When dealing with Non Limited entities such as sole proprietorships or partnerships it can sometimes be tricky to know the information you require, how to obtain it and to be confident in setting a realistic credit limit or even whether you should give a limit at all.
With Non Limited entities the owner(s) are jointly and severally responsible for outstanding monies and in the case of outstanding debts any or all of the owners can be chased for the value plus costs and interest.
The starting point of credit checking your Non Limited customers and ensuring you know who you are dealing with is to have a full application form which require details such as company details, ownership details, residential address(es), bank details and trade references. It is also wise to make a note on the application form that consumer credit reports will be carried out with any application.
The next suggestion for credit checking your Non Limited customers would be to take up given trade references to ascertain details like how long your subject has dealt with the given reference, what credit terms they have (7 days, 14 days, 30 days etc), average purchases, credit limit and comments of the account.
In my opinion the best way of being confident of knowing exactly who you are dealing and whether they are credit worthy is to combine the two steps above with using both business information available online which will give you details on the business in question and also consumer credit reports which will give details on the business owner(s) behind the business. You can easily obtain information of electoral roll, CCJ and derogatory information, credit search history, demographic profile, address links and credit score via an online credit reference agency.
If you may need any further information or if you have any questions please do not hesitate to contact me via twitter @creditserve, on LinkedIn at Martin Brown or Email martin@creditserve.co.uk
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