How Trade References Can Impact Your D&B® Scores & Ratings

Banks, vendors, customers, and insurance companies are just a sampling of partners who may review a business’s credit scores and ratings. The data found in a business’s credit file may be used to help set interest rates, credit limits, and premiums. Trade references are one source of information that can be used to help calculate a business’s credit scores and ratings, so it’s important that decision makers understand what they are and how to utilize them when building business credit.Tweet This  We’ve put together the infographic below to serve as a resource for business owners interested in learning more about trade references.

What is a Trade Reference?

A trade reference is a report on past payment experience(s) between a business and vendor. Trade references are composed of 7 base variables:

  1. Reporting Date or As-of-Date
  2. Manner of Payment
  3. Rolling 12-month High Credit (Highest Amount of Credit Used)
  4. Current Total Amount Owing
  5. Current Total Past Due
  6. Selling Terms
  7. Date of Last Sale

Suppliers can submit positive or negative trade references to Dun & Bradstreet*. Acceptable payment experiences that Dun & Bradstreet can verify may impact a business’s credit scores and ratings, including the D&B PAYDEX® score.

Why Should Businesses Ask Their Partners to Submit Trade References?

Businesses that encourage their partners to submit trade references may be able to demonstrate a pattern of responsible financial behavior. These trade references may impact a business’s credit scores and ratings.

Can Any Payment Be Submitted to Dun & Bradstreet as a Trade Reference?

No, Dun & Bradstreet doesn’t accept trade references from:

  • Businesses legally related to your company
  • Banks
  • Credit card companies
  • Utility or gas companies
  • Landlords
  • Foreign companies
  • Companies that have requested anonymity
  • Business that have been proven untrustworthy
  • Companies without a business credit file of their own

Dun & Bradstreet won’t consider additional trade references from a company that already reports all business customers, because that information will already be in Dun & Bradstreet’s systems. Anticipated payments do not qualify as trade references.

What are Some Examples of Acceptable Trade References?

Even businesses with a limited number of contracts usually work with vendors or providers who may be able to submit trade references to Dun & Bradstreet for its verification and acceptance, including:

  • Accountants, CPAs, and payroll services
  • Vehicle and equipment leasing agents
  • Cleaning services
  • Computer repair companies
  • Construction/remodeling firms and subcontractors
  • Direct mail services
  • Freight/trucking/local delivery services
  • Furniture stores
  • Graphic design companies and printing services
  • Lawyers or attorneys
  • Marketing companies and advertising firms
  • PO box rentals (not the US Postal Service)
  • Uniform suppliers
  • Warehouse rentals
  • Wholesalers

How Can My Business Submit Trade References to Dun & Bradstreet?

Dun & Bradstreet’s CreditBuilder service makes it easy for businesses to submit trade references for approval**. Dun & Bradstreet will seek to verify your payment experience with the respective vendor. If accepted, the trade reference could impact your business’s credit scores and ratings.

Businesses can also enlist the help of a Concierge Manager for dedicated support. These business credit experts handle the details, leaving you free to run your business.

What Else Can I Do to Help Impact My Business’s Credit Scores and Ratings?

  • Pay your bills on time or early
  • Ensure that your business’s details are accurate via Company Update, a free tool from Dun & Bradstreet
  • Use Company Update to dispute any late payments in your file that you believe are incorrect
  • Submit your financial reports to Dun & Bradstreet to help demonstrate your business’s health

Featured Photo Credit: Haru1, Twenty20