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Whether you’re building personal credit or business credit, you have to follow a specific account progression. Generally, you target attainable ones with less favorable terms first, then work your way up to the more restrictive ones with better rewards.
If you’re building business credit, Tier 2 business credit vendors are the second rung on that ladder. You can usually start to pursue them once you’ve established multiple trade lines using net 30 accounts from lesser-known, Tier 1 vendors.
Here’s an up-to-date list of the best Tier 2 business credit vendors that report to the commercial credit bureaus.
Advance Auto Parts
Products and Services: Advance Auto Parts sells replacement and performance parts, accessories, and fluids for vehicles.
Business Credit Bureau: Dun & Bradstreet
Qualification Requirements: You must already have at least five tradelines and do business as a legal entity other than a sole proprietorship, like a Limited Liability Company (LLC) or a corporation.
Vendor Link: https://ebill.advancecommercial.com/psp/ebill/CUSTOMER/CUST/?&cmd=login&errorCode=105&languageCd=ENG
Office Depot and OfficeMax
Products and Services: Office Depot and OfficeMax merged in 2013. Together, they continue to sell traditional office supplies, such as pens, paper, binders, printer ink, and staplers.
Business Credit Bureau: Dun & Bradstreet
Qualification Requirements: You must have been in business for at least three years and have multiple tradelines with a positive payment history.
Vendor Link: https://business.officedepot.com/
Nav
Products and Services: Nav offers a service that lets you monitor your business credit scores and reports from Dun & Bradstreet, Experian, and Equifax. There are four subscription tiers, and each one provides additional benefits.
The third and fourth tiers, Business Boost and Business Loan Builder, help you build business credit with tradeline reporting. They cost $39.99 and $49.99 per month, respectively, though you can cancel whenever you want.
As long as you maintain your subscription, Nav will report your monthly payments to the credit bureaus. They’ll show up on each business credit report like any other vendor tradeline or net 30 account.
In addition, Nav guarantees that they’ll never report negative credit history to the business bureaus. Even if your payment method fails, they’ll work with you to fix the issue and maintain your positive tradeline.
If you’re a small business owner looking to build business credit, Nav’s offer is too good to refuse. Give it a try today!
Business Credit Bureaus: Dun & Bradstreet, Experian, and Equifax
Qualification Requirements: Nav’s subscription service is available to all businesses. See our full editorial Nav Review.
CreditStrong Business
Products and Services: If you’re in need of business credit building tradelines, CreditStrong is an exceptional choice. They offer a credit builder loan that will appear in your business credit reports as a financial tradeline.
Financial tradelines are typically credit accounts like loans, lines of credit, and credit cards. They’re significantly more effective at building business credit than vendor tradelines.
CreditStrong’s account registers as a financial tradeline, but it doesn’t function like a traditional small business loan. Once you open an account, CreditStrong puts your principal balance in a locked savings account and holds it as collateral.
As you make your monthly payments, part of your payments goes to interest, and part goes to paying down the loan amount. When you pay off the entire amount or decide to cancel your account, they’ll give you back the principal portion of all your payments.
Alternatively, their newest option lets you make principal-only payments and pay nothing in interest, but you’ll have to pay a higher fee up front to make up for it.
Business Credit Bureaus: Equifax Business, PayNet, and the Small Business Financial Exchange (SBFE). The SBFE subsequently shares your activities with Dun & Bradstreet and Experian.
Qualification Requirements: Your business must be at least three months old, have an Employer Identification Number (EIN), and file as an entity other than a sole proprietorship. See our full editorial CreditStrong Business Credit Review.
Home Depot
Products and Services: Home Depot offers standard home improvement products, such as paint, tools, appliances, furniture, doorknobs, and curtains.
Business Credit Bureaus: Dun & Bradstreet, Equifax Business, and Experian Business
Also Read: Startup Business Credit Cards with No Credit
Qualification Requirements: You must be a reasonably well-established business with multiple Tier 1 tradelines and a generally positive payment history.
Vendor Link: https://www.homedepot.com/c/Credit_Center
Lowe’s
Products and Services: Lowe’s also provides home improvement products, including building supplies, flooring, bathtubs, lighting, and construction tools.
Business Credit Bureau: Dun & Bradstreet
Qualification Requirements: You must be a reasonably well-established business with multiple Tier 1 tradelines and a generally positive payment history.
Vendor Link: https://businessapply.syf.com/cmlapply/ca/lowes/business-info?&sitecode=lolpllaan
BP Fuel Credit Card
Products and Services: Fuel credit cards like BP’s let you build business credit while getting cheap gas. They’re typically easier to qualify for than most other business credit cards.
Business Credit Bureau: Dun & Bradstreet
Qualification Requirements: You must be a somewhat-established business with Tier 1 tradelines and a reasonable payment history.
Vendor Link: https://www.bpbusinesssolutions.com/business-solutions-card-details/
Valero Fleet Card
Products and Services: This is another attainable business credit card you can use to build business credit and get deals on gas.
Business Credit Bureau: Dun & Bradstreet
Qualification Requirements: You must be a somewhat-established business with Tier 1 tradelines and a reasonable payment history.
Vendor Link: https://www.valerofleetcards.com/
FAQs
What is Tier 2 in Business Credit?
There are four primary tiers of business credit. Tiers 1 and 2 refer to business financing from other businesses, such as net 30 terms from a supplier.
Accounts from these businesses generally show up as vendor tradelines on your credit reports.
Tier 2 is also known as advanced trade credit. Tradelines in this tier are harder to get than those in Tier 1. They require a credit check and sometimes a personal guarantee, but they have better terms, such as higher credit limits and longer repayment terms.
What Are Tier 2 Business Vendors?
Tier 2 business vendors offer vendor tradelines that are harder to qualify for than Tier 1 vendor accounts but generally have superior terms. For example, they might carry a higher credit limit and give you more time to pay.
Tier 2 business vendors are often well-known brands, like Office Depot and Lowe’s. They check your business credit score when you apply, and usually require a few years in business, five or more tradelines, and a positive payment history.
They’re still fairly easy to get, but businesses with no credit won’t get approved.
When Can You Apply for Tier 2 Business Credit?
You should apply for Tier 2 business credit accounts once you’ve established your business credit profile to some degree. Requirements vary between vendors, but you’ll need a decent time in business, number of Tier 1 tradelines, and payment history.
For example, you might start thinking about applying for Tier 2 vendor credit accounts after you’ve been in business for two years, acquired five Tier 1 vendor tradelines, and established a generally positive payment history.
It’s also beneficial to separate your business and personal identities by establishing a business bank account, obtaining an EIN, and forming a legal entity other than a sole proprietorship. Otherwise, they may also consider your personal credit score.
Also Read:
- How To Build Business Credit Without Using Personal Credit
- Net 60 Vendors
- Secured Business Credit Cards That Report to D&B
- Companies That Help Build Business Credit
- Tier 1 Business Credit Vendors
- Business Credit Builder
Nick Gallo is a Certified Public Accountant and content marketer for the financial industry. He has been an auditor of international companies and a tax strategist for real estate investors. He now writes articles on personal and corporate finance, accounting and tax matters, and entrepreneurship.