Business Credit and Credibility

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Business credit and business credibility are different, yet intertwined business drivers that have become increasingly important for small business’ ability to expand and gain new customers.

Business credit and business credibility are mutually inclusive, having direct impact on each other and your company’s reputation in the marketplace. The goal of each function is to elevate your company’s market status, and should be implemented and managed together to build superior trust-based relationships with all stakeholders including lenders, suppliers, vendors and customers, who can ultimately affect your business’ standing in the marketplace.

What is Business Credit?

Establishing business credit and managing your credit profile assures that the market obtains an accurate representation of your company’s ability to employ and manage cash flow. Qualifying for a small business loan or other traditional sources of business financing can be a difficult task, especially if you haven’t established business credit and the business credit scores well in advance of the need for capital. Even in the best of times, some small businesses fail because owners have an incomplete knowledge of how to manage their cash flows appropriately and/or how to access the financing they desire to cover their working capital needs. A well-managed business credit report and superior business credit scores means less reliance on personal credit, which gives small business owners a vital edge when attempting to secure a business loan and trade credit, and limits personal liability.

A business owners’ personal credit does little to make vendors comfortable about their firm’s ability and intention to pay business obligations. In order to attract the top vendors and obtain the best terms, owners must demonstrate a high-quality trade history and superior business credit scores, such as a D&B PAYDEX® Score and Commercial Credit Score, to present a well-rounded business credit profile.

What is Business Credibility?

Business credibility has become vital in an era when even a single online review or negative customer complaint can threaten new sales and existing relationships. To establish and maintain credibility, businesses should find new methods and expend greater resources to build trust with all stakeholders.

Communicating with external stakeholders to build business credibility requires most businesses to build an expansive online presence. Using the Internet to build credibility requires more than creating a top-quality website. Here are the top four ways to build long-lasting business credibility:

  1. Let visitors get to know you
  2. Starts with the bare minimum—publish what you do, what you sell and your full business address (not a P.O. Box), including your phone number and other ways to contact you. Also, provide information about your business history and key company individuals; this will increase the air of legitimacy surrounding your business.

    Visitors thinking of doing business with your company will be more comfortable when they know who they are dealing with and that they can contact you anytime they want.

  3. Be consistent and transparent
  4. Make sure that everything that is communicated or created for public consumption is done in a consistent manner. All products or services should meet the standards that you promote, and consistently meet or beat customer value expectations. A trustworthy organization is one that is stable and does all its’ business dealings above board, because it has nothing to hide from the marketplace. 

  5. Create a strong and diversified online presence
  6. Developing and maintaining a strong online presence through a company website is fundamental and supporting it with other online means is crucial. By claiming and enhancing your company listings on online business directories (D&B Credibility Review, MerchantCircle, etc.) and becoming active within social media (Facebook, Twitter, etc.), you further demonstrate transparency to your stakeholders, create additional channels for customer interaction and increase your general awareness—all of which are indicators of credibility. 

  7. Display third party seals online
  8. Studies have shown that displaying reputable seals on your website can dramatically increase online visitors’ confidence in your business and make them more likely to purchase either online or offline. It can be challenging to attract new customers to your company’s website if there is a lack of confidence in your company’s legitimacy, ability to protect customer information or site security. There are a number of companies that offer solutions to increase confidence in your company’s website.

    The TRUSTe seal provides verification that your business is committed to customer data privacy; the McAfee seal provides virus protection and general Internet security; the VeriSign seal gives customers confidence that your site can be trusted for online purchases; the BBB (Better Business Bureau) seal shows that your business meets accreditation standards for making a good faith effort to resolve customer complaints, and the D&B D-U-N-S Registered Smart Seal lets customers, creditors and suppliers know that the business is credible.

Conclusion

For prospective buyers to purchase and develop into repeat buyers, they must be confident that a company is trustworthy, delivers value in their products and will continue to be a stable and economically viable entity. For this reason, building business credit and business credibility in a symbiotic fashion should be a stated business goal of a company’s overall business strategy and a generally accepted method to build confidence and trust with each of its different stakeholders.

For information on the products and services Dun & Bradstreet Credibility Corp. provides, please visit us online at DandB.com or call 1-855-444-3093 to speak with a credit advisor.