As a small business owner, it can be challenging to manage the daily operations of your business. You will probably need some tools and employees to make life easier. Maybe you're worried about where you will get the money.
Have you ever thought of building your business credit, so that you can access funding?
This might be useful based on how you plan to expand in the future and what you need right now. Here's a look at how to build business credit fast.
How to Build Business Credit by Making Your Business Known
If you’re a new startup or just about to open, that probably means that people don't know about you. In order to establish credit, you have to make your business known.
Start by getting your business number listed in the directory. Open a business bank account under your business name and use it to mainly pay bills. Also, open a business credit file to get your business credit established.
Get a social media presence and start communicating with your audience. This will gain you some attention and let creditors know that you are serious about your business even though you are a startup.
Work on designing your website to make it look professional. All of this tells your creditors that you are a legitimate business.
Build and Maintain Good Credit
Building and maintaining good credit with your suppliers and vendors does a world of good for your business. Based on the nature of your relationship with them you might not even need to pay upfront.
Try to establish a secure line of credit with about three to five vendors or suppliers who can report your payments to credit reporting agencies. This can help you to build a positive credit history.
Get an Employer Identification Number
Get a Federal Tax Identification Number for your business. This will be necessary if you want to change your business to a corporation.
It is also needed to open a bank account using your business’ name or even to secure business contracts.
This is rule number one. By paying your bills early and on time it says that you’re dependable and can manage to pay off your debt.
Late payments lower your credit rating and create a negative impact on your business credit profile.
Open a business credit card with a creditor who reports to a major crediting agency. Have at least one card. However, be careful with use and don’t overextend your business finances.
Final Tips to Help Build Your Credit
Now you know how to build business credit and take your business to the next level. It makes a world of difference for your business especially in terms of growth.
As a newly established business, it might be frustrating managing finances. Establishing and building credit can help you. Simple things such as getting listed, paying bills in advance and getting a business credit card are a few ways to build good credit.
If you would like more business tips, please visit the marketing and services section of our blog.