11-15-2012 05:57 AM
you shouldn't be charging inventory on a credit card. If I was your card issuer, I'd shut you down in a heartbeat for that.
You need to develop business credit and get some net15 ot net30 accounts with your suppliers. Step one is to register with Dun and Bradstreet.
Business credit can take quite a while to establish, and no one wants to be the first. I use credit cards for all of the inventory I purchase and have not had any issues yet. With some margins being so thin, an extra 2% helps a lot. Having cards with no interest help a lot because I can charge and not have to worry about it for a year. If I didn't use cards, I would not have sold anywhere near as much as I have already.
11-19-2012 04:12 PM
We are going off topic, but I have min net 90 with all my vendors with some I get net 180 to 1 year I have some invoices that are upwards 100k.... We pay them monthly so instead of writing 600-700 checks like we did before a year. We write only like 50 checks a year now. It is so easy to pay vendors with a credit card and just pay on bill a month rather than worry on tracking 600-700 checks.. And we get points for it. I'm not financing inventory I'm just paying regular monthly bills and getting points for it... I don't really see the risk.. Especially when I pay in full every month, don't have a single payment ever due( dont let balances report), if I push 400-450worth of spending this year which I'm sure I will reach the banks are making a lot of money off the processing fees. If I owed money and only make min payments and max out the lines I see the problem. But I'm not doing any of that ...
Have you thought about the Plum card? If you're just cycling inventory through it you could pick up 2 percent on your margin if you're an early payer.
11-20-2012 06:37 AM
myFICO is the consumer division of FICO. Since its introduction 20 years ago, the FICO® Score has become a global standard for measuring credit risk in the banking, mortgage, credit card, auto and retail industries. 90 of the top 100 largest U.S. financial institutions use the FICO Score to make consumer credit decisions.>> About myFICO