5 ways to improve your Dun & Bradstreet business credit report

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5 ways to improve your Dun & Bradstreet business credit report

Published By Janet Gershen-Siegel at September 23, 2017

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Your D & B Report (also known as your (Dun & Bradstreet Report) is one of the first things a company will check when determining whether to do so business with you at all. Dun & Bradstreet offersthese reports to their customers to help them determine if a potential supplier, vendor, or business partner, constitutes a good credit risk. A company will depend on the D & B Report about your firm to make informed business credit decisions and avoid bad debt.

Dun & Bradstreet takes numerous factors into account in producing such a report, and you can improve some of these factors and thereby improve your report.

1. Delinquency Predictor

To estimate out how likely your company is to be late in paying your financial obligations, Dun & Bradstreet takes historical information to try to predict future outcomes. D & B identifies the risks inherent in a future decision, by comparing historical information to a future event.

You can improve this measure by paying your company’s bills on time.

2. Financial Stress Score Percentile

If D & B identifies your company as financially stressed that means you have ceased operations following assignment of bankruptcy; or voluntarily withdrawn from business operation with unsettled obligations; or closed up shop with a loss to creditors; or your company is in receivership or reorganization; or you have made some sort of a plan for the benefit of your creditors.

It may sound easier said than done, but probably the best way to improve this particular aspect is to avoid receivership. Good financial responsibility helps the most here.

3. Financial Stress Risk Class

D & B scores your company with respect to businesses least likely or most likely to fail. Therefore a D & B customer can quickly separate their new and existing accounts by risk and then decide how to proceed. If your business is shown as being Discontinued at This Location; Higher Risk; or Open Bankruptcy, you will automatically get a 0 score.

To improve this score, make sure you update your location if you move, and make an effort to not declare bankruptcy. If your business is high risk, you cannot do anything about that, however.

4. Composite Credit Appraisal

This number, between 1 through 4, makes up the second half of your firm’s rating. It shows Dun & Bradstreet’s overall rating of your business’s creditworthiness. They analyze company payments, financial details, public records, business age, and other points.

If your company does not supply current financial information, you cannot get a Composite Credit Appraisal rating above a 2. In general, when Dun & Bradstreet does not have all of the information they need, they will show that in their reports. However, omitted information does not necessarily mean your firm is a poor credit risk.

Improve this score by providing as much pertinent information as possible.

5. PAYDEX Score

A PAYDEX Score is Dun & Bradstreet’s dollar-weighted mathematical rating of how your company has paid the bills over the past year. D & B bases this score on trade experiences reported by various vendors.

Improve this score by maintaining good relationships with your vendors and making sure they report to D & B.

To guarantee as accurate a report as possible, it quite literally pays to provide D & B with your company’s current financial statements.

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