The next step, after you've established your D-U-N-S number and have set up at least five active accounts with merchants, such as Staples and FedEx, is to open a business credit card account.

For the past six months, you've been actively using your trade accounts and paying off the balance in a timely manner --even if you're only purchasing a package of Post-It notes. During the seventh month, check to see how your credit is improving. Go to eUpdate, which is the free D&B Web site where you'll find your credit report, including your Paydex score.
If you've been paying every account before an invoice is generated, you should have a Paydex score higher than 80. The range is between 0 and 100, with scores over 80 considered the best.

With a score over 80, now is the time to take you business credit to the next level by applying for a business credit card. Most of the major credit card companies insist that you be in business for two years before they will extend you credit. But, hopefully, when you set up your business bank account, you took the time to find a bank friendly to small businesses.

Make an appointment to meet with the manager who handles small businesses at your branch. Explain that you have been building your Paydex score with trade accounts and now you want to open a Visa or MasterCard to use with other businesses.

Remember, don't use your personal credit history to apply for these credit cards. To build business credit, you need the cards to be issued to your company. One of the biggest mistakes that a business owner can make is to use a personal credit card for business financing.

If you have managed your bank account well and the bank manager can see your business income is growing, it is likely the bank will extend an account to you. If you are told their bank policy prevents this, in spite of your excellent Paydex score and your account history, look for a compromise.

Maybe you can open a secured credit card that will convert to a regular account after six months of positive payment history. With a pro-small business bank and a history of responsible business credit, it is likely you will walk out of the bank approved for a credit card.

Once you receive your business credit card, continue with the same habits you've established for your trade accounts, paying in full as soon as or before you receive a statement. Two months after you receive your first business credit card, and your history for that account has been reported to D&B, you want to apply for a second business credit card.

Unlike with personal credit, your business credit will not take a hit by opening more accounts. Your Paydex score will not go down when you open business credit accounts or when a merchant checks your business credit history.

Why should you apply for more credit cards, even if you don't really need them? Because in business credit, there is the 5-3-2 rule. For a solid business credit record to be established, a company needs to have five active trade accounts, three business credit cards, and two small loans paid in full.

Don't be concerned if your first credit cards have relatively low credit limits. As you use the cards and pay for your purchases each month, your limits will increase. When your company crosses the two-year mark, apply for a major business card and continue the excellent credit management habits you've established.

Having business credit cards, not misusing them, and making timely payments can help boost your business credit rating quickly. But please keep in mind that your small-business credit cards will be noted on your personal credit reports. A few late payments could seriously damage your personal credit score as well as your Paydex score.

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Content provided by D&B, the leading provider of business information for credit, marketing, and purchasing decisions worldwide.