Small Business Credit ScoreCreditworthiness of small enterprises
The Business Juice
Your company's creditworthiness makes a big distinction between which utilities you can go to and which prices you can hedge. What makes utilities decide your creditworthiness? Commercial power is not inexpensive and is used in large volumes, so vendors are conscious that non-payment will have a significant effect on their own business.
Utilities also consider a so-called SIC (Standard Industrial Classification), which is used to categorize different types of business. The reason for this is that they can often have a high fluctuation of managers and this insecurity concerns them. In contrast to the home markets, utilities can select which business consumers they want and are free to decide that they only want to buy companies they believe have a low credit for.
A less than impeccable creditworthiness and/or membership of an industrial sector classified as high exposure may mean that the choices of power provider and power rate may be narrow. But even if they accepted a small loan business, the utilities could do it: Demand an extra bonus, demand a bond, demand that you make a direct debit purchase, instal a prepayment counter (the power saver of a pay-as-you-go cell phone).
Apart from taking measures to enhance your creditworthiness, there are a number of things you can do to ensure that you do a good business with your business power. Using Business Juice, we can tell you which vendors are more likely to be accepting clients with bad credit ratings.
Experian's Business Information Service CEO Max Firth has this guidance on how to improve your business ratings. Companies that are caught by the radars will find it difficult to obtain credit and service.