It is very important to be financially sound when you're running a business. But what's equally critical? Making sure your business is loan-ready. If you're going to secure that funding, you need to be compliant across the board. Here are the essential steps you need to be prepared before you apply for that loan.
Step 1: Incorporate Your Business
Cost: $100-$200
Action: Head over to your Secretary of State's website and check to see if your desired business name is available. Once confirmed, proceed with the incorporation.
Step 2: Get Your Tax ID/EIN
Cost: Free
Action: Wait a week to make sure your incorporation is official. Then go to www.irs.gov to get your Tax ID/EIN.
Step 3: Open a Business Bank Account
Cost: Varies
Action: Take your incorporation papers and your new Tax ID to open a business account. Choose wisely; different banks offer different benefits.
Step 4: Register Your Domain and Set Up a Website
Cost: Domain fees vary
Action: Secure your business name as a website domain on godaddy.com. Use wix.com or weebly.com to create a simple 1-2 page site.
Additional Tips:
Dunn’s Number: Secure a D-U-N-S number via Dun and Bradstreet.
Why You Need a D-U-N-S Number
Cost: Free, but expedited services cost extra.
Action: Apply through Dun and Bradstreet’s website.
So, What's the Big Deal?
A D-U-N-S number is more than just another identifier for your business. It's a universal standard, a nine-digit code that serves as a unique fingerprint for your business in the corporate world. This isn't a box-checking exercise; it's a gateway to a lot of opportunities.
Why it Matters:
Credibility: Having a D-U-N-S number boosts your company’s credibility and integrity in the market.
Business Opportunities: Some corporations and government entities won't do business with you unless you have a D-U-N-S number.
Credit Profile: It’s the starting point for establishing a business credit file, separate from your personal credit, which is vital for obtaining supplier and financial credit.
Global Reach: It's recognized worldwide, opening doors for global trade and partnerships.
Remember, folks, this number is your business's ticket to a broader world of financial stability and opportunities. Don’t overlook it; embrace it.
NAV.com: Get your business listed here. This is like the credit report for your business.
Now, where does NAV.com come in? Think of it as your personal business credit concierge. Not only does NAV.com help you monitor your credit across various bureaus, including Dun & Bradstreet, but it also offers personalized insights to improve your credit score. It's like having a financial guru in your pocket, telling you exactly what moves to make to impress lenders and secure that business loan.
So, putting it all together: Dun & Bradstreet sets the stage, and NAV.com helps you fine-tune your performance.
There's no magic wand to make a business loan-ready overnight. It’s all about setting the right foundations. Incorporation, a Tax ID, a business bank account, and an online presence are your basics. Take these steps seriously and you'll be ready when it's time to apply for that business loan.
Carl Agard is the Publisher and Editor in Chief of Boss XL Magazine and the Author of the Book "Financially Surviving COVID19 (Deleting Derogatory Credit)"
For more tips and information, follow at IG @carlagard_themoneyexpert
