Most entrepreneurs use their personal savings, borrow from relatives and patch together enough funding to establish business credit while starting a new business. Although they have the characteristics of successful entrepreneurs, but what they lack in is excellent business credit. Many entrepreneurs do not have great credit, some start business when they are laid off, some start when opportunity strikes and some go through divorces and bankruptcies that may have ruined their credit.
If you are new to business or have a bad credit history, here are some useful steps for you that may help you establish good business credit.
- First and foremost, get your occupational licence.
- The next step would be to get your Tax ID Number or if you are an independent contractor with no workers, then you may also use your Social Security Number.
- Next open a checking account in the name of your company with you as the only signer and get some paper checks.
- Next, inform all the three credit bureaus about your business and ask them to open a record.
- Then contact places like Staples and open a business/revolving type credit card under the business name with only you being the signer.
- Once approved, buy some items related to your business like accounting supplies, stationary, etc. Buy anything small that you can repay easily.
This procedure will surely help you establishing a good business credit. There are other things that are associated with setting up credit for your business, however, these are the initial steps to get you running and once your business is setup, you will find new challenges.
|
