As a small business owner, you work hard every day to keep your business thriving. But between dealing with vendors and customers, finding creative ways to market your goods or services, and thinking about the next steps for your company, you may neglect to work on your business’ credit score. Here are a few quick tips to help you increase your business score in your (limited) free time.
4 ways to increase my small business credit score
- Make your payments on time.The most important thing you can do for your business credit score — and your personal credit score, for that matter — is make 100% of your payments on time. While payments late by a few days likely won’t be reported as such, it’s a good habit to get into making all payments before the due date. Plus, you’ll avoid those pesky late fees!
- Keep your debt levels low.At some point in the life of your business, you may need to take out a loan or business credit card to help cover expenses. Try to keep any revolving debt low. This will keep your credit utilization low, which will make your credit score high.
- Use credit!You should still open a few business credit accounts — like credit cards or loans. Credit is a game, and you have to use it to play. Just remember that available credit isn’t free money and act accordingly.
Also, keep in mind that not every business creditor reports credit information. If possible, work with companies who do report.
- Check your business credit report.Yes, your business has a credit report, too! And like your personal credit report, it may not be 100% accurate. Access your credit reports from the various reporting agencies:
Look over your reports to identify any incorrect information and dispute it. Just one mistake could hurt your otherwise good business credit.
Bottom line: Keep your business and personal life separate for credit’s sake! By using the above tips, you can build your business credit and you won’t have to worry about compromising your personal assets if your business goes under. Plus, you’ll be able to obtain larger business loans and more favorable terms.