Your business credit history must include
Small Bank Loan
Business Credit Cards
Vendor Lines Of Credit
The SBA reported that vendor credit was the single largest source of small business lending in the United States. There are over 500,000 vendors (companies) who extend lines of credit to their business customers, but less than 5,000 of those report positive business credit histories.
So what exactly is vendor credit? Vendor credit is when a company, like an office supplies provider, allows your business to get the products it needs now but pay for them later. Vendor credit terms are typically Net 30. This simply means you must pay the bill in full within 30 days of the initial order or receipt of goods. Of course there are also Net 15, Net 30, Net 60, and Net 90 day payment terms.
Why does your business need vendor credit? There are two key reasons. The first one is cash flow. Vendor credit gives your business access to the products and services it needs “now” while allowing you to defer the payments for later. This conserves cash flow for your more critical short-term expenses and gives you time to generate the revenue necessary to cover the original bill. Secondly, if the vendor reports your good payment history it will help you to build strong business credit scores. So, the key is in the reporting.
An upside to vendor credit is that it is normally tied only to your business and not to you personally. However, a downside is that there are over 500,000 vendors that extend business credit, but only about 5,000 that report to the national business credit reporting agencies. You will want to select vendors that report.
Keep Your Business Running
Vendor credit lines conserve your cash flow, build business credit, and provide thousands of dollars for needed products and services.
The good news for you is that after researching thousands of vendors, we have compiled a list of over 3,000 who both extend business credit lines and report. You can access these vendors inside our Business Finance & Credit Building System. Even better, these vendors have informed us of what it takes for your business to get approved and we provide you with direct access to that information.
For your business to optimize your business credit scores it is going to need 5 vendor lines of credit that report. Regardless of where your business is at, or the status of your personal credit, if you follow the steps in our system your business can obtain the 5 vendor credit lines it must have to build strong business credit scores. Vendor credit is the engine that drives your initial business credit building success and a major foundational component of the process thereafter.
Once your vendor credit lines are established and reporting, then business credit cards and other types of business loans will begin to open for you. Finding and applying with the right reporting vendors is critical to your success and not a task you should take on alone.