All business owners know that they need an accurate and reliable business credit report regularly in order to manage the risks associated with extending credit to business partners and clients. In today's struggling economy, the business credit report is the best way to determine the creditworthiness of an account and to reduce the risk involved. If credit is provided to an unqualified account then a major financial disaster could result, especially if the account doesn't repay the loan. It is vital that businesses make good credit judgments in order to have success in today's economy.
The business credit report is an accurate and objective document that provides businesses with the vital information they need to make a sound decision about whether or not to extend credit. With today's global marketplace, it is impossible to personally inspect all facilities on a short notice. Therefore, the global entrepreneur needs to rely on a small window through which they can inspect that operations of a partner that is located on the other side of the globe. A business credit report provides a credit risk manager with all the vital information they need including the following:
The business credit report is an accurate and objective document that provides businesses with the vital information they need to make a sound decision about whether or not to extend credit. With today's global marketplace, it is impossible to personally inspect all facilities on a short notice. Therefore, the global entrepreneur needs to rely on a small window through which they can inspect that operations of a partner that is located on the other side of the globe. A business credit report provides a credit risk manager with all the vital information they need including the following:
- Banking, leasing and insurance information
- Contact information and corporate registration
- Credit rating inquiries made in the last nine months
- Detailed credit history
- Filings for bankruptcy
- Financial information including balance sheets
- History of payments on accounts
- Important facts about the business
- Judgment filings against the business
- Names of management and stockholder
- Prediction of future payment behavior
- Tax lien filings levied against the business
- Uniform Commercial Code filing information
- So how does all this information benefit the business? All of this information helps the business to evaluate all risks associated with providing a particular account with credit. Through the business credit report a credit manager can perform six vital functions:
- Decide how much credit to extend a business.
- Determine if further investigation is needed.
- Be alerted to major changes at a business, such as leadership changes.
- Evaluate the business risk in terms and credit levels.
- Determine the creditworthiness of current customers.
- Know what to expected based on an accounts payment history.
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