BUILD YOUR BUSINESS CREDIT EASILY, QUICKLY, AND WITH LITTLE EFFORT WITH

OUR SMART START BUSINESS CREDIT BUILDER

Dear Business Credit Builder,

With this process you can Establish business credit for your EIN without using your personal
credit! I can help you to build your business credit easily through our itemized, personalized
and streamlined process. This resource guide and checklist serve as an invaluable tool in
helping small business owners and entrepreneurs obtain business credit without using their
personal credit or Social Security Number. The first step is to smart start building your
business credit today!

WHAT IS BUSINESS CREDIT?

In simple terms, business credit is credit in your business’ name and linked to its EIN and not
the business owner(s) social security number(s). With an established credit profile, on-time
payment history and score, the business will qualify for additional credit and funding from the
business creditor and financial institutions. More importantly, since the business qualifies for
the credit, in some cases there is no personal guarantee (PG) or credit check required from
the business owner(s).

WHO CAN BENEFIT FROM BUSINESS CREDIT?

Business credit is ideal for entrepreneurs, small business owners, and nonprofit leaders just
launching their business, as well as, established businesses and organizations. It can be vital
for companies that do not have collateral required by the Small Business Administration loans.
It’s also perfect for businesses with very little cash flow to verify, no tax returns, or don’t want to
verify business information.

WHY SHOULD I BUILD BUSINESS CREDIT?

There are many advantages to building business credit that is not connected to your SSN.
First, your business can establish a credit profile that is completely separate from the business
owner’s consumer credit profile. This gives business owners DOUBLE the borrowing power as
they have both consumer and business credit profiles established.

Most creditors and vendors will check your business credit report before making critical
decisions about your business. That evaluation criterion is based heavily on the applicant’s
business credit score. Your ability to establish a sound credit profile and score will allow
business credit grantors to evaluate the creditworthiness to determine whether or not to issue
credit. The more established the business credit profile, the more options the business will
have to obtain credit, loans, and leases without the use of personal guarantees. It is not easy to
do this, but yet it is not impossible.

By not having an established business credit profile and score will get an owner DECLINED
for credit and financing. Please be advised that there are no federal regulations that require
the lenders notify the business owner for their reason for denial, so most never know.

When your business credit and profile is established correctly, it can be built without a personal
credit check. Business credit can quickly be obtained regardless of personal credit quality.
Additionally, most business credit can be obtained without the owner taking on personal
liability or a personal guarantee. This means in case of default, the business owner’s personal
assets cannot be pursued.

Your business can use its established credit profile and scores to qualify for revolving store
credit cards like Amazon, Staples, Lowes, Sam’s Club, Costco, BP, Wal-Mart, even
MasterCard, Visa, and American Express. In addition, your business could also qualify for credit
lines and loans.

WHO ARE THE BUSINESS CREDIT REPORTING AGENCIES?

Business Credit reports are offered by Experian, Dun & Bradstreet, and Equifax. These
business credit bureaus allow your business to establish its own credit profile, scores, and
payment history. As a business owner, you should know who the major business credit
reporting agencies are and what type of data they collect on your business. Knowing this will
give you greater insight into getting listed and established in the business credit industry. You
will first want to get a copy of your business credit reports to see what is being reported
before you start your business credit building.
Here are three Business Credit Bureaus you should know:

1. Dun and Bradstreet (D&B): D&B is the primary business credit reporting agency with over
70 million businesses registered in their database. A business credit file with D&B contains
information provided by the business owner and vendors of the business. D&B issues a
Paydex score based on payment experiences and a DUNS rating based on financials. D&B
has a business credit builder program that is one way for business owners to add trade
references to their file in a short period of time. Dun & Bradstreet offer a Credit Monitor product
where you can get unlimited access to your D&B reports and scores for $49.00 monthly.

Don’t want to purchase one of Dun & Bradstreet’s trade reference programs? Getting a
credit account with large retailers, office, logistics and energy companies will help you build
your business credit. Many companies including UPS, FedEx, Office Depot, Home Depot,
Staples and Exxon Mobil report their credit accounts to the credit bureaus. Getting a
business credit account with these companies will help you build credit faster.

2. Equifax Small Business Enterprise: Small Business Equifax, one of the three primary
consumer credit reporting agencies, also provides business credit evaluations for over
22,000,000 small businesses and corporations. It typically takes more time to create a file with
Equifax Small Business than D&B and Experian. Unfortunately, many vendors and creditors
do not report to Equifax. Most of them report to Experian or D&B. It is important to apply with
the credit providers who report to Equifax when you find them. You can get setup for Equifax
credit monitoring for as little as $19.95 monthly.

3. Experian Smart Business Reports™: Experian business is another one of the three
primary consumer credit reporting agencies who provide business credit evaluations as well.
Smart Business Reports assigns a business credit score called the Intelliscore.

WHAT IS A BUSINESS CREDIT SCORE?

The two most popular business credit scores come from the two credit bureaus most
renowned for their business reporting. Despite offering business credit reports, Equifax does
not market business credit scores.
Experian: Ranges from 0 (high-risk) to 100 (low-risk)

Dun & Bradstreet: D&B offers six different types of business credit scores:

PAYDEX Delinquency Predictor Score Financial Stress Score Supplier Evaluation

Risk Rating Credit Limit Recommendation D&B Rating
HOW ARE BUSINESS CREDIT SCORE DETERMINED?

Business credit scores are based only on whether the business pays its bills before-time or
ontime. A business owner can obtain credit much faster using their business credit profile,
unlike with consumer credit. Per the Small Business Administration, credit approvals and
limits on business credit cards are usually 10 to 100 times higher than the approvals and limits
consumer credit cards. This is another great advantage of establishing business credit.

A business will need a PAYDEX score of 80 to obtain the most favorable financing. This score
simply reflects the business pay all bills on time. To obtain a PAYDEX score, a business will need
at least five trade accounts reporting to their file. Business Credit Score Breakdown:

*100 Score: Indicates payments made early. *90 Score: Indicates payments are made on the
due date. *80 Score: Indicates payments comes within an early discount period after due date.
70 Score: Indicates payments come 14 days beyond terms.

60 Score: Indicates payments come 21 days beyond terms 50 Score: Indicates payments
come 30 days beyond terms. 40 Score: Indicates payments come 60 days beyond terms. 30
Score: Indicates payments come 90 days beyond terms. 20 Score: Indicates payments come
120 days beyond terms. UN: Indicates payment data is unavailable.

When operating on trade credit with vendors, always try to pay before the due date. This
greatly helps especially if your vendor is reporting your payment performance. Early payments
will improve your business credit score. Most business accounts have net 30 terms, for
example, meaning you have 30 days to pay your invoice after receiving it. If you can, try to pay
it within the first 10-15 days. Your business credit always improves with early payments. It can
take as long as 90 days for those trades to report and a score to be established.
SO, HOW DO I GET STARTED?

This checklist serves as a tool in helping small businesses and entrepreneurs obtain business
credit without using their personal credit. The first step in establishing business credit is to
make sure your business is a legal entity and in compliance. PHASE I: BUSINESS
COMPLIANCE AND CREDIBILITY

STEP 1 CHOOSE A NAME FOR THE BUSINESS: A name should reflect the mission of
the corporation, but it will also need to comply with applicable laws. A name must: (1) Not
conflict with the name of another business; (2) Not infringe on a trademark; (3) Not use certain
words that imply an affiliation (“bank,” “federal,” or “insurance”); (4) If required by the state, use
words like “Corporation,” “Company,” “Inc.,” or “Incorporated” to describe its business structure.
You can determine the availability of a name by searching the prospective name at Secretary
of State’s Office website for your state.

STEP2 GET A VIRTUAL OFFICE ADDRESS: A virtual office address provides

communication and address services for a fee, without providing dedicated office space.

STEP 3 GET YOUR BUSINESS 800 # & GET LISTED WITH 411 DIRECTORY: You must
have a dedicated business phone number that is listed with 411 directory assistance, under the
business name. Lenders, vendors, creditors, and even insurance providers will verify that your
business is listed with 411. A tollfree number will give your business credibility, but you must
have a LOCAL business number for the listing with 411 directory assistance.
STEP 4 DRAFT THE BUSINESS’S ARTICLES OF INCORPORATION: For businesses that
want to incorporate, requirements for forming and operating a corporation are governed by
state law. FILE THE BUSINESS’S ARTICLES OF INCORPORATION: Incorporate your
business or form your LLC with the state.

Forming a business as a corporation or LLC helps to protect the owners’ personal assets from
the debts and liabilities of the business. There are also other advantages to forming a
corporation or LLC, including certain tax advantages and establishing credibility for your new
business with potential customers, vendor, employees, and partners.

Starter vendors will do the check for your corporate status with the Secretary of State’s office
in the state of incorporation. If a vendor cannot find your corporation or LLC on file, or if your
status is INACTIVE or DISSOLVED, or if the address that you gave Dun & Bradstreet, and that
you put on the application does not match the Secretary of State's information, you will get
DENIED. After being denied, you may be asked to provide additional documentation regarding
your corporation, such as your articles of incorporation, a copy of your lease or phone bill
showing the company name.

STEP 5 OBTAIN EMPLOYER IDENTIFICATION NUMBER FROM IRS: Employer

Identification Numbers are issued for the purpose of tax administration. No need to file a Form
SS-4. IRS.gov online application asks you the questions and you give them the answers.
After all validations are done you will get your EIN immediately upon completion. You can
then download, save, and print your EIN confirmation notice.

STEP 6 EXECUTIVE OFFICERS MEET TO DRAFT A CORPORATE RESOLUTION TO

OPEN A BANK ACCOUNT: Officers will meet to decide on a financial institution for the
business’s financial accounts. Most of the banks prescribe their own formats for the
corporate resolution required for opening accounts.

STEP 7 ESTABLISH THE BUSINESS BANK ACCOUNT: It is important to establish a prudent

system of checks and balances when dealing with the finances of a business. It is advisable to
allocate finance work among several people so that no one person is in charge of handling all
of the transactions related to money. For example, when dealing with the receipt of cash, there
should be one staff member who receives and tallies the funds, but a different staff member
who then is responsible for taking the money to the bank and making the deposit. You should
arrange for bank statements to be sent directly to the executive board, in order to ensure that
each transaction can be accounted for. In turn, the bank statements then can be forwarded to
the staff member responsible for reconciling the account(s). By proceeding in such a prudent
fashion, the potential for misappropriation of funds is minimized. Such sound fiscal procedures
will please auditors, as well as future investors.
ESTABLISH AND MAINTAIN A GOOD BANK RATING AND CASH FLOW: The key to
establishing bank credit is to maintain a healthy balance rating. This rating is your average
minimum balance maintained in your business bank account over 3 months. For example, say
a $10,000 balance rates as “Low 5”, $5,000 rates as “Mid 4”, $999 rates as “High 3”, and so on.
Unfortunately, without a satisfactory balance rating, many banks will assume your business
might not have the ability to repay a line of credit or a loan.

The cash coming in and going out of your business bank account should reflect a positive free
cash flow. Positive free cash flow is the amount of revenue left over after your business has
paid all its expenses. When your account shows a positive cash flow it indicates that your
business is generating more revenues than is used to run the business. It is important to also
recognize that banks are motivated to lend to a business that has consistent deposits.

STEP 8 SECURE DOMAIN NAME, WEBSITE, AND USERNAMES ON SOCIAL MEDIA

ACCOUNTS: Choose a domain name that is unique, not just in your city or state, but in the
world. Your domain name is the online real estate for your new business. This is where your
business will live online and be found. Try to find a domain name that is close to your business
name. It is good practice to use the entire company name. The success of your business can
rise or fall on the ability of clients or customers to find your business on the internet. Be sure to
secure accounts on popular social media sites, such as Facebook, LinkedIn, Instagram,
Twitter, etc.

If customers and clients like you and your company, they’ll want to interact with your
company online. GET A DEDICATED BUSINESS EMAIL ADDRESS: It is important to get a
company email address for your business ([email protected]). It’s not only
professional but greatly helps your chances of getting the thumbs up from a credit provider.
Setting up a business email address is just too easy and inexpensive to neglect.

STEP 9 OBTAIN THE NECESSARY BUSINESS LICENSES AND/OR PERMITS. Most

businesses need licenses in order to begin operations. Licenses may be required for your city,
your municipality, your county and/or your state. It is best to contact both your Secretary of
State to check on business license requirements for your particular type of business and
industry and to contact your local government agency in charge of licensing to learn about
their requirements and how to obtain the necessary licenses.

STEP 10 APPLY FOR A D-U-N-S NUMBER. Dun and Bradstreet (also referred to as D&B) is
one of the major credit bureaus for business credit. You need to have a file established with
them in order to establish a credit score by going to the website: http://www.dnb.com. Once
you have a file (also called a profile) established with D&B, you will receive a number called a
D-U-N-S number. This is the number that Dun and Bradstreet used internally to track your
business credit. You will establish your D&B profile and request a DUNS number. This is
something that you will need to do yourself or hire us to complete for you. The actual amount
of time it normally takes to request your number is about 10 minutes. You will probably spend
more educating yourself on how to do it than the time it takes to actually complete the profile.

PHASE II: ESTABLISH BUSINESS CREDIT PROFILE & VENDOR CREDIT

APPLY FOR NET 15/30/60/90 ACCOUNTS WITH VENDORS.

A business credit report can be started much the same as a consumer report commonly is,
with small credit accounts and/or cards. These types of initial cards in the business world are
commonly referred to as “vendor credit.” You must start a business credit profile and score with
starter vendors. A vendor line of credit is when a company (vendor) extends a line of credit to
your business on “Net 15, 30, 60 or 90” day terms. This means that you can purchase their
products or services up to a maximum dollar amount and you have 15/30/60/90 days to pay
the bill in full. So if you’re set-up on Net 30 terms and were to purchase $300.00 worth of
goods today, then that $300.00 is due within the next 15/30/60/90 days. Some vendors require
an initial prepaid order before they can approve your business for terms. Your vendors do not
necessarily have to serve 100% of your business needs.

When your first Net 30 account reports your “trade line” to Dun & Bradstreet, the DUNS system will
automatically activate your file, if it isn’t already. This is also true for Experian and Equifax. You
need to have a total of at least five (5) Net 30 day pay accounts reporting. Be advised that
you must spend a minimum of $50.00 in order to have your accounts and payments report to
the bureaus.

PHASE III: PROCURE STORE REVOLVING BUSINESS CREDIT CARDS

APPLY FOR STORE CREDIT CARDS. After five (5) trade lines are established using vendor
accounts, obtaining revolving accounts is the next step in building business credit. Revolving
accounts are cards a business owner can use and not be required to pay the full balance owed
each month. Revolving account approvals will begin coming from stores. Major retailers
including Dell, Walmart, Target, Best Buy, Amazon, Sam’s Club, Costco, Staples, Office Depot,
Lowes, Home Depot, BP, Chevron, and most other retailers all offer business credit. Most of
these retailers will approve you for new credit once you have a credit profile established, have a
good business credit score that results from you paying your bills as agreed, and once you
have five (5) payment experiences or more established on your business credit profile.

Store revolving credit must be obtained before the business owner starts getting cash
credit cards such as Visa, MasterCard, and/or American Express. If your EIN credit is not
good enough, you might be declined and they then might ask for your SSN. No matter what
ANY credit representative tells you, credit CAN be obtained based on your EIN only.

PHASE IV: PROCURE HIGH-LIMIT REVOLVING BUSINESS CREDIT CARDS

APPLY FOR REVOLVING CASH CREDIT CARDS. Once ten (10) total accounts are on the
credit profiles, you can then start applying for Visa, MasterCard, and American Express type
credit. Approval amounts will be equivalent to the highest credit limit account on the business
report. Try to have ten (10) accounts with at least one of them having a $5,000-$10,000 high
limit. It is essential to keep using the credit, keep applying for more, and talk with credit
providers to raise credit limits. If you do this, business credit will keep growing until higher limit
credit lines are obtained, within 6-12 months.
www.creditcards.com/business.php

PHASE V: APPLY FOR ADDITIONAL BUSINESS FUNDING & CREDIT LINES

PREPARE A BUSINESS PLAN: Prepare a business plan, if you have not done so already.
Business plans define the Who, What, When, Where, and How of your business and the
products and/or services you plan to provide. Business plans clearly outline the goals of the
business, explain the operating procedures, detail the competition, include a marketing plan and
explain the company’s current and desired funding. If your company plans to seek funding either
in the form of a traditional loan or from venture capitalists, a thorough business plan will be
required for the application process. APPLY FOR BUSINESS LOANS: Not all small business
owners have enough of their own capital to start a business, and many seek outside funding
from sources such as banks or through Small Business Administration (SBA) loan programs.