Do businesses actually have a credit score? The short answer is — yes. And, these measures of financial responsibility are calculated much in the same way individual credit worthiness is determined. Although it’s not something that’s widely discussed or known about in the consumer world, businesses do have credit histories, and therefore detailed reports which give them scores. Read on to learn the basics about business credit scores and what you need to know. How Business Credit Scores are Calculated As mentioned above, a business credit score is measured very similar to the way individual scores are calculated. Meaning, the length of credit history, types of credit used, payment history, debts owed, and other factors. Unsurprisingly, the better a business handles its financials, the better score it earns. Businesses of all sizes may need credit. A carpenter with no employees may want to borrow money to buy equipment. A marketing professional with a few employees may be ready to purchase furniture and computers for a new office. A salon owner with subcontractors but no employees may want to buy, rather than rent, commercial property. Any type of business could benefit from a business credit card. —US News and World Report Of course, there are some differences, one of the most minor being the scores themselves. While individual credit scores range from a low of 300 to a high of 850, business scores range from 0 to 100, with 100 being the highest. Additionally, business credit scoring services use different models in order to determine the creditworthiness of companies. Also, instead of there being three main credit reporting bureaus for individuals, Equifax, Experian, and TransUnion, there are two principal business credit scoring entities: Dun & Bradstreet and Experian. How to Improve a Business’ Credit Score Since business credit scores rely on many of the same elements as individual consumers, nearly the same factors are used to assign a credit worthiness score. So, in order to maintain or improve a business’s credit score, companies must do the following: Keep debts manageable. Opening too many accounts and taking on large amounts of debt will only increase your financial risk. This not only hurts your business’s credit worthiness, it also puts a lot of strain on you as the owner. This is why it’s best to keep your credit accounts to a minimum and pay off as much debt as possible. Utilize different types of credit. Credit mix is also a consideration, meaning businesses having different types of credit accounts. While it’s advantageous to have various types of credit, it is equally advantageous to keep these to a minimum so you’re able to pay what’s owed in a timely manner. For instance, you might finance or lease vehicles through your business, have a business credit card, and maintain vendor credit accounts. All of these will go into determining your business’s creditworthiness. Be vigilant with your personal credit. One misnomer that entrepreneurs have about business credit is that it’s somehow separate from their personal credit and/or financial responsibilities. However, this is completely false. Business credit accounts almost always require an individual or personal guarantee. This of course means that if the business defaults on a line of credit, you are personally responsible for that particular debt. Moreover, business credit is partially scored on your personal credit, so it’s best to maintain a good personal score for the benefit of your company’s creditworthiness. What other suggestions do you have about maintaining a business’ credit score? Please take a moment to share your thoughts and experiences so others can benefit from your perspective! Interested in learning more about business? Then just visit Waters Business Consulting Group.

When it comes to the workplace, trust is key. Employees need to trust their managers in order to feel comfortable taking risks and be productive. Managers, in turn, need to trust their employees in order to delegate tasks and give them the freedom to make decisions. Unfortunately, many managers say things that damage this trust relationship. So, let’s discuss five of the most common phrases that managers use that kill employees’ trust. Words can Speak Louder than Actions Managers should avoid the following phrases in order to maintain a trusting relationship with their employees. Trust is essential for a healthy workplace and these phrases can damage that trust relationship. Employees need to feel comfortable coming to their managers with questions and concerns, and they need to know that their manager will be open and transparent with them. The employee-manager relationship is one of the primary components to a strong organizational structure. Employees rely on their managers for career development and guidance on how to improve their skills. One of the elements of a successful employee-manager relationship is trust. When the sense of trust is strong between an employee and manager, it adds efficiency to other elements of workplace productivity. —Houston Chronicle Small Business When managers use these phrases, it sends the opposite message. It makes employees feel unimportant and disregarded. It creates uncertainty and frustration, which leads to a lack of trust on the part of the employees. And that, of course, results in a negative impact on morale, productivity, and overall company culture — three poison pills that can cause actual, long-lasting damage. Five Phrases Managers should Avoid to Avoid Destroying Employee Trust We’ve all heard the age-old wisdom about sticks and stones breaking bones but words never inflicting harm. Of course, this philosophy is entirely contextual because we all vividly remember instances when words cut deep. While these phrases aren’t intended to insult or hurt, they nevertheless undermine your authority, respect, and relatability. So, avoid using the following phrases because they will slowly kill employee’s trust: “I’m the boss, I don’t have to explain my decisions.” This phrase is incredibly damaging to trust. Employees need to feel like they can come to their managers with questions and that their manager will be open and transparent with them. When a manager uses this phrase, it sends the message that the employee is not valued and that their opinion does not matter. It also makes the manager seem like they are hiding something. This can lead to employees feeling uncomfortable coming to their managers with questions or suggestions, which can hurt productivity and morale. “I’m too busy to deal with this right now.” This phrase often comes across as dismissive and unprofessional. It sends the message that the employee’s concerns are not a priority and that their manager is too busy to deal with them. This can make employees feel unimportant and disregarded. It can also lead to them feeling like they are not able to come to their manager with problems or concerns, which can hurt morale and productivity. “I’ll get back to you.” This phrase often comes across as ambiguous and frustrating for employees. Employees want to know what is going on and they want answers from their managers. When a manager says this phrase, it sends the message that the employee is being ignored and that their question is not important. It also creates uncertainty, which can lead to employees feeling anxious and stressed. “I’m not sure, let me check on that.” This phrase is often used as a way to avoid making a decision or taking responsibility. It sends the message that the manager is not capable of making decisions and that they are not in charge. This can make employees feel like they are not being taken seriously and that their concerns are not important. It can also lead to frustration and a lack of trust on the part of the employees. “That’s not my job.” This phrase communicates that the manager does not care about their employees or their job responsibilities. It sends the message that the employee is unimportant and that their job is irrelevant. This can lead to employees feeling unvalued and unmotivated. It can also cause them to feel like they are not able to come to their manager with questions or concerns, which can hurt morale and productivity. Which other phrases would you include in this list? Please take a moment to share your thoughts and experiences so others can benefit from your perspective! Interested in learning more about business? Then just visit Waters Business Consulting Group.