How to Credit Check a Company & the importance of doing so

Company credit checks are an essential part of business. Many companies may overlook this process, but in doing so you may face complications in the future. 

A company credit check can highlight certain aspects of a business you may wish to work with. Having this information can help guide your decisions on how to continue moving forwards. 

Business information is public knowledge. As such you may be able to find the information online if you put in the time and effort. However, this can be costly for some people so the decision to instruct a credit check company is a more convenient alternative. A credit check agency will be able to pull all of the information you require and provide it in a full report for you to easily review and assess. 

Why would you need to credit check a company?

Due to the vast amount of information you can glean from a company credit check, it can help guide your decisions when choosing to work with a company. 

A company credit check can provide you with the reassurance you need to continue to offer your services. Especially in circumstances where businesses place orders on credit. Knowing that a company has the means and legitimacy to pay the finance is essential.

What are the benefits of doing a company credit check?

There are many benefits to performing a company credit check. Either spending the time yourself or instructing a credit check agency to provide a full report. 

Protect your cash flow

As a business owner you need to protect your cash flow. This is essential as you also have your own bills and expenses to pay.

Working with a business who cannot prove they are financially sound can put your own business in jeopardy. As a business owner, you want to avoid as many risks as possible and protect your cash flow. 

Alert fraud 

Another benefit of a company credit check is that it can alert you to any fraudulent businesses. 

As a business owner, you want to work with good, honest businesses. Having a fraudulent company working with you can be detrimental to your own business. This is something you need to avoid.

Best business practice

Knowledge is power. As such it is always best business practice to perform company credit checks when working with a new business. 

Keeping your team in this good habit will protect your business from any potential risks and cash flow problems. 

3 tips to credit check a company

As a business, it can be daunting when you begin implementing company credit checks. However, they are necessary and your clients should understand. Follow our three essential tips below for successful implementation of company credit checks.

Be open about your criteria

Honesty is always the best policy in business and in life. Be open about the criteria you have set from the get go. This will make it easier for your prospective client to assess whether they are a good fit for your business. 

Honesty builds trust. It’s an essential part of business to trust your clients and for them to trust you. Starting off on the right foot builds that level of trust needed for a good working relationship.

Do a credit check before any contracts are signed 

Don’t leave the credit check to the last minute as this not only messes you around but also your potential client. Get the credit check in as early as possible, that way you can prepare for all avenues.

Talk about alternatives if a credit check isn’t possible

In some cases, a company credit check doesn’t come back as you expected. Assuming the report is clean and there are no signs of fraud, you may feel comfortable to offer alternative solutions. 

Some businesses might also not have been around long enough for a complete credit report. Being honest and open about your requirements could lead to alternative checks such as bank references or other supplier references. 

Protecting your business is the first and most important step to ensuring you remain in the black. Working with a debt recovery agency may be needed in the future. Here at My Debt Recovery, we work with you and your clients to find the best possible solution. Contact our team of experts now for more information on how we can support you. 


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