Learn How They Pay Their Bills
You will learn many things about a company by doing a Commercial Background Check. Such a how long they've been in business, they annual sales, do they have any lawsuits, judgments, tax liens.One of the most important things you will learn is how they pay their bill. This is some time called Accounts Receivable Days. A/R Days, Accounts Receivable Days or Creditor Days, all mean basically the same thing. How many days does it take for your customer to pay its bills or obligations.
A/R Days will tell us how your customer is currently viewed by the its suppliers and creditors. If there are slow pay they are in all likelihood unable to raise sufficient cash to pay everyone on time. They maybe in a "rob Peter to Pay Paul" type of business practice.
If they continue to do business in this fashion it is only a matter of time before they and their creditors have a major problem.
We will look for the tell tale signs that will enable us to steer you clear of this type of company before you become involved.