Month: February 2020

How Does Business Credit Work?

Most business owners know that business credit is a thing, but they do not understand how it works.  Many have the idea that all they have to do is apply for credit with their business name to begin building it, but that’s not quite right.  Others have no idea it even exists. You cannot successfully build business credit if you do not understand how it works. So, how does business credit work?

Everything You Need to Know About How Does Business Credit Work from the Ground Up 

The first thing you need to know about how does business credit work is that it does not build passively like consumer credit. You have to actively work to build it. This starts with how your business is set up.  It needs to be set up to be a fundable entity separate from you personally. This is for many reasons, but for business credit it keeps your business and personal credit from getting all mixed up. 

How to Build a Fundable Foundation for Business Credit

We like to call this a “fundable foundation” or a “foundation of fundability.”  Basically, it is setting up your business in a way that makes it appear legitimate and credible.  Some of the factors that go into this are common sense, others may surprise you.

How Does Business Credit Work?  Contact Information

The first step in setting up a foundation for business credit is to get your business its own phone number, fax number, and address.   Surprisingly, this doesn’t mean you have to get a separate phone line, or even a separate location.  You can run your business from your home or on your computer, and you do not even have to have a fax machine.  Find out more about how this works here and here. 

Check out our best webinar with its trustworthy list of seven vendors to help you build business credit. 

How Does Business Credit Work? EIN

Your business needs and EIN.  This is an identifying number for your business that works the same way your SSN works for you personally.  It looks more credible to use this number rather instead of your SSN for business loan applications.  Having an EIN is also important for building business credit, as it separates your business accounts from your personal accounts. You can get one for free from the IRS.

How Does Business Credit Work? Incorporating

Incorporating your business as an LLC, S-corp, or corporation is necessary for building business credit.  It offers some liability protections, but it also separates your business from your self for definitively, which is essential to the business credit building process. 

Which option you choose has more to do with your budget and how much liability protection you need than it does for business credit and fundability.  The best thing to do is discuss the issue with your attorney or a tax professional.  

Incorporation has to happen as soon as possible.  Time in business counts, and it starts over at incorporation.  This is true regardless of how long your business has been in operation before incorporation.  Not only that, but any positive credit history you have related to your business up until the point of incorporation will be lost as well.

How Does Business Credit Work? You Need a Business Bank Account

You have to open an official business bank account.  There are a few reasons for this.  First, it even further establishes your business as a separate entity. Next, it will help you keep personal and business finances separate.  This is beneficial for tax purposes. 

In addition, there are several types of funding that will not be available to you without a business bank account.  Some lenders and credit cards want to see one.  Also, it’s not possible to get a merchant account without a business bank account. That means, you will not be able to take credit card payments.  Consumers tend to spend more when they can pay by credit card.

How Does Business Credit Work? Having the Proper Licenses Matters

A business has to have all of the necessary licenses it needs to be fundable.  If it doesn’t, red flags are going to fly up all over the place.  Do the research you need to do to ensure you have all of the licenses necessary. 

How Does Business Credit Work? A Professional Website is Important

You would probably never dream that your business website could affect your ability to get business credit. However, in today’s world, we all run to the internet first for virtually everything.  Often, the website is the first impression your business makes on customers and even lenders.  A poorly put together website does not make a good impression.

Spend the time and money necessary to ensure your website is professionally designed and works well.  Do not use a free hosting service.  Rather, pay for hosting. Along these same lines, your business needs a dedicated business email address.  Make sure it has the same URL as your Website.  Free email services such as Yahoo and Gmail are not sufficient.

How Does Business Credit Work? D-U-N-S Number

If you do not have a D-U-N-S number, you will not have a credit file with Dun & Bradstreet.  Since they are the largest and most commonly used business credit reporting agency, that would seriously affect your business credit potential. 

Check out our best webinar with its trustworthy list of seven vendors to help you build business credit. 

It’s free and easy to get a D-U-N-S number.  You just go here.  However, be aware that they will try to sell you a number of other products that you do not need.  Just put your blinders on and keep pressing toward the goal of getting that number, which again, is free. 

How Does Business Credit Work? Next Steps

After you have your business set up as a fundable entity, you will have to get accounts reporting to the business credit reporting agencies (CRAs.)  It’s not as easy as just applying for credit and making payments. Here’s why. You have to have business credit to get business credit. Until you have and established score, most lenders will not approve you for funds.  

How do you get around this? The first thing you can do is talk to those vendors you already have a relationship with. With an established relationship, they may be more likely to extend credit without a credit check.  Be sure to ask them if they will report however, because if they will not it doesn’t matter. 

You can also ask utilities and other monthly payments to report.  Electric companies, phone companies, and even internet providers might report your payments if you ask.  They don’t have to, but it can’t hurt to try.

In addition, there’s a little secret known as the vendor credit tier.  These are starter vendors that will award net terms on invoices without a credit check, and then they will report your payments to the CRAs. This will get the ball rolling. 

How do I Find Starter Vendors?

Vendors that fall into the vendor credit tier do not necessarily advertise themselves as such.  As a result, they can be hard to find on their own. Here are a few options to get you started. 

Grainger Industrial Supplybiz credit explained Credit Suite

Grainger sells power tools, pumps, and hardware among other things. You can apply by fax or phone. If you need less than $1,000 in credit, you only have to have a business license for approval. For over $1,000, you will need trade and bank references. 

If you are just starting out and do not have references, the $1,000 is plenty to get you started building business credit. Go here to get started. 

Quill Office Supplies

Quill is popular and easy to get started with. They sell office supplies as well as cleaning and packaging supplies. Generally, you can get most of what you would use in the everyday running of a business from them. 

They report to D&B. If you do not already have a D&B score, you will have to place an initial order first. Typically, they establish a 90-day prepay schedule.  Then, if you order each month for three months, they will approve you for a Net 30 account.

Get started with Quill here.

Uline Shipping Supplies

Uline reports to Dun & Bradstreet.  They carry shipping boxes, dollies, janitorial supplies, and more. Since they report to D&B, you have to have a DUNS number before you get started with them. They will also ask you for a bank reference and two other references. In the beginning, you may need to prepay before they will approve Net 30 terms. 

Find out more about Uline here. 

Behalf.com

Behalf is way of getting paid through an app, but they funding as well. The more often you have customers pay through Behalf, the more likely they are to offer you favorable funding terms.

They offer both purchase financing and virtual MasterCard options. Terms run from Net 30 to 180 days, and they report to Dun & Bradstreet, Experian, and Equifax. This fact alone, that they report to all the major credit reporting agencies, makes them extremely valuable when building business credit.

Find out more here. 

How Does Business Credit Work? The Other Credit Tiers

The vendor credit tier is like a gateway tier to the other credit tiers.  It goes a little something like this. 

Retail Credit Tier

Once there are 5 to 8 or more vendor trade accounts reporting to at least one of the CRAs, then move to the retail credit tier. For example, Lowes falls into this tier and reports to D&B, Equifax and Business Experian. They need to see a PAYDEX score of 78 or higher. The PAYDEX score comes from D&B, so you need a D-U-N-S number for anyone that uses PAYDEX.  Most do.

Fleet Credit Tier

Once you have enough retail accounts reporting, move to the fleet credit tier. This is credit that you can only use to buy fuel, and to fix or maintain vehicles. One example is Shell, who reports to D&B and Business Experian.  They want to see a PAYDEX Score of 78 or better and a 411-business phone listing. 

In addition, Shell might say they want a certain amount of time in business or profits. But if you already have sufficient vendor accounts, that may not be necessary. 

Cash Credit Tier

Here is a good example of how business credit works.  If you handle your credit responsibly in the other tiers, you can start to apply for cards in the cash credit tier. 

These are service providers such as Walmart and Dell, and also Home Depot, BP, and Racetrac. They are usually MasterCard credit cards. If you have 14 trade accounts reporting, then these are in reach.

Check out our best webinar with its trustworthy list of seven vendors to help you build business credit. 

How Does Business Credit Work? The Application Process

Having your business set up properly is only the first step.  Once you start applying for business credit you have to use your business information.  Use your business address, business phone, and EIN. Do not use your SSN as part of the credit application, but be aware that they may ask for it, along with your birthday, for identification purposes due to fraud concerns. 

By using your business information and not your personal information, you ensure your business credit transactions are not mixed up with consumer credit transactions.

Business Credit is Just One Part of Fundability

Fundability is composed of many layers, and business credit is just one part with layers all its own.  It is a large part of fundability, but there is a lot more out there. One thing is for sure, you have to have the same foundation for both business credit and fundability, so it’s best to take care of that part as soon as possible.  To find out more about fundability and what affects it, go here.  

Why Is Business Credit Important to Fundability?

When you look at fundability, personal credit affects it as well.  Knowing that, it’s natural to question why business credit matters at all.  Why do we need two different kinds of credit? There are few reasons, but two of them are glaring once you understand how it all works. First, it costs a lot to run a business, and personal credit limits are not as high as business credit.  If you try to put business expenses all on personal credit, you are going to hover near your limits, which will have a negative effect on your personal credit score. That could keep you from being able to get a loan for a house or a car due to simply running your business. 

Also, if you have a good business credit score, you will likely have higher credit limits available to you. This will help ensure you have access to the funds you need to run and grow your business. 

How Does Business Credit Work? It Is a Process

When trying to answer the question of how does business credit work, you have to remember that it’s not a short answer.  There is a process that has to be followed. It starts at ground level with the foundation. Then you have to travel up several credit tiers, using your credit responsibly and making payments on time as you go.  This will ensure you build a strong business credit score that will only increase your fundability. 

The post How Does Business Credit Work? appeared first on Credit Suite.

A Working Fundability Definition

The definition of fundability is often misunderstood.  It’s hard to get a grip on a fundability definition. The term is thrown around a lot, but few understand what it really means.

Getting a Grasp on a Fundability Definition

Fundability Definition: Foundation

You cannot talk about a working fundability definition without talking about the foundation of fundability.  This is how your business is set up.  It has to appear to be a fundable entity separate from you, the owner.  Like any foundation, it is best to start at the beginning.  It will be faster and easier if you do.  If your business is already up and running however, you may not have that option.  It’s never too late to start, but start now. The longer you wait the harder it will be, for several reasons. 

Contact Information

The first step in setting up a foundation of fundability is to ensure your business has its own phone number, fax number, and address.   Of course, that doesn’t mean you have to get a separate phone line, or even a separate location.  You can still run your business from your home or on your computer. You do not even have to have a fax machine.  

In fact, you can easily get a business phone number and fax number will work over the internet instead of phone lines.  In addition, the phone number will forward to any phone you want it too so you can just use your personal cell phone or landline if you want.  Whenever someone calls your business number it will ring straight to you. 

You can use a virtual office for a business address. What is that, and how do you get one? It’s not what you may think.  There are businesses that offer a physical address for a fee, and sometimes they even offer mail service and live receptionist services.  In addition, there are some that offer meeting spaces for those times you may need to meet a client or customer in person. 

EIN

The next thing you need to do is get an EIN for your business.  This is an identifying number for your business that works in a way similar to how your SSN works for you personally.  Some business owners used their SSN for their business. This is what a lot of sole proprietorships and partnerships do.  However, it really doesn’t look professional to lenders, and it can cause your personal and business credit to get all mixed up.  When you are looking to increase fundability, you need to apply for and use an EIN.  You can get one for free from the IRS.

Incorporate

This is the most important step in fundability thus far.  Incorporating your business as an LLC, S-corp, or corporation is necessary to fundability.  It lends credence to your business as one that is legitimate. It also offers some protection from liability. 

Which option you choose does not matter as much for fundability as it does for your budget and needs for liability protection.  The best thing to do is talk to your attorney or a tax professional.    When you incorporate, you become a new entity. You basically have to start over. You’ll also lose any positive payment history you may have accumulated as well. 

This is why you have to incorporate as soon as possible.  It is necessary for an appropriate time in business. The longer you have been in business the more fundable you appear to be.  That starts on the date of incorporation, regardless of when you actually started doing business. 

Business Bank Account

You have to open a separate, dedicated business bank account.  There are a few reasons for this.  First, it will help you keep track of business finances.  It will also help you keep them separate from personal finances for tax purposes. 

fundability definition Credit Suite

Keep your business protected with our professional business credit monitoring. 

There’s more to it however.  There are several types of funding you cannot get without a business bank account.  Many lenders and credit cards want to see one with a minimum average balance.  In addition, you cannot get a merchant account without a business account at a bank. That means, you cannot take credit cards payments.  Studies show consumers usually spend more when paying by credit card is an option.

Licenses

 For a business to be legitimate it has to have all of the necessary licenses it needs to run.  If it doesn’t, it is a huge warning to lenders.  Do the research you need to do to ensure you have all of the licenses necessary to legitimately run your business at the federal, state, and local levels. 

Website

I am sure you are wondering how a business website can affect you ability to get funding.  Think about it.  These days, you do not exist if you do not have a website. Still, having a poorly put together website can be even worse than not having one at all.  It is the first impression you make on many, and if it appears to be unprofessional, it won’t look good to potential customers or lenders. 

Spend the time and money necessary to ensure your website is professionally designed and works well.  Pay for hosting too. Don’t use a free hosting service.  Along these same lines, your business needs a dedicated business email address.  Make sure it has the same URL as your Website. Don’t use a free service such as Yahoo or Gmail.

Fundability Definition: Business Credit Reports

This is the credit report, much like your consumer credit report, that details the credit history of your business.  It is a tool to help lenders determine how credit worthy your business is.  

Where do business credit reports come from?  There are a lot of different places, but the main ones are Dun & Bradstreet, Experian, Equifax, and FICO SBSS.  Since you have no way of knowing which one your lender will choose, you need to make sure all of these reports are up to date and accurate. 

Other Business Data Agencies 

In addition to the business credit reporting agencies that directly calculate and issue credit reports, there are other business data agencies that affect those reports indirectly.  Two examples of this are LexisNexis and The Small Business Finance Exchange. These two agencies gather data from different sources, including public records.  This means they could even have access to information relating to automobile accidents and liens. While you may not be able to access or change the data these agencies have on your business, you can ensure that any new information they receive is positive.  Enough positive information can help distract attention from negative information. 

Identification Numbers 

Dun & Bradstreet is the largest and most commonly used business credit reporting agency.  Every credit file in their database has a D-U-N-S number.  To get a D-U-N-S number, you have to apply for one through the D&B website. You have to have this number to have a file with D&B, and you have to have a file with D&B to build business credit. 

Business Credit History

Your credit history has everything to do with everything related to your credit score, which is a huge factor in the fundability of your business.  

Your credit history consists of a number of things including: 

  • How many accounts are reporting payments?
  • How long have you had each account? 
  • What type of accounts are they?
  • How much credit are you using on each account versus how much is available?
  • Are you making your payments on these accounts consistently on-time?

The more accounts you have reporting on-time payments, the stronger your credit score will be. 

Business Information

On the surface, it seems obvious that all of your business information should be the same across the board.  However, when you start changing things up, like adding a business phone number and address or incorporating, you may find that some things slip through the cracks. 

This is a problem because of those fraud concerns lenders have.  When business information doesn’t match up, it sets off alarms.  Maybe your business licenses have your personal address but now you have a business address.  You have to change it. Perhaps some of your credit accounts have a slightly different name or a different phone number listed than what is on your loan application. Do your insurances all have the same information?  

The key to this piece of the business fundability is to monitor your reports frequently.   When it comes to business credit reports, you can monitor through the reporting agencies directly, or save money by going here. 

fundability meaning and importance Credit Suite

Keep your business protected with our professional business credit monitoring. 

Fundability Definition:  Financial Statements

Both your personal and business tax returns need to be in order.  Not only that, but you need to be paying your taxes, both business and personal.  

It is best to have an accounting professional prepare regular financial statements for your business. Having an accountant’s name on financial statements lends to the legitimacy of your business. If you cannot afford this monthly or quarterly, at least have professional statements prepared annually. Then, they are at the ready whenever you need to apply for a loan. 

Often tax returns for the previous three years will suffice for personal financials.  Get a tax professional to prepare them.   This is the bare minimum you will need. Lenders may also ask to see check stubs and bank statements. 

Bureaus

There are several other agencies that hold information related to your personal finances that you need to know about.  For example, many business owners do not realize that their ChexSystems report can affect fundability.  In the simplest terms, this details any bad check activity.  It makes a difference when it comes to your bank score.  If you have too many bad checks, you will not be able to open a bank account.  That will seriously affect fundability. 

Everything can come back to bite you.  Have you ever been convicted of a crime? Do you have a bankruptcy or short sell on your record?  How about liens or UCC filings? All of this can and will affect the fundability of your business. 

Personal Credit History

Your personal credit score from Experian, Equifax, and Transunion all matter.  You have to have your personal credit in order because it will definitely affect the fundability of your business.  If it isn’t great right now, get to work on it.  The number one way to get a strong personal credit score or improve a weak one is to make payments on time, consistently. 

Also, make sure you monitor your personal credit regularly to ensure mistakes are corrected and that there are no fraudulent accounts being reported. 

Fundability Definition: The Application Process

First, consider the timing of the application.  Is your business fundable right now?  If not, do some work to increase fundability. Next, make sure that your business name, business address, and ownership status are all verifiable.  Lenders will check.  Lastly, make sure you choose the right lending product for your business and your needs. Do you need a traditional loan or a line of credit? Would a working capital loan or expansion loan work best for your needs?  Choosing the right product to apply for can make all the difference. 

To Understand How to Become Fundable, You Need a Working Fundability Definition

You need your business to be fundable. To make it happen, you have to have a working definition of fundability.  That isn’t really enough however. You also need to understand exactly what affects the fundability of your business, and how to mitigate anything that is holding it back.  Then, you can get to work making sure your business is as fundable as possible. It may take some time however, depending on where your current fundability stands.

fundability meaning and purpose Credit Suite

Keep your business protected with our professional business credit monitoring. 

The post A Working Fundability Definition appeared first on Credit Suite.

The Muse Is Hiring a Data Analyst, Business Intelligence and Analytics

Article URL: https://www.themuse.com/jobs/themuse/data-analyst-business-intelligence-analytics

Comments URL: https://news.ycombinator.com/item?id=22361157

Points: 1

# Comments: 0

The post The Muse Is Hiring a Data Analyst, Business Intelligence and Analytics appeared first on Get Funding For Your Business And Ventures.

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Taplytics (YC W14) is hiring engineering team lead, technical product director

Article URL: https://jobs.lever.co/taplytics/6d4eeafa-4750-4f68-b7af-43454d9f6c43?lever-origin=applied&lever-source%5B%5D=Hacker%20News

Comments URL: https://news.ycombinator.com/item?id=22362516

Points: 1

# Comments: 0

The post Taplytics (YC W14) is hiring engineering team lead, technical product director appeared first on Get Funding For Your Business And Ventures.

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New comment by Mankhool in "Ask HN: Freelancer? Seeking Freelancer? (February 2020)"

SEEKING FREELANCER | Vancouver, BC | Remote OK (must be in BC)

Looking for a mobile app dev to build a photo/video sharing app on both platforms.

This will be the second app I’ve created with Freelancers from HN. This is the only place I ever look for talent.

cultur@mankhool.com

New comment by soner_cirit in "Ask HN: Who wants to be hired? (February 2020)"

  Location: Ankara, Turkey
  Remote: Yes
  Willing to relocate: Yes if I like the location
  Technologies: Elixir, TypeScript - JavaScript - Node.js, Python, Golang, Java, GraphQL, Linux, Cloud Services, Selenium - Appium, Git - Git LFS
  Résumé/CV: https://drive.google.com/open?id=1SwyhEFKQHVQ93mABFKE0aCoBip8RWykn
  Email: sonercirit@gmail.com

Pay-roll Taxes

Pay-roll Taxes

In fact, pay-roll tax obligations incorporate Federal as well as state revenue tax obligation withholding, social protection as well as Medicare tax obligations (likewise recognized as FICA), Federal joblessness tax obligation (FUTA), as well as any kind of state as well as neighborhood joblessness tax obligations evaluated. With the introduction of the EFTPS, or Electronic Federal Tax Deposit System, tax obligations are currently paid on a regular monthly basis by all companies.

The pay-roll tax obligations might likewise be paid by means of a tax obligation promo code that is taken to your financial institution and also provided with the cash to cover the pay-roll tax obligations due.

Every quarter, a Form 941 (or 943 for Agricultural workers) should be submitted with the IRS. The quantities reported on the 941 must integrate to the quantities kipped down every month through the tax obligation discount coupon or the EFTPS. At the end of the tax obligation year, a Form 940 or info return need to likewise be submitted.

If you are a little service with staff members, or you prepare to start running a service with workers, you require to recognize your tax obligation obligations as a company. W-4’s, W-2’s, I-9’s, all the work tax obligations you will certainly be liable for reporting, all the prices linked with those tax obligations. There is an incredible advantage to be had by spending the time as well as sources required to abide and also comprehend with all the government, state, as well as regional guidelines worried with workers and also pay-roll tax obligations.

In fact, pay-roll tax obligations incorporate Federal and also state revenue tax obligation withholding, social safety and security as well as Medicare tax obligations (additionally understood as FICA), Federal joblessness tax obligation (FUTA), as well as any type of state as well as regional joblessness tax obligations evaluated.

With the arrival of the EFTPS, or Electronic Federal Tax Deposit System, tax obligations are currently paid on a month-to-month basis by all companies. The pay-roll tax obligations might likewise be paid using a tax obligation voucher that is taken to your financial institution as well as provided with the cash to cover the pay-roll tax obligations due.

W-4’s, W-2’s, I-9’s, all the work tax obligations you will certainly be accountable for reporting, all the prices linked with those tax obligations.

The post Pay-roll Taxes appeared first on ROI Credit Builders.

Pay-roll Taxes

Pay-roll Taxes

In fact, pay-roll tax obligations incorporate Federal as well as state revenue tax obligation withholding, social protection as well as Medicare tax obligations (likewise recognized as FICA), Federal joblessness tax obligation (FUTA), as well as any kind of state as well as neighborhood joblessness tax obligations evaluated. With the introduction of the EFTPS, or Electronic Federal Tax Deposit System, tax obligations are currently paid on a regular monthly basis by all companies. The pay-roll tax obligations might likewise be paid by means of a tax obligation promo code that is taken to your financial institution and also provided with the cash to cover the pay-roll tax obligations due.
Every quarter, a Form 941 (or 943 for Agricultural workers) should be submitted with the IRS. The quantities reported on the 941 must integrate to the quantities kipped down every month through the tax obligation discount coupon or the EFTPS. At the end of the tax obligation year, a Form 940 or info return need to likewise be submitted.
If you are a little service with staff members, or you prepare to start running a service with workers, you require to recognize your tax obligation obligations as a company. W-4’s, W-2’s, I-9’s, all the work tax obligations you will certainly be liable for reporting, all the prices linked with those tax obligations. There is an incredible advantage to be had by spending the time as well as sources required to abide and also comprehend with all the government, state, as well as regional guidelines worried with workers and also pay-roll tax obligations.

In fact, pay-roll tax obligations incorporate Federal and also state revenue tax obligation withholding, social safety and security as well as Medicare tax obligations (additionally understood as FICA), Federal joblessness tax obligation (FUTA), as well as any type of state as well as regional joblessness tax obligations evaluated. With the arrival of the EFTPS, or Electronic Federal Tax Deposit System, tax obligations are currently paid on a month-to-month basis by all companies. The pay-roll tax obligations might likewise be paid using a tax obligation voucher that is taken to your financial institution as well as provided with the cash to cover the pay-roll tax obligations due.
W-4’s, W-2’s, I-9’s, all the work tax obligations you will certainly be accountable for reporting, all the prices linked with those tax obligations.

The post Pay-roll Taxes appeared first on ROI Credit Builders.