By Mike Enright
Establishing business credit is an important step for any new small business and helps you to: (1) maintain a credit history separate from your personal credit history and experience the business benefits of having good business credit, and (2) demonstrate separation between owners and the business.
Why separate credit histories?
By having a business credit history separate from your personal one, you can minimize the effect negative events one might have on the other. For example, if you have some financial missteps that impact your personal credit history and score, they shouldn’t impact your small business credit if you have established a clear separation and vice versa.
Why separate business and owners?
Unless you’re operating your small business as a sole proprietorship or general partnership, you need to demonstrate that the business is separate from the owners. One of the key benefits that corporations and limited liability companies (LLCs) provide the owners is protection of their personal assets. Keep this protection in place by consistently showing clear separation between the owners and the business.
Eight steps to establishing your business credit
Benefits of having good business credit
Having good business credit can provide a number of benefits, including:
Once you have established and built good business credit, be sure to monitor and protect it, just as you do with your personal credit.
See original article at Biz Filings
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