Credit

Aug 28 2019

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Online Company Credit Check and Business Credit Check

The decision to offer credit facilities is very much an individual choice. After all, you re running the business: you can set the rules to suit yourself. At least, that s the way it seems in theory.

In the real world of business, the decision to offer a company credit will depend on a number of factors – most of them beyond your control. When making this difficult decision, bear the following points in mind and use them to make your choice.

Do You Have a Past History to Refer To?

In some cases, you can use your previous experience with a client to inform your decision about any future credit arrangements. For example, you might want to start off taking a deposit, then extend more credit over time.

Be aware that some companies can seem genuine, but they may disappear when larger bills are due to be paid. Past history can give you an idea of a company s intentions, but it s no substitute for a proper credit check.

Where Is the Client Located?

Chasing debts is always time consuming and expensive, but chasing overseas debts is a completely different ball game to debts within the UK. Take care not to extend too much company credit to one business, and factor in the cost of debt collection.

If your invoices are large, and the company credit limit is correspondingly generous, you could lose a huge amount of money and incur massive debt collection costs. Conversely, small invoices are almost impossible to chase and settle in a cost-effective way.

What s the Company s Credit Rating Like?

CheckMyClient s company credit reports give you a broad overview of a company s creditworthiness, complete with a credit score and an assessment of risk. These figures are compiled using the data in the report and our own experienced assessment of the likelihood of problems, based on the data in the report.

The company credit score is probably the single most useful tool available to you, and it s so easy to understand, you won t need to invest a huge amount of time crunching numbers to make a decision. We even recommend a credit limit that we feel is reasonable, based on that company s past history.

In Conclusion

Entrepreneurs and small business owners can set payment terms according to their own needs. Clearly, there s often a requirement to compromise with a client in order to get their business, but don t feel pushed into setting terms you aren t happy with. If you ve checked the company s credit before negotiations start, you can be justified in sticking to your guns if you don t feel that company is a good credit risk.

  • Order a business credit check in just 5 mins
  • We look at the latest data available and have a 5 year credit history
  • All Company Credit Scores emailed to you and stored online
  • Improve your companies cashflow reduce the risk of bad debt.
  • Costs from just Ј10



Written by CREDIT