Companies House Reports
A credit check is advantageous when deciding which
companies to trade with. A credit check will provide
you with important financial information as to a company's
financial status, therefore allowing you to make informed
decisions.
As most companies choose to extend credit to clients,
a credit check should be used as a major part in the
decision making process. Knowing the clients' past financial
history will give an indicator as to the level of trust
you should give to them.
When to use a Credit Check
Many large businesses and companies will extend credit
to their clients as they find that it is often easier
and faster to do so, having a large number of clients.
However if you are a small or medium sized company,
this practice can be potentially harmful. The client
may delay payment of goods or services; they may not
pay at all; or they are not even who they say they are
and are making fraudulent transactions. Although larger
companies are able to absorb small losses, smaller companies
cannot afford to do so. Performing a credit check on
a potential client will allow you to assess them before
making a decision to extend credit. Companies should
therefore make it normal practice to obtain a credit
check on every potential client. This practice will
reduce the risk of bad debts occuring at a very low
cost.
A credit check should also be obtained on all new and
potential suppliers. This practice will deter bogus
suppliers who may ask for money upfront, and never deliver
the goods. You will also know who to contact and where
to go if there are any problems with the goods.
In general, a credit check should be used as a reference
guide as to the financial status of a company. It also
lets you know the legal status of the company and is
a good indicator as to the future viability of the company.
A credit check is an aid to minimise the company's risk,
financial history and also how good they are at paying
back credit. It will also help you to set appropriate
credit terms and conditions with the client.
- Obtain a credit check when deciding to use or switch
to new and potential suppliers. This will allow you
to verify the exact legal entity that you are dealing
with.
- Perform an ongoing credit check on all existing
clients. This will alert you to any changes with the
client that may affect how quickly they can repay
their credit. You can then set revised credit terms
with them.
- Obtain an ongoing credit check on all existing suppliers.
- Obtain a Credit Check Online
A credit check can now be carried out online using
checkSURE. Reports are generated online immediately
after payment and therefore the costs are cheaper, saving
postage, packing and administration costs. There is
an added bonus - credit checks from checkSURE are updated
daily from Companies House which means that you need
not wait for data that may already be out of date when
it arrives to you. There are also many benefits to obtaining
a credit check from checkSURE. Registration is free
and everyone receives a personal online portfolio to
keep their past company credit checks in. checkSURE
also provides a free email alert service which emails
you everytime there is a change within your portfolio
of companies. Just register with checkSURE here
to purchase a company credit check online.
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