The Scores and Ratings in Your Dun & Bradstreet Business Credit Profile

The Dun & Bradstreet scores and ratings in your business credit profile can be used by customers, vendors, insurers, and other companies to help decide whether or not to partner with you. Each Dun & Bradstreet score or rating has its own criteria and scale, and it’s important to understand how they’re calculated so you can take active steps to impact them. Your Dun & Bradstreet business credit profile can be viewed by anyone at any time, and unfavorable scores and ratings could cost you contracts or result in higher interest rates on loans. You can also check the Dun & Bradstreet scores and ratings of partners in order to mitigate the risks facing your own business.

A business’s credit profile comprises five main scores and ratings: Three are predictive and two are performance based. The predictive scores and ratings suggest how a business will fare over the next 12 months, while the performance-based ones use historical information from a company’s Dun & Bradstreet credit profile to provide insight into the company’s past behavior. Here’s a look at the Dun & Bradstreet scores and ratings found in a business credit profile:

  1. The D&B® Delinquency Predictor Score indicates the likelihood that a business will make a late payment or fail to live up to its obligations altogether.
  2. The D&B Financial Stress Score is designed to quantify the risk of a company experiencing severe financial distress that could impact your contracts with them.
  3. The D&B® Supplier Evaluation Risk Rating gauges the risk that a vendor will shut down in the next 12 months.
  4. The D&B PAYDEX® Score is one of the most well-known and important performance-based scores. The PAYDEX is an easy-to-understand indicator that reflects how a company has paid – or failed to pay – its bills each month for the past 24 months.
  5. Finally, the D&B® Rating considers a company’s net worth weighed against its overall financial condition as a measure of creditworthiness. If a business’s financial statements are not provided, Dun & Bradstreet will base the score on company size, industry, or other related factors.

These five scores and ratings help companies understand the financial risks associated with partners (and vice versa) without having to perform exhaustive research from scratch. The underlying data used by Dun & Bradstreet comes from trade tape, trade references, and other sources, including the Global Trade Exchange Program

Why is it important for business owners to understand the scores and ratings above? Responsible lending and payment practices can build your own business credit profile into a record of success that can be seen by potential business partners, suppliers, or lending institutions. You can submit positive payment histories to Dun & Bradstreet for acceptance and approval to help impact your scores and ratings. Conversely, checking the credit profile of partners is important for protecting your company from less-than-reliable customers or vendors.