When small business owners pay close attention to their Dun and Bradstreet business credit scores, it makes it easier for them to get approved for trade credit, business credit cards, and business loans.
D&B Scores
Of all the major business credit bureaus the ratings and scores found within your D&B credit report will carry the most weight when trying to build business credit quickly.
Vendors who offer net 30 credit typically want to know your trade payment history. The higher your PAYDEX score is, the more likely they’ll be to extend your supplier credit. By simply paying your suppliers early rather than just on time, you can instantly boost your score. The more tradelines you open and the higher the total dollar value of your early payments, the faster your score will increase.
None of the other business credit reporting agencies offer such glimpses into a company’s reliability and financial stability as Dun & Bradstreet does. The operational information and predictive stability scores found in your D&B ratings also help instill a sense of confidence that you will be able to pay your future invoices too.
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How to Improve
Follow these 11 steps to build or repair your Dun & Bradstreet credit profile while increasing your PAYDEX business credit score and ratings.
- Fully maximize net 30 account reporting
- Always pay your net 30 invoices as early as possible
- Always pay your invoices on time when you can’t pay early
- Pay your largest invoices first to get PAYDEX score boosts
- Manually submit trade references from vendors who don’t report
- Request extended payment terms to increase the positive payment window
- Ensure you have at least 3-4 active tradelines every month
- Constantly monitor your D&B credit scores and fix issues quickly
- Manage your debt-to-credit utilization wisely
- Share your financials, company info, and employee data with D&B
- Regularly update your Dun & Bradstreet credit profile
Net 30 Vendors
To start receiving a PAYDEX score for your business you must have at least three active tradelines that report regularly to Dun & Bradstreet. If you are a recent startup, then you should immediately start applying to our top net 30 vendors for new businesses before doing anything else.
For quick D&B reporting, we highly recommend applying to Nav Business Boost, Capital One Sparks, Maverick Office Supplies, Crown Office Supplies, and Summa Office Supplies.
Within 30 to 60 days from paying off your invoices, you should start seeing a D&B PAYDEX rating appear in your credit file. This business credit score is solely based on how fast you pay your net 30 bills, so pay them on the same day they’re invoiced if possible.
Once you have a few tradelines reporting regularly to Dun and Bradstreet, you can then start applying for net 30 vendors with easy approval.
Your second round of credit applications should include companies like Office Garner, CEO Creative, Shirtsy, and JJ Gold. who also report to business credit agencies like Experian, Equifax, and Creditsafe, along with D&B.
When you have 5-8 tradelines reporting you can then start applying to Tier 2 vendors like Quill, Uline, Grainger, Gemplers, Home Depot, and Sam’s Club. Once you have a few of these net 30 accounts reporting you can then move on to securing 0% APR business credit cards and business loans from alternative lenders.
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Pay Early
Nothing will help your D&B ratings improve more than making sure your bills are paid long before they’re due. PAYDEX transaction scores are solely calculated by how fast you pay your invoices. To reach scores of 85, 90, and 100 you must pay your bills, 10, 20, and 30 days before they are due.
A score above 80 will show potential vendors, lenders, and trade suppliers that your business never makes late payments, while scores in the 90 to 100 range show that you’re willing to pay quickly too.
Pay On-Time
As long as you pay your invoices on time, every time, you should receive a PAYDEX score of 80 or more. If you pay bills before they are due, you can earn a score of 81 to 100.
Once invoices are overdue, however, your transaction score will continue decreasing every single day they go unpaid.
Large Invoices
The individual score you receive for each payment experience reported to Dun and Bradstreet gets dollar-weighted when merged into your total PAYDEX score. This means early/late payments on larger transactions carry more positive/negative weight than payment experiences for small purchases.
To quickly repair or increase your PAYDEX score, create an invoice that would make up a large percentage of your total payment transactions over the last two years, and then pay this bill 25-30 days before it is due.
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Over 90% of net 30 vendors will not report positive payment experiences to the major credit bureaus. In fact, many suppliers will only take the time to add to your D&B credit report when you make late payments or your account is in arrears.
You do, however, have a few options to get non-reporting vendors to add transactions to your Dun & Bradstreet credit report.
- Call the credit department of each vendor or supplier and ask them to report your payments to D&B.
- Manually file vendor purchase history through self-reporting services found in Nav Business Boost accounts ($40/mo).
- Subscribe to the CreditBuilder Premium program at DNB ($199/mo) and have them call each of your vendors to manually verify your payment experiences.
Manually verification inquiries require vendor input, so be sure to contact each one before manually submitting trade references through Nav or CreditBuilder. As long as they know, that Dun & Bradstreet will be calling, they’ll be a lot more likely an answer and share their payment experience data.
Extend Terms
If you find yourself not being able to pay invoices early, or are risking making late payments, try contacting your vendor’s credit department to see if they will offer extended terms.
By changing your billing from net 30 to net 60 terms, you’ll receive a 30-day grace period to attain a 100 PAYDEX transaction score, along with 30 more days to obtain a score of 80 to 100.
Active Tradelines
Just because you’ve created a few net 30 accounts, does not mean they will get monthly Dun & Bradstreet reporting. To keep generating a PAYDEX score, you must have at least three active tradelines open with suppliers and vendors with whom you do regular business.
Having no PAYDEX score can be equally damaging for your company’s credit history, and require a similar level of repair as having a low credit score.
Credit Monitoring
When building or repairing your Dun & Bradstreet credit profile getting immediate feedback on changes in your PAYDEX scores and D&B rating is a must. By actively monitoring your business credit reports, you can take fast action to dispute errors, and focus your credit-building efforts on vendors relationships that have the greatest impact on your credit scores.
While there are many credit monitoring services available, we only highly recommend one of them. By subscribing to Nav Business Boost ($40 per month) you can easily monitor and get alerted to changes in your Dun & Bradstreet business credit report. Also included in your monthly subscription at Nav:
- The ability to manually submit trade references to D&B
- Easy access to Experian Business, and Equifax Business credit reports
- Easy access to your Transunion and Experian personal credit reports
- $1M in identity theft protection, plus lost wallet replacement insurance
Credit Utilization
While historical payments provide the data for performance-based ratings like PAYDEX scores, your predictive D&B ratings are heavily influenced by your credit-to-debt ratio.
When businesses overextend their credit and start experiencing increasing amounts of debt, it’s a signal that financial troubles may soon impair their ability to pay monthly bills. By ensuring your business credit utilization is less than 50%, and optimally, below 25%, you start to increase your predictive ratings and perceived creditworthiness.
Financial Data
A complete business profile with verifiable financial data is required to obtain the highest predictive ratings at Dun & Bradstreet. When applying for a D-U-N-S number, be sure to add as many financial statements as possible, along with your number of employees.
The more detailed the company information and financial data you supply, the more accurate your predictive ratings will be.
Profile Updates
Once your D&B credit profile is set up, you should then make sure it is consistently maintained and updated. Any positive changes in your business financials, locations, or employee numbers should be immediately added. If your business phone number or address changes you must also let Dun & Bradstreet know.
Updating your credit profile at Dun & Bradstreet is free of charge and can be easily added via their company iUpdate online system. The more accurate your credit profile and the details you disclose, the more likely you are to receive higher D&B ratings.
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