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Building business credit is all about investing in the financial health of your small business. In other words: it’s a long game. As such, though there are such things as short-term wins, getting your small business into the excellent range of scores involves sticking with the credit building process over a long period of time.
Because the point of business credit is to show potential lenders and creditors that your business is a qualified and reliable borrower, your business’s overall financial profile needs to be up to par. Building business credit should be part of your financial routine; not an afterthought or something you “cram” for before trying to get funded. Therefore, the best way to build business credit is by establishing tiny habits that build on each other over time.
In James Clear’s Atomic Habits, he talks about how to form tiny habits that get big results when compounded over the long term. In the book, he argues that consistent 1% improvement is better than the cycle of sprinting and burning out, and that these small wins eventually lead to exponential growth. There are a lot of theories and methods out there that can help you implement systems that will help you reach your goals, but for the purposes of this guide, we’re going to follow Clear’s system. These habit ideas follow his four pillars of habit formation: make it obvious, make it attractive, make it easy, and make it satisfying.
Make it Obvious: Business Credit Building Ideas
Making it obvious is all about effectively placing triggers in your everyday environment that will help you remember to do whatever it is you want to start practicing. How many times have you intended to do something, but simply forgotten? These ideas are for the small business owner that always has good intentions, but tends to forget about their business credit.
1. Track your time
Tracking time is not directly related to building business credit, but it’s a good way to start being aware of how you’re currently spending your time. If you feel like you have no time to focus on your business credit, on top of all the other things you need to do in your business, then try keeping track of how long your tasks are taking to see where you can cut time. Maybe you’re spending a lot of time answering emails or scrolling on social media. Or, maybe there’s a process you do repeatedly that can either be automated or outsourced.
2. Automate or outsource, and replace
If you’ve identified an area where you can automate or outsource a task, then do so, and replace that time with “business financial wellness” time. Every time you go to do the old task, simply replace the action with checking in on your score.
3. Be aware of how you spend your money
Take time every week to look at your transactions and see where you’re spending money. Are there expenses you can cut? Can you pay with cash or via ACH if you’re using too much credit? Maybe you’re putting business expenses on your personal credit cards, so those purchases are not getting counted towards your business credit. Awareness is the first step. PS - you can do a cash flow check in the Tillful App, and check your score at the same time.
4. Set a 5 min reminder to check your score every week
Checking your score takes 2-5 minutes. Set a calendar block for 5 minutes every week on a day of your choice to check in on your score.
5. Stack your check-in time
According to Clear, habit stacking is a great way to remember to do certain things. For example, you can choose that every day after having your coffee, you’re going to check your score. Or, if there’s something you do every week, such as an errand, then commit to checking your score before or after.
6. Block social media (or other distractions)
For many of us, social media is both incredibly beneficial to growing a community, and also a vice that steals time away. But maybe you have another app that’s particularly distracting — what’s your most-used one? Download an app such as Opal to block your distractions. Every time you try to open your blocked app, do something for your business instead, like (you guessed it) checking your credit score or reviewing your credit card statement.
7. Use post it note reminders
If you tend to ignore digital reminders, and instead need physical ones, try putting a post it note somewhere you will see it, like on the fridge or in your lunch sack. If you use a physical planner, for example, you can put a post-it note on the same day every week to remind yourself to do something for your business finances.
8. Turn on notifications for whatever service you use
Try turning on notifications for whatever service you use, whether that be Experian, CreditSignal, or Tillful. You might want to pair this with turning off notifications for other apps that are either distracting, or that you don’t use. That way, you only get reminders for your top priorities.
9. If you check in on your personal credit score, check your business credit right after
This is another great way to engage in habit stacking. If you have a time where you check in on your personal credit score, simply remember to check your business credit score right after. Or, if you’re checking your personal finances, check your business finances right after.
Make it Attractive: Business Credit Building Ideas
Do you dread doing your business finances? Does thinking about looking at your credit card statements make you want to crawl into a hole? Let’s reframe that by pairing your new habit with something you enjoy.
10. Check it whenever you indulge yourself
Make your business finances and credit score part of your self-care routine. If you’re taking some time to indulge (maybe in some wine or chocolate?), check your score at the same time. Or, make your business financial routine fun by incorporating your favorite snacks, or doing it in a beautiful place.
11. Make it part of your wellness routine
Have a self-care routine? Maybe it’s just 20 minutes of alone time with a nice bath — make it 22 minutes with a score check.
12. Check every month to see if you can qualify for better cards, loans, etc.
Do you like to gamify your life? Check in on your options every month (or three), and see how far you’ve come. Credit cards and loan products are a direct reflection of what your business credit score can do for you. Just make sure that you’re looking at pre-qualified offers and/or using soft pulls only!
13. Write down or celebrate every score increase
Keep track of where your score is every month. For every month that it goes up, celebrate your win in some way, whether it be having a nice dinner, buying yourself a gift, or going on a special outing.
14. Join a small business group, and publicly set your financial intentions
There are quite a few small business groups out there. Chances are if there isn’t one in your community, there is definitely one just a few clicks away. Join a group of entrepreneurs (or create your own) that sets goals together and keeps members accountable. Then of course, set your goal for your business finances.
15. Set a reminder of why you need to build credit
For some people, remembering their “why” is a key part of helping them stay motivated and on track. If this is you, then try setting a daily reminder on your phone that pops up in the morning. In it, write 1-2 sentences about why you want to focus on your business credit. Make sure you read it every day!
Make it easy: Business Credit Building Ideas
Building business credit can seem overwhelming and hard, but it doesn’t have to be. Make it easier for yourself to check in with these simple steps.
16. Set your dashboard to be your homepage on your internet browser
If you use one of the credit monitoring services more often than others, then set your dashboard as your internet homepage. That way, whenever you open your internet browser, you’ll see your business’s financial health.
17. Put your credit monitoring app next to your most opened app
Do you have an app that you're constantly checking, like Instagram or Candy Crush? Put your credit monitoring app next to it so that you always see it (and maybe open it instead).
18. Set all your bills to be paid on one day, then batch pay
Batching is a really effective way to get things done efficiently. Why not apply it to business finances too? If you’re focusing on paying all your bills faster, instead of fragmenting your attention in an effort to pay them all as they arise, try moving all your due dates to the same day. Then, batch pay.
19. Automate payments
In a similar vein as the above, automate your payments where you can. Most credit cards and vendors will allow you to do this, ensuring that you never have to worry about missing a due date. Cash flow challenges do exist, so just make sure you don’t over-automate and end up with overdrafts.
20. Pay your credit card every Friday
To keep your credit utilization down, try paying off your business credit card as often as you can. Set a day, for example Friday, to pay as much of your statement off as possible. Every week, your utilization will go down, instead of having it build up to the end of the month. Plus, earlier payments will do your score favors.
21. Download the Tillful app and turn on Face ID
If you use Tillful, download the app and turn on Face ID. It’s an easy way to log in on the go and check in on your score and funding options.
22. Set your bills to be paid with your business credit card
If you have invoices or other bills that you pay via ACH, cash, PayPal, or something similar, simply change your method of payment to your business credit card. This way, your everyday expenses help you build business credit. Pair this with one of the habits about paying bills regularly to make sure you stay on top of your credit card expenses.
23. Ask one vendor to report
Don’t have a business credit card or other financial tradeline? You’ll need to get at least one tradeline to start building business credit. Instead of trying to reach out to all your vendors and suppliers at once to ask them to report, just reach out to one. Getting one done could have a snowball effect, making it easier to reach out to the rest.
Make it satisfying: Business Credit Building Ideas
According to Clear, making a habit last long term is about making it satisfying. If you want to keep engaging in the habit, then it starts to become second nature. Here are a few ways to make business credit building satisfying.
24. Mark how many days or weeks in a row that you’ve checked in
If you like to see your progress laid out in front of you, check off each day that you’ve checked your score (or done something else for your business credit) on a wall calendar. If, for example, Mondays are your business credit days, then you’ll see a line of checked off Mondays at the end of the month. It can be satisfying!
25. Pay yourself $5 every time you check your score or pay a bill early
If you like to reward yourself with money, then make a “tip jar” for every time you check your score or pay a bill early. Put $5 (or more, or less) in the jar every time you complete a small habit. Then, use the money in the jar to do something fun.
26. Pair something that makes you happy with business finance days
In Effortless, Greg McKeown writes that he and his wife disliked doing their finances, so they paired them with chocolate covered almonds in order to make the task fun. You can do something similar for yourself — choose something that makes you happy, whether it be chocolate almonds, a soothing face mask, or a nice cup of tea, and pair it with your business finance tasks. Soon enough, you’ll look forward to checking in on your finances and business credit, and that can only be a good thing.
Last Word on Building Business Credit Habits
For many people, small business owners included, things like business credit, finances, and taxes can feel like a chore that gets pushed off until it can’t be delayed any longer. However, financial health is crucial to keeping the dream alive. If you want to start making your business credit a priority, start small with manageable goals and processes. Who knows, maybe finances could even become fun!
