Your business credit profile is your company’s financial fingerprint. Unlike personal credit, it’s tied to your Employer Identification Number (EIN) and reflects your business’s reliability in paying bills. A strong profile helps you secure funding, negotiate favorable vendor terms, and protect your personal assets. The best part? You can start building it from day one—even as a sole proprietor. Here’s how (read time: 3–4 minutes).
1. Legally Establish Your Business
Before credit bureaus recognize you, your business must exist legally:
- Choose a structure (LLC, S-Corp, etc.)
- Register with your state
- Obtain an Employer Identification Number (EIN) from the IRS (free at irs.gov)
- Get any required local licenses or permits
This creates a legal separation between you and your business—essential for building standalone credit.
2. Register with Business Credit Bureaus
The three major business credit reporting agencies are:
- Dun & Bradstreet (D&B) – Get a D-U-N-S Number (free at dnb.com)
- Experian Business
- Equifax Business
Start with D&B—they’re widely used by lenders and suppliers. Registration is free and takes minutes online.
3. Open Trade Accounts with Net Terms
“Trade credit” is credit extended by vendors (e.g., office suppliers, software companies). Look for vendors that:
- Report payments to credit bureaus
- Offer Net 30 or Net 60 terms (pay 30–60 days after invoice)
Examples:
- Uline
- Grainger
- Staples (via Staples Business Advantage)
- Dell Technologies
Make small purchases, then pay on time—or early. Consistent, reported payments build your profile fast.
4. Monitor and Maintain Your Profile
- Check your D&B PAYDEX Score (0–100; aim for 80+)
- Review reports from Experian and Equifax Business annually
- Dispute errors immediately
- Keep business info (address, phone) consistent across all listings
Never miss a payment—late or missed payments can stay on your report for years.
Key Tips for Success
- Never mix personal and business expenses—use a dedicated business bank account and credit card.
- Start small—even $50/month in reported vendor payments builds history.
- Be patient—it takes 6–12 months to establish a meaningful profile.
FAQs
Q: Does my personal credit affect my business credit?
A: Early on, yes—many lenders check both. But as your business credit strengthens, you’ll qualify for financing based on your company’s profile alone.
Q: Can sole proprietors build business credit?
A: Yes! As long as you have an EIN and work with vendors that report to business bureaus, you can build a profile—even without an LLC.
Q: How long does it take to get a business credit score?
A: You’ll see initial activity in 30–60 days after opening your first reporting account. A usable score typically takes 6–12 months of consistent, on-time payments.
