Entrepreneurs and small business owners are facing a new era when it comes to applying for business financing. Banks, lenders, vendors, leasing companies and others are making adjustments, adopting new rules, and facing new regulations in the lending arena.

The National Small Business Association (NSBA) says 55 percent of the small business owners it polled in February had been affected by the credit crisis and that number has now increased to 67 percent. The three biggest concerns in this survey were general economic uncertainty, rising energy costs, and the rising cost of health care.

Now more than ever I believe entrepreneurs and small business owners need to be pro active and embrace a new level of preparation, compliance checks, and business credit preparation in order to stay ahead of the game.

 Here's my ‘Top 10 Business Credit Strategies for Entrepreneurs ‘

Strategy #1:

Establish a well written business plan

When it comes to bank financing a business plan that supports a loan request provide a greater chance for funding. Here are 10 reasons you should have a business plan.

Strategy#2

Incorporate your business

Treat your business like a business and avoid being a sole proprietorship. Here are four reasons you don't want a sole proprietorship.

Strategy#3

Obtain a Federal Tax ID# for your Corporation

You'll need an EIN in order to open a corporate checking or bank account. Also, if your corporation is planning on hiring employees in the near future the corporation will need the EIN for payroll taxes, state taxes, and in order to make tax deposits (federal) on a timely basis. 

Strategy#4

Open a corporate checking account with a business credit bureau subscriber

While there is thousands of banks across the country not all report your business loan payments or business credit line payments to your business credit file. Do business with banks that report your payment history!

Strategy #5

Separate your personal credit from your business credit

This can be accomplished after you carefully follow corporate conformity guidelines that prevent your business from being ‘flagged' by the business credit bureaus. Dun & Bradstreet conducts over 2,000 compliance checks alone!

Strategy #6

Do business with vendors who report your payment history

There are over 500,000 vendors extending credit to businesses in the U.S., but less than 6,000 of them report your payment history to your business credit profile.  You have to make sure you choose the right vendors to do business with.

Strategy #7

Apply for SBA financing only after you have established some business credit

The SBA recently reported that 97% of applicants for a small business loan are declined. Why? Entrepreneurs who go directly to their banks inevitably fail to meet the compliance requirements. And most have no business credit established.

Strategy #8

Apply for bank financing only after you have established some business credit

There are 5 factors lenders use to extend business credit. Familiarize yourself with these factors before applying for financing.

Strategy #9

Improve and maintain a strong personal credit rating

When applying for bank financing some lenders may request a personal credit check as consideration for approval. If you've experienced personal credit challenges then you may want to consider credit restoration.

Strategy #10

Apply for ‘real' business credit cards

There are over 500 business credit cards in the U.S., but less than 70 reports solely on business credit profiles and not on your personal credit profile.  ‘Real' business credit cards require you to provide your Duns number and Federal Tax ID during the credit application process. If a business credit card application only requests your personal social security number run the other way!

Remember - The expectations of life depend upon diligence; the mechanic that would perfect his work must first sharpen his tools. ~ Confucius

To Your Success!

Marco Carbajo

About the Author

Marco Carbajo is a business credit specialist, social media marketing coach, author, speaker, and founder of the National Entrepreneur Club. Visit his blog and signup free to get strategies, resources, and response-boosting tips with blog updates, news, and more! Go to http://www.marcocarbajo.com. To start building your business credit and social media strategy today Click Here.