Building business credit is an important element especially when you need to borrow money for starting new business or expanding your current one. Most businesses want to be able to borrow money when they need it, without the owners having to guarantee the loans personally so as to minimize their risk.

There are essentially some important steps to follow while establishing business credit:
Setting up a correct corporate structure and ensuring that your business appears stable and real to the credit bureaus. This means that you must get the proper occupational licenses and a listed phone number with directory assistance in the businesses’ name, among other things.

Borrowing or buying products and services from companies that will report your credit history to the major business credit reporting agencies such as Dunn & Bradstreet and Experian. Unlike personal credit ratings, best business credit scores are reserved for large stable businesses with several million dollars in sales a year and 25-50 or more employees. However, you can start small and gradually build your business credit rating to get the requisite borrowing power that your enterprise will eventually need.

It is essential to separate your personal credit from your business credit. Thus, even if your business fails to pick up, your personal credit will remain untouched. Similarly, if your personal credit takes a downward spiral, your business rating might also get affected even though it may be doing well and have nothing to do with your personal finances.

To ensure this separation and build business credit, you need to first form an LLC whereby your business becomes an entity unto itself. Next, you must have a Federal EIN and open a separate bank account under the exact legal name of the business and obtain all necessary business licenses, permits, etc.

It is imperative to open a business credit file with all of the three major business credit reporting agencies, obtain five vendors and/or suppliers that will extend a small amount of credit to your business and report your payment histories to these agencies.

Get three business credit cards, the transactions of which will be reported to the business credit agencies. Most importantly it is important that you pay all your bills on time.

By: William Brister

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business marketing plan

So you want to start up a new business? You’ve done your research into the existing businesses and checked out your competition whilst gaining some hands on experience along the way. You’re armed with your business plan, outlining your every move from your objectives, strategies, and target market to your financial forecast. There’s just one little hurdle left to leap over, the decision and arrangement of business finance.

More and more businesses and new ventures are failing to get anywhere past the starting line. There are two main reasons why most businesses fail; poor management plans and inadequate business capital, which is why raising money is important in the early stages of a business.

So why is this need for finance so important? As a new business you will need not only a place for your business to be housed in but also all of the necessary equipment that will be needed to make sure your business is running to its fullest. This start up capital will be used to pay for:

o The renting/buying of a premises/office space, which will require payment of three months in advance.

o Any machinery or office equipment

o Business services such as insurance

o The purchase of stock

o Wages and salaries

o Any financial cover you may need while waiting for customers to use your business

In order to gain the correct business finance and to make sure that people will be willing to invest in your business it is essential to have a well structured and developed business plan. It should state how your business will be different from the competition, why people will use your business and how you will supply your customers with what they require. Research has been conducted that has found companies with a structured business plan stating their overall goals and how they plan to move their business towards them make a considerably higher profit than those that don’t.

Most avenues that you chose to go down in order to secure business finance won’t come near your business without this business plan. So what are your options when it comes to business finance? There are many options open to you but that doesn’t mean that all of them are right for you.

One of the first places that people go to for business finance is there bank. Although banks are still the most common form of business finance it doesn’t automatically mean they are the best. All banks vary in terms of what they can offer start-up businesses, so it is important to talk to a number of them before making a decision. Banks will also expect you to put some of your own money into the business; as a new business venture you may not be able to afford this.

Another form of business finance is asset financing. This is a line of credit that is secured by assets such as real estate. So as a new business venture you can use these assets as collateral to obtain capital. However if payments aren’t made your assets may be seized.

An ever popular choice of Business Finance for a new business venture is a business angel. Business Angels are called this because they often save struggling firms with both finance and advice when no one else will. Angel investors understand the needs of a new business through there own experience and are able to advice and aid the companies in many ways. Business angels are successful entrepreneurs or executives. With their skill, luck, careful planning and good management; they have turned many businesses into profitable ones.

Finally there are venture capitalists who are private investors for financing new or growing businesses and even struggling established businesses. Even though they are high risk investments they can offer the potential for above average returns and/or a percentage of ownership of the company.

By: Helen Cox

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Business Marketing

What business has the least amount of failure rate for new Entrepreneurs?
Magazine, Nightclub/Restaurant, Entertainment Company etc…. What are the possibilities a large company will want to buy into your venture and expand you into a big name?

By: worth isnt measured in figures

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business marketing strategies

I just recently started my own small business after watching my boss make tons of money off of my idea. I’ve been trying to obtain business credit but I am having a problem, because I am a new business. I do not want to use myself as a personal guarantor due to some credit issues I have gained while in college, and co-signing for my ex. So if you have any tips please feel free to post them. Thanks for your time.

By: Mario

About the Author:

Business Marketing

Hello friends,

in this time of difficulties for my family, i have decided to shut down my old business and i am looking for a new business to start. The new business needs to be reliable and profitable. Any suggestions?

By: VJ

About the Author:

Marketing Strategies

My parents are planning to start a new business, and they want to know if the business name that they are thinking of is already being used by some other business in the same industry. How do you find out if a business name is already registered?

By: PinkPanther

About the Author:

Business Marketing

1) Assume they have a family business already running and they start another.
2) Assume they do not have family business and are new to doing business and may or may not have guidance.
3) Assume they worked in management positions and non management positions in any company.
4) Assume that they may or may not have studied business management.

By: Bachelor boy

About the Author:

Business Marketing

I am inbetween careers and I have 150,000 to invest in starting a business and/or to invest in beginning my new career. What business should i consider starting?

By: Matt S

About the Author:

Marketing Strategies