| A Paydex is a score given to a business by Dun | | | | This is because, unlike your personal credit score |
| & Bradstreet. | | | | which is not affected as long as you pay on time |
| Dun & Bradstreet is a businesses credit | | | | by the due date, your Paydex score changes |
| reporting agency. They collect information on and | | | | based on the number of days it took you to pay |
| sell reports and credit scores for every business | | | | your invoice. That means that if your bill is due in |
| almost everywhere in the world. The credit score | | | | 21 days (net 21) or in 30 days (known as net 30) |
| given by Dun & Bradstreet to show how | | | | and you paid on day 21 your Paydex score would |
| timely a business pays his bills is called a Paydex | | | | probably be something around 80 if that were the |
| score. | | | | only thing affecting the score because you paid |
| Dun & Bradstreet collect this information | | | | on the date it was due. |
| from banks credit agencies and businesses both | | | | If you paid a few days after the date due, your |
| on the national and local levels. They gather and | | | | business credit score would probably be |
| manipulate this information to compile reports on | | | | something around 75. However if you paid several |
| which businesses pay or don't pay their vendors | | | | days before the date due your credit score will |
| on time. | | | | be higher and closer to 85 or even 90. |
| The higher your Paydex score is, the better your | | | | Having a 411 listing in the directory as a business |
| payment history is with Dun & Bradstreet. If | | | | is of utmost importance. Experience shows that |
| you're Paydex is 80 or higher you have a | | | | the success or failure of a new and/or home |
| phenomenal business credit score and should have | | | | based business and the likelihood of the business |
| no problem getting approved by vendors for lines | | | | failing is directly connected to the amount of |
| of credit, credit cards, loans and equipment for | | | | energy and investment the owners put into |
| your business. (Age and other factors play a role, | | | | starting it. When the owner doesn't have much |
| but from a computer generated approval for | | | | invested when a business is home-based, the |
| example, on small ticket purchases, you should | | | | company will still have a certain comfort level in |
| not have a problem.) | | | | seeing that you went and got a business phone |
| Let's pick an example. | | | | line are not just using a personal phone line as a |
| Say I want a line of credit with the Home Depot. | | | | business to save a couple of dollars every month. |
| I go to the store or online to their website-and | | | | Even if you're not listed in the Yellow Pages itself |
| then go to the business credit card tool. I then | | | | which may charge money for a basic listing, the |
| choose the revolving business credit line. After | | | | fact that when they call your local Directory |
| entering all the information they request someone | | | | Assistance (411) they can verify that it is a |
| from Home Depot's credit department will take a | | | | business. Having the phone number as a business |
| look at my business credit file. While my file might | | | | phone line shows that you have, in fact, done the |
| be fairly new or empty or activity, there are | | | | steps necessary to be a business which is here to |
| certain things they will want to see to make sure | | | | stay, even though you are based from home. |
| that this request for credit is coming from a | | | | They would feel comfortable that you will sweat |
| legitimate business and not from a half hatched, | | | | out the tough beginnings of starting a company |
| home based, Italian ice selling enterprise. | | | | because you invested your money, your time, |
| What makes a business legitimate in the eyes of | | | | and your energy into making the business stand |
| Vendors and Suppliers? | | | | on its own two feet. |
| Although businesses can be home-based and be | | | | But what happens if you have a payment due |
| legitimate, as many are, and although businesses | | | | and you can't pay on time? |
| can be based at major corporate buildings and still | | | | It is imperative that if you have a payment due |
| get not be legitimate and only using the address | | | | and you cannot pay on time, that you contact |
| as a "front", there are several things that a credit | | | | the vendor and make alternate arrangements |
| analyst for a company as well as unrest to | | | | before the payment is due. This is because your |
| themselves would look at to see the likelihood of | | | | Payment Pattern at D&B, in addition to your |
| this business applying for credit is, in fact, a | | | | Paydex, will change in a yearly if Dun & |
| legitimate business entity. | | | | Bradstreet's model feels that you are less likely to |
| The first thing a vendor will look for is- does the | | | | pay your bills on time in the future. |
| business have a listing with 411? Another is, how | | | | Having a low Paydex score will significantly reduce |
| many square feet does the business have? Is | | | | your access to credit. If you're Paydex is |
| that amount of square footage realistic for the | | | | currently under 70, you should focus and work |
| type of business that this business claims to be | | | | diligently to raise your Paydex to 75 or even |
| and for the type and amount of credit it's | | | | better, to 80 or above before applying or seeking |
| applying for? Is the business based out of a P.O. | | | | new credit for your business. Be its equipment |
| Box or mailboxes etc. type location? If it is, did | | | | leasing, vendor credit lines, or even a business |
| the customer Claim that that is the physical | | | | partnership with another business, since many |
| location of the business itself? | | | | other businesses will check your Duns Report and |
| The Vendors software will figure out based on | | | | Paydex score before doing any partnership with |
| the information they have on your firm certain | | | | you. Also note that your competition can and |
| warnings to watch out for and certain things | | | | many times do buy your Business Credit Report |
| which they would want to verify regarding your | | | | from D&B. and any information you provide |
| business before extending credit to you. | | | | them with on their website or if they call you up, |
| Here's a tip: when you buy products from the | | | | will be reported on your profile and potentially |
| companies that grand credit easily for example | | | | quite easily to your competition. |
| NEBS, Uline, or other such companies that grant | | | | Dun and Bradstreet is not a government agency. |
| credit easily to new and unknown businesses; | | | | It is a private, profit-making enterprise, which |
| make sure you pay them as soon as possible. | | | | must be dealt with carefully to get the benefits |
| You should even consider paying them before | | | | from and yet avoid the pitfalls of them using your |
| you get the bill. As soon as the product arrives - | | | | information against you. |
| Pay. | | | | |