When someone owes you money, you are exposed to Credit Risk – the risk of incurring a loss if the person will not return your money. When you are in business, you deal with many parties and have exposure to such a credit risk. Whatever the nature of your business, there will almost certainly have been times when you’ve had to ask yourself questions such as “Who exactly am I dealing with?”, “Will they pay me and when?” or “How much can I supply to them and on what terms?”
You may have supplied goods; however, your customer enjoys a 30-day or 60-day credit period for payment (i.e., Account receivables). On the other hand, you may have given some advance to your suppliers; however, you still must wait for your supplies.
Whether these risks relate to new or existing customers or suppliers, the only way to mitigate them is by having a clear, up-to-date insight into each business’s associated risks. To do that, corporates can source data through aBusiness Information Report(also known as BIR) through an independent agency such as CRIF. To better understand what a business information report is and how it helps organisations, let's dive into the specifics.
Corporates use the BIR as it provides an in-depth profile of a company, including financial statements, business trends, history of business, ownership details, operational information, and details on related firms and any special events that occurred in the past involving company management.
The CRIF business information report also provides a risk indicator and an indicative credit limit to support business managers with their decision. A comprehensive business information report includes more than just operational data and trade payment history. They are composed of various credit ratings, scores, and statistics that range from performance-based to predictive and can be used to demonstrate a company's dependability and financial stability.
Your business information report will include:
Details about the Company:
The report will include business type, registration details, company address, line of business, legal structure, key management, and shareholding structure.
Financial Information:
The report will have the background and history of the company, detailed analysis of the financial stability, ability, and status of the company to give you a clear picture of the company’s financial trends and the accurate ratio between expenses and income.
Compliance Checks and News:
A thorough check on the legal aspects of the company and news about the company to ensure the company's status in the market.
Risk Assessment:
Understanding the risk level involved in the company and the credit limit available gives an insight into the company's vulnerability. Here they also investigate the new and old relationships of the company with others.
Financial and non-financial information of the organisation:
Names of the affiliates, subsidiaries, and parent organisation, as well as the details of their relationships. Any event or activity involving the business that has recently received media attention. Business registry records, balance sheets, assets and liabilities, and trade sources.
Data on the company's operations:
Information such as the number of employees, sales and purchase terms, and operating locations.
A Business Information Report is not limited only to domestic companies. If you are dealing with businesses from any other country, companies such as CRIF can help facilitate getting you a reliable and insightful, freshly investigated business information report through its network across the globe. You can get everything from the Business Information ecosystem, from instantly generated reports to those requiring additional analysis to verify and collect data due to the lack of organisation of sources.
The insights can help you establish your credit terms, evaluate distributors, agents, buyers, and suppliers, determine profitability and analyse your potential customers. Lenders also use business information reports as a tool forcredit risk managementoriginating from third parties, especially while financing a company involved in cross-border transactions.
Now that you understand the basics of Business Information Report, leverage the power of this proven tool to secure your business and conduct due diligence. You can begin by asking for a demo by clicking here.
