Dun & Bradstreet (D&B) is one of the oldest commercial data and credit reporting companies. It maintains files on businesses worldwide and assigns each a nine-digit D-U-N-S number used to identify the business.
How it works in factoring
Factors and suppliers use D&B data mainly to understand how a company pays its bills. A D&B report may include:
- Company identification: legal name, D-U-N-S number, addresses, executives and corporate family links
- Payment experiences reported by suppliers, summarized in a payment index (PAYDEX) on a 1 to 100 scale, where higher values reflect faster payment
- Indicators of financial stress or risk of failure
- Public filings such as UCC liens, suits, judgments and bankruptcies
When a factor considers buying invoices owed by a customer, a D&B report is one of several sources it may check. It is usually combined with other bureau data, the customer's history with the factor and direct verification.
A D-U-N-S number is also required for some government work. For example, federal contractors historically used it for registration, although the federal government has since moved to its own Unique Entity ID.
What to check
- Look up your own D-U-N-S profile and correct any wrong details
- Ask suppliers who pay on time to report your trade experiences
- Do not rely on any single data source when deciding whether to extend credit
- Be wary of paid "credit building" offers; basic D-U-N-S numbers can be obtained without charge
Business credit data is useful, but it reflects what has been reported. Gaps or errors are common for smaller companies.