Company Credit Check
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Our best online company credit check tool is totally free. It doesn’t cost you anything which means you can perform as many searches as you like.
Make faster decisions with reliable, actionable real-time insights on companies by leveraging millions of data points and signals.
Our company credit check software offers you a deep, thorough check with verified data for greater accuracy. With AI powered data extraction, processing, and company identification algorithms, checking company credit has never been easier.
With the business world moving faster than ever, our commercial credit data is continuously updated with millions of data points and signals across the deep web and our business credit network.
Why you should perform commercial credit check on other companies
It might be tempting for a small business to decide not to run credit checks on companies they work with in short-term or long-term. After all, doing so may seem like another obligation in an already long-list of tasks that are associated with running a business.
However, small businesses should perform credit checks when establishing relationships with new companies. Checking off a number of these risks is important in growing your company.
Helps the business anticipate the level of risk they are undertaking
Identifies potential red flags in other businesses’ histories
Enables you to evaluate the likelihood of receiving timely payments
Get a sense of the scope and longevity of other organizations
Consequences of not performing company credit check
Customer credit check
Number of customers and businesses taking part in commercial and trade operations is continuously on the rise and no organization in the market can rely on cash transactions alone. In order to grow and expand in the global market, a significant portion of revenues is generated from credit sales. Below are some of the key risks which a business might face if it does not perform credit checks of its customers:
- If a firm does not perform checks on credits of its new customers, it is highly likely that it is increasing its chances of exposure to cash flow and non-payment risks.
- Another key risk in this regard is that these new customers might not be able to payback their obligations on time as they are not strong in terms of their financial position and performance. This means that financial resources of issuer are more exposed to depletion and issuer firm might face significant hurdles in future and this might have a negative impact on growth and expansion of issuer firm in the future. Due to late payments from customers, issue will have to raise funds from debts to finance its operations and this will increase interest cost of issuer.
- Financial prudence is the key to success of a firm in the long run and in order to maintain prudence at a required level, it is mandatory that leadership does not let sales overrule financial prudence in order to avoid turbulences in future.
- In the absence of a credit check, it will be almost impossible for sales and marketing teams to determine long term ability of customers to do business with the issuer firm. Performing a credit check can save time and resources of issuer firm.
Supplier credit check
Supply chain is absolutely critical for companies that produce products. Unexpected disruptions to supply chains can be devastating. One way that businesses can reduce the likelihood of experiencing supply chain problems is by performing credit checks on suppliers. Failing to do so risks having a supplier unexpectedly go under or experience issues that can send you scrambling to find a replacement supplier with little notice.
However, if a supplier is experiencing financial problems, it will likely show up in a credit report. Additionally, the major credit reporting companies provide estimates of the likelihood that a business will continue to exist over a certain period of time, a metric that is of critical importance when evaluating suppliers. Credit reports also show bankruptcies, liens, and other relevant issues that a supplier has experienced.
Partner credit check
Businesses gain or lose credibility based on many factors including companies they have relationships with. Thus, running a credit check on a prospective partner can help an organization to better vet the business they are considering forming a relationship with. Failing to run a credit check can cause business to miss important information such as existing legal actions against the potential partner that may want to be considered when exploring a relationship.
In terms of partners, it is also important for your bottom line. Credit checks provide vital information including the payment history and trends of businesses. No business likes to accumulate unpaid invoices. However, failing to run credit checks can allow companies to miss evidence that a perspective partner may consistently be late on payments or have a significant amount of debt.
Investor credit check
Checking the credit of investors may seem like an odd thing to do. After all, if someone is wanting to provide your business funding, what is the problem? The reality is that if you are considering selling a share of ownership in your business to another entity, you will want to have a thorough understanding of that organization.
When you run a credit check, you will be able to gain valuable information such as how long the organization has been in existence, its legal history, its relative financial strength, and a number of other metrics that help evaluate the decision. It will also provide the company’s lineage, which illustrates other organizations it owns a stake in as well as its parent company if there is one. Without checking an investor’s credit, you run the list of going into a relationship relatively blind, which can result in a greater likelihood of conflicts going forward.
Key factors for consideration in evaluating company credit checks
When looking at commercial credit reports, there are a number of factors that you will want to consider.
First, the basic summary information about a company provides important information such as the number of years the company has been in business. Obviously, a company that has been around for a longer time has a higher level of credibility and stability.
It is important to carefully review financial information including assets and liabilities. Furthermore, credit reports typically have metrics that predict the level of risk involved in a company or its relatively level of stability.
Company operating history
Payment history shows the percentage of payments made on time, the amount of credit a company has, and the amount of credit it is currently using.
Company legal filings
Finally, businesses will want to briefly review the legal history which includes judgments against companies, bankruptcies, and liens. This section of the report also provides information on UCC filings, indicating that a company’s assets are being used as collateral.