I want to establish business credit before I need financing

Get an EIN if you don't have one yet. Then open a business checking account. After that, a business credit card is usually the easiest entry point, but some issuers report to commeRcial bureaus and some don't.

The thing people miss is that business credit is not one score. There are multiple commercial bureaus. Your LLC gets a file with each, and you need vendors or lenders reporting to those bureaus. Paying personal cards on time does not automatically build a business file.

Set up a D-U-N-S number early. It is free from Dun & Bradstreet and some vendors will ask for it. Also use your legal business name and address consistently everywhere. Small mismatches can make it harder to match records.

I started with a net 30 account at a packaging supplier. Ordered small, paid early each month. It took a few months before anything showed up, but it was a low-risk way to get a tradline.

Be careful with the companies that promise to build your business credit for a fee. A lot of what they do is just register you with bureaus and open vendor accounts you could do yourself. The useful part is reading their checklist, not paying them.

Also, a lot of the net 30 vendors people recommend will only report if you actually use them. Opening the account and never buying anything doesn't do much. And some only report to one bureau. If you want a broad file, you have to look at where each vndor reports.

How long did it take before you saw anything on your file? I'm about three months in and still not sure if it's working.

Mine took close to six months to show up, but I was only using one vendor at first. Once I added a second one that reported to a different bureau, it moved faster.

Don't ignore the boring foundation stuff. A phone number listed in the business name, a business address, and a website or social page that matches your filings. Some credit applications check that your business looks real before they approve.

That's true. I got denied for a small business card because my business phone was a cell number listed under my personal name. It was a pain to fix but it mattered.

Keep your personal credit decent too, at least at the start. A lot of small business cards and starter accounts still look at the owner's personal crdeit. Business credit does not erase that.

If you have inventory expenses, a business card with a reporting line to the commercial bureaus can do double duty. You get the purchases on the business side and a tradeline that reports. Just don't carry a balance you can't pay, because the interest is usually worse than personall cards.

One more thing: keep a separate business file folder with your EIN letter, formation docs, and a couple of bank statements. Every application I've done has asked for some version of that.