Episode 23- Business Credibility to Business Credit with Tom Bennett

In this episode of "Small Business, Big Moves,". Thomas Bennett  explores creative strategies and innovative approaches that have propelled small businesses to new heights. Discover the power of building business credibility to business credit. 

Connect with us on social media:
- Facebook: Thomas Bennett
- Instagram: @Thomas.mbennett
-YouTube:@SmallBusinessMoneyConnector
- LinkedIn: Thomas Bennett

Subscribe to "Small Business, Big Moves" on Your Favorite Podcast Platform for more inspiring episodes on innovation and entrepreneurship.

Small Business Big Moves is a podcast where innovation meets entrepreneurship. Join Tom Bennett as he explores all things  business growth! From business funding and business tax credits to conversations with leaders who have grown successful and innovative businesses! 

Transcript

0:02

Welcome to Small Business Big Moves, the podcast where innovation meets entrepreneurship. I'm your host, Tom Bennett, and we'll explore all things business growth from business funding and business tax credits to conversations with leaders who have grown successful and innovative businesses. Welcome to the show. Today's episode will be focused on an area I don't think is talked about enough, which is business credit. And we'll jump right into it. So when it comes to business credit, the first and most obvious step towards building your business credibility is selecting your business names. So obviously if you already have a business, then you can check the box on this. But if you're. Considering starting a business or looking into that, that then the first step you obviously want to do is select your business name. From there, you'll want to select and set up your business address. While it's not mandatory, a business address is always recommended. Essentially adds another layer of credibility and is something that lenders like to see. You don't want to use a P. O. box as your business address. Not only do they have some restrictions and disadvantages, some states actually won't allow you to register your LLC or corporation with a P. O. box. So that's an optional step, but it definitely helps. And then from there, you want to set up your business entity. Which is really where you build that credibility as well, whether that's going to be a corporation in your growing your own mini empire, if you're going to have an LLC, which has some serious perks with that, if you're looking for efficient taxes. Limited liability and the flexibility of a partnership. This is definitely your option. It's like having your cake and being able to eat it too. The other option is a partnership where you're sharing profits while also sharing the responsibilities. This can also be a game changer. Obviously choosing the right partner is critical. Treat it like a marriage. So it might not be till death to your part, but a messy breakup could still sink you in at least hurt at a minimum. So that's another option. And then the final option is going to be a sole proprietorship. Just like the name implies, it means you're solely responsible and liable for the business. So those are four options that you can have to set up for a business entity. So once again, that's a corporation, LLC, partnership, or sole proprietorship. From there, you want to get set up with your employer identification number, also known as your EIN number. Obtaining an EIN number is crucial for your business's credibility, and the reason is quite simple. It's just like we all have a social security number, businesses have their own nine digit identity number, which is a business tax ID. And this is what's needed for all the boring but necessary financial stuff like filing taxes, opening business bank accounts, hiring employees, and establishing business credit. Applying for an EIN is pretty simple. You just need to go over to irs. gov. And apply and then follow the prompts to get that set up from there. You'll want to make sure that you have a business phone number, a 411 listing and a Google, my business listing. So you've got the name, you've got the address, and now you want to make sure that you get your phone number set up as well, though. Ideally, what you want to do is ditch that personal number, get yourself a business phone number. And this way you can show people you're a legitimate professional when you're setting up your business phone number, avoid using a personal cell phone or residential line. Lenders can sniff out the difference and remember that the goal is to increase credibility. Next, you want to get your get set up on the 411 national directory. This not only allows users to find your business name, address, and phone number, but trade vendors love to refer to these directories to verify businesses when applying for credit accounts. By default, your local phone company should automatically list your business phone number in the 411 information directory. And we should also point out that most major cell phone companies have an internal 411 system. So if you're using one of those, you're good to go. And then from there, you want to set up your Google, my business account. Think of this is the red carpet of online visibility and credibility for your business. And this is really where the magic happens. So think about all the times throughout the day, when you're Googling something or looking up a restaurant, looking up a business or anything that you're looking at throughout the day, more times than not, you're looking the business up or looking at their reviews. And this is all, all listed under Google My Business. It's great for local search optimization. Your business will appear in local search results, map listings, and even on Google Maps itself. With Google My Business, it's easy to keep accurate and up to date information right at your fingertips and lets your potential customers know who you are, what you do, You do and how they can reach you from there. You want to make sure that you have your website and email address set up. And it's not mandatory for building business credit, but having both the website and a professional business email address can significantly enhance your credibility. Regardless of industry or business, a website just makes good sense. Not only does it help your credibility, but it's really the key to generating new leads, boosting sales, and helping you reach a broader client base. And when it comes to email, it's time to retire that personal email address at Gmail and Tom at my business name. com will look much more professional than Tom at gmail. com. From here, you want to get set up with your business license. This all depends on your location and type of business. So different cities, states, and counties all have their own set of rules. So there's no one size fits all answer, but you can visit your state or city's official website to figure all that out. There'll also be a filing fee when you get your business license, which can be as low as 50 or as high as 100. I believe a little over 500 actually in some states and depending on your business, you may also need a permit, but you need to obviously spend money to make money. So this is an important, important piece to get the business set up right. The good news is that when you file your business entity, the state will inform you if a license is necessary. However, it's up to you to take care of the annual or biannual renewals. And then from there, you want to make sure that you get set up with a business bank account. If you don't have a dedicated business bank account yet, that's going to need to be on the top of your to do list. The most obvious benefit of using a business account is the credibility factor. It shows lenders, you mean business. And it can significantly expand your financing options. And let's not forget about using a business bank account will also make your life a heck of a lot easier with simplified accounting to keeping your personal and business finances separated from each other and even reducing liability. So this is definitely a no brainer. And it goes without saying, but we're going to say it anyway, that when opening up an account, you need to double and triple check you're using the correct business information, including the name and address that's filed with the state. Next, you want to set up a business merchant account. It's probably safe to assume you're going to want to get paid for your services or products. So this means you'll need to set up a business merchant account, which is where you're going to enable your business to accept credit cards or debit card payments. And by taking card payments, you'll receive, you'll increase customer convenience, and they'll be more likely to spend when it comes to getting paid. It's going to be easy. When it comes to merchant accounts, one is good, but two are better. So we recommend setting up a backup account. If your business has unusual or suspicious looking transactions. So just to review, you'll want to get set up with the secretary of state entity filing. You'll want to set up your business license, get your EIN number, set up a business bank account, set up a merchant account, get your current business credit accounts, 411 listings, your Google My Business listing, and set up your website. And these are the first steps to building your business credit.