Struggling with bad debt? This nine-digit number can help you purchase a company's business credit file and use the scores and ratings in it to help you avoid risky situations and help make sure you don't get stuck with unpaid invoices.
In today's global economy, Dun & Bradstreet's Data Universal Numbering System, the Dun & Bradstreet D-U-N-S Number, has become the standard for keeping track of more than 200 million businesses and their corporate relationships worldwide.
D-U-N-S Numbers are unique nine-digit identification sequences that provide a secure identification for individual business entities. The D-U-N-S Number can be used to access a Dun & Bradstreet business credit report, which can help business owners with a multitude of issues, from risk management to managing their supply chains.
When you have outstanding invoices that your debtor refuses to pay, that's considered "bad debt". There isn't much that can help you alleviate bad debt besides taking legal action, but there is a way to help prevent it.
Checking the business credit files of the companies you plan to work with, before you enter into business with them, can help prevent compromising situations. You can purchase a company's credit file to view its scores and ratings. The data in its profile can help you decide whether or not the company is low-risk or high-risk. The scores and ratings in a business credit file are predictive and offer insights into how likely a company is to pay late, default on their payments or go out of business.
You can also see any suits, liens or judgments against the company, so you may be able to see if the company has been sued over bad debt before. Armed with this crucial data, you can make better, more informed decisions about your business partners and help prevent bad debt from happening to your company.
Checking other companies' business credit files can be one of the most effective ways to help prevent bad debt, but you can also use your own D&B® credit file to help you manage your cash flow if you're suffering from bad debt.
If you spend your time and resources to complete a project for a client who is refusing to pay, you'll likely run into cash flow issues, especially if this happens to you with more than one client. If your clients aren't paying you, or if you've extended too much credit, you may not be able to pay your own bills, and you may seek out a factoring service or a bank loan. Here is where your D-U-N-S Number can come in to play. Banks and other financial institutions may look up your company's business credit file to help them make decisions about whether or not they will offer you a loan, and on what terms. If you provide your Dun & Bradstreet D-U-N-S Number to these financial institutions, you can help show them you are confident in your business's scores and ratings. Without strong scores and ratings in your own file, you may not be able to get the funding you need to help improve your cash flow, or you may be able to secure a loan, but at high interest rates that could cost you in the long-run. By building and maintaining your business credit file, you can be ready for funding when you need it whether to alleviate the effects of bad debt or improve your cash flow.
Don't have a D-U-N-S Number?