Credit products vital to business success: shop around and prepare in advance.

• Author: Barbour, Tracy
• Position: Company overview

Having access to business financing is critical for Airport Equipment Rentals, Alaska's largest construction rental company. Airport Equipment Rentals company uses wholesale credit through large institutions such as GE Capital to purchase equipment. This financing helps the company to maintain its 3,000-plus equipment rental inventory, featuring worldwide brands like John Deere, Genie, Wackor and National/Alamo.

The available credit also positions Airport Equipment Rentals to capitalize on new opportunities, according to General Operations Manager Scott Strand. "You may have this project that you can tell is profitable, but if you don't have the capital available to purchase equipment, you won't be able to participate," he explained.

Credit is a double-edged tool for Airport Equipment Rentals. In addition to using equipment loans to facilitate inventory purchases, the 20-year-old company offers retail credit to its customers. Extending credit to customers makes it easier to sell products and services to a broader market.

Airport Equipment Rentals is among the many companies, large and small, that rely on credit to support their operations. Credit can be the lifeblood of businesses needing a constant stream of capital to maintain and grow their operations.

IMPORTANCE OF HAVING GOOD BUSINESS CREDIT

Without business credit, companies must operate on a cash-only basis, which can limit their access to opportunities and potential for growth. Also, owners of the business may be forced to use their personal credit to secure business credit lines, equipment leases or bank loans. This can, of course, jeopardize their individual credit history if their business fails.

On the other hand, building good business credit is an important component to the success of any business. It can have a positive effect on the company's ability to borrow and negotiate favorable financing terms.

But establishing good business credit takes planning, effort and time. Companies can start by borrowing or buying products and services from vendors or suppliers that extend payment terms. As they make consistent and timely payments, their positive payment history will get reported to the three major business credit reporting bureaus: TransUnion, Equifax and Experian.

BUSINESS CREDIT CARDS A POPULAR OPTION

Alaska's financial institutions offer companies a wide range of credit products, including business credit cards, credit lines and loans. Business credit cards are a widely...