Business Credit is often ignored as a major source of financing for a small or home based business. Many “experts” will tell you about the ways to get money from your home equity, retirement, personal savings etc., to fund your business. In fact, business credit is, the capital required to conduct business. Business credit is perhaps one of the most, if not the most, sought after wealth building tools on the planet. Smart business people resognize the incredible leverage a line or several lines of business credit provide.
Business Credit is convenient as well as flexible. It has been, in my experience ,a way to manage cash flow with ease. It represents a long-term finance solution to help me effectively manage my daily cash flow needs. Without good business credit, growing my business would be terribly difficult.
However, when building your business credit a specific process must be followed and done correctly for it to work. Your profile must be set up correctly and it must be maintained. There are steps you must take, and although it takes time there are some things that you can do to accelerate the process a bit. Nevertheless building true corporate business credit is a process that takes careful planning, preparation, and most of all… action.
There are several companies that offer to implement this process for you at the cost of thousands of dollars; however you can actually do it yourself. For small or home based business owners who are just starting out or who simply want to build corporate business credit, having to come up with thousands of dollars to build business credit may not be practical.
Benefits Of Business Credit:
Business credit establishes credibility.
Business credit is one of the ways that a banker can determine your financial health. This is especially important when you wish to expand, and may not have the on hand cash.
When the business credit process is followed correctly and your business credit is established, your will have access to credit lines with which to expand your business without having to worry about the cash flow problems that often plague small business owners.
Points To Consider:
Lenders will only lend so much to a new business, and they normally do not grant loans to start-up enterprises that do not seem to be good risks.
Simply staying in business past the first two years will improve your business credit outlook. Building your business credit is a process that will, of course evolve over a period of time.
Finally, when approached from the right angle business credit can actually be given a solid foundation within 90-120 days. In my own experience I was able to do this with one of my corporations which I started from scratch. Within 120 days I had several lines of credit and within another month, an unlimited line of credit from American Express.
This corporate credit scenario has enabled me to reach points in my business that I otherwise would not have been able to reach. So after looking into corporate credit, and the benefits thereof, go and grow your business like the big boys.
