How To Build An Initial Business Credit Score Using Net 30 Accounts
First, let us review some key facts that you should know about Net 30 Accounts:
You can obtain products, services your business needs, and defer the payment on those for 30 days, thereby conserving cash flow. When your first Net 30 account reports your “trade line” to Dun and Bradstreet, the DUNS system will automatically activ
ate your file if it is not already. This is also true for Business Experian and Small Business Equifax. Some net 30 vendors will approve your company upon verification with as little as a Tax Identification number and a 411-business listing. Some vendors will require an initial prepaid order before they can approve your business for net 30 terms. You must be patient and allow time for the vendors' data reporting cycles to get into the reporting systems of bureaus like DNB. It takes a minimum of three reporting trade lines to establish a business credit score (Paydex) with DNB. So what is the best way to build business credit with net 30 vendors? Once you open an account with a vendor, you must consistently use it. For example, when you receive a $500 Net 30 credit line, you must make purchases from that vendor each month for a period of at least a year. You will build strong scores in as little as 120 days, but to fully optimize your credit profile you need to use the accounts longer. Do not make the big mistake of making just one purchase in the first month, then another in month four and another in month ten. You need to consistently use all your new credit lines each month. Make purchases and then pay-off those purchases in full at least 15 to 20 days early (by day 15-10 in the case of Net 30 accounts) every month. By following these steps, you will be building business credit history for your company in the most effective way possible. Consistency and responsibility is the key to maximizing your scores and enabling your business to qualify for larger credit limits, favorable terms, and the lowest rates possible. Looking for net 30 accounts that report to the business credit bureaus? Follow Kaiim Daids on Facebook and gain access to a proven systematic business credit building system. A system that provides you access to vendor lines of credit, fleet cards, business credit cards with and without a PG, funding sources and lenders that report to all the major business.
