable to establish, improve, and protect your corporate credit.
Now keep in mind that obtaining a DUNs number does not cost anything to your company but receiving your number can take over 30 days if you choose the free route. However, you can obtain your DUNs number in less than 24 hours by either purchasing one of its business credit builder programs or if you are a government contractor, government vendor, or grant recipient.
Now let’s review each of its business credit solutions and how they can help build company credit for your small business much faster than the traditional route of waiting for your creditors to report.
DUNs File Creator
Price $149
This product is ideal for you if you need to have a DUNs number issued right away. As soon as you purchase this product they will issue your number in 24 hours and you can have a DNB business file in their system within 5 business days. You have the ability to add extensive information on your file like company background information, operational information and financial statements. One of the drawbacks is that it does not include the ability to add trade references to your file. You will have to wait for vendors, creditors or suppliers to report their payment experience with you to Dun & Bradstreet. So if you are trying to build business credit history fast then this would not be the best choice for you because you have to wait until your suppliers report your payments.
* Tip – there are credit builder companies like the Business Credit Insiders Circle that provide access to vendors, suppliers, and companies that report to DNB for building small business credit.
DNBi Self Monitor Basic
Price $449
If you choose to purchase this product then most likely they will waive the DUNs File Creator fee so don’t hesitate to request it. This particular product is ideal for you if you already have existing trade references that you want to add to your file. This service allows you to submit up to 8 references over a period of 3 months for a total of 4 payment experiences to be added. They allow this extra cushion just in case they are unable to contact one of your references for payment experience verification.
Now if the price on this is a bit of stretch for you then you may want to take advantage of their monthly payment option. It costs $39 per month and requires a 3 month minimum term. Keep in mind that if you select this option you are only allowed to add 1 trade reference per quarter with the option to add more if you continue the service.
The product features for this are similar to the DUNs file creator with the main difference being the ability to add trade references.
*Tip – there are credit builder companies like BCIC that report your payments to Dun & Bradstreet. Not only do they give you access to vendors, suppliers, and companies that report to DNB but they also help you build business credit history too!
DNBi Self Monitor Plus Inquiries
Price $799
This product is similar to the DNBi Self Monitor Basic except that it allows you to submit up to 24 references over a period of 3 months for a total of 12 payment experiences to be added. The basic version allows you only a total of 4 payment experiences to be added. They provide this extra cushion just in case they are unable to contact one of your references for payment experience verification.
In addition you have the ability to track the inquiries that others are making into your business credit file. This is a great way to make sure you are up to speed on the latest information that vendors, banks, suppliers and customers are seeing and an effective way to determine if your business is generating the positive interest it needs in the marketplace.
If you choose to purchase this product then most likely they will waive the DUNs File Creator fee so don’t hesitate to request it. This product is ideal for you if you already have existing trade references that you want to add plus closely monitor the activity and inquiries on your file.
DNBi Self Monitor Premium
Price $1,399
This product is the grand daddy of DNBs business credit solutions. In my opinion it’s a big upgrade to DNBi Self Monitor Plus Inquiries product because it allows you to submit up to 200 references over a period of 6 months for a total of 100 payment experiences to be added. The ‘Plus Inquiries’ version allows a total of 12 payment experiences to be added. That is 88 additional references you can add with this product and 6 months time frame to do it.
Some of my members who have been in business for years who now realize they need to build business credit history found this product to be a no brainer. Since they already have long standing relationships with many companies they quickly have the ability to add dozens of trade experiences to their files and create a paydex score of 80+ in a matter of weeks!
I hope you find these product reviews helpful so you can get started building corporate credit for your business today.