It’s common practice for companies to perform background checks on employees, independent contractors, and applicants. If you’re offering services to other organizations, you shouldn’t only be conducting background checks on your workforce but also on companies you do business with. Not doing so puts you at risk of encountering fraudulent businesses or organizations that would leave you high and dry.
Here are other reasons you should look deeper into a company before working with them.
- License and Other Business Requirements
As a legitimate and law-abiding organization, you wouldn’t want to be associated with fraudulent companies or those that fail to meet government requirements. A background check helps you find out if their licenses are in order and if they’ve complied with all the requirements needed to operate as a business. It will also let you know how long they’ve been in the industry, giving you an idea of how stable the company is.
Don’t let your company be caught in the middle of a lawsuit. Working with a company that has an ongoing investigation or lawsuit could put your business at risk of being investigated too even if you’re not directly involved with the situation.
When checking for lawsuits, look into the validity of the case. Is the company truly at fault? Avoiding businesses with lawsuits also helps you avoid having to file a case of your own should your dealings with the company go awry.
- Credit History
A poor company credit score should be a red flag. Imagine investing in an organization or providing them your services without being paid on time –or at all!
A credit report gives you an idea of the company’s financial situation. Should you still want to continue working with the organization, at least you’d be able to work out a payment schedule that works best for both businesses. This way, you won’t be surprised with unexpected delays on payments.
- Previous Business Names
A company screening helps you find out whether the organization has used other business names. If they have used several, be careful in dealing with the company. Changing business names frequently could mean the previous ones may have received complaints, bad reviews, or lawsuits. And they’re trying to start on a clean slate.
Avoid sticky situations by making sure you’re only working with businesses you can trust. Alert Checks offers a company screening service. We’ll prepare a detailed company background report, which includes their key personnel, SIC code, credit score, and other important information.
Get in touch with us at (407) 682 5378 or send an email to firstname.lastname@example.org to learn more about how we can help keep your business safe from fraudulent and high-risk companies.