DIY Corporate Credit Series: Your Company’s Profile, Banking, Assets, Revenue and Insurance
Lenders, credit cards companies, vendors and other potential creditors will review your company from various angles before granting credit. Establishing corporate credit means establishing your company’s profile. Today, in our DIY Corporate Credit Series, we briefly discuss the following:
- Business Bank Account
- Company Assets
- Corporate Revenue
- Business Insurance
Your Company’s Profile and Business Bank Account
Creditors will look at the age of your business bank account. As far as creditors are concerned, you began conducting business the day that first account was established. So, establish a business checking account as soon as possible, and maintain it throughout the life of the company. And, make sure the business information on the account matches the rest of your company’s identity documents and sources identically.
Many business credit experts recommend having an average minimum balance of no less than $10,000. It should be in your company’s primary business checking for at least the last three months.
Your bank rating is not as complicated as you may think. This is how business bank rating works in general:
- The scale is Low, Medium and High
- It’s based on the amount of digits in your average minimum balance
So, let’s say the average minimum balance is $1,000. That’s the low end of 4-digits, making your bank rating a “Low 4.” However, if it’s $50,000, which is the medium portion of 5 digits. So, the bank rating would be a “Medium 5.”
Your Company’s Profile and Company Assets
Does your organization own assets? Then, congratulations! You have a much better chance of obtaining corporate credit and the capital you need. That’s because many assets can be sold or leveraged in order to obtain working capital. Assets also give you access to more lenders willing to work with you, as well as more favorable loan terms.
Your Company’s Profile and Corporate Revenue
You’ll need to show creditors and lenders that your business is capable of managing debt. That means having verifiable revenue. And, the best way to support the consistency of this corporate revenue is by making timely payments. This shows that you not only bring in enough revenue to manage the company, but you manage the revenue itself properly. Creditors and lenders weigh this greatly as you try to build corporate credit.
Your Company’s Profile and Business Insurance
If you’re seeking bank financing or loans, most will require proof of various types of business insurance. These institutions want assurance that debts will still be repaid in the event of unexpected catastrophes.
For example, if your personal health fails, you can’t run the business. If you’re in an automobile wreck, and you’re uninsured, you stand the chance of being sued. And, if a customer or employee is hurt on your premises, that could be disastrous for you and the company.
So, banks may require proof that you have personal health insurance, automobile insurance, business liability insurance, maybe even disability insurance. These are very important for establishing corporate credit with banking institutions.
Your Company’s Profile Online
You need to establish your company’s profile online as well. That means having a responsive website, regularly published, unique blog posts and social media marketing for your business brand. Ready to get started? Contact EntreMarketing Group about customizing a business brand building package for your business today.
This concludes our DIY Corporate Credit Series. Would you like to review this series all in one place? We’re putting together an eBook for you to download. Come back next week to get your free eBook download DIY Corporate Credit Series: How to Establish Business Credit for Your Company.