Business credit

TRUiC offers these five tools

Recent economic trends, especially regarding sanctions, have shown that Western countries with aligned value systems do more business with each other. This was illustrated by the recent US sanctions against Russia. These sanctions were followed by many other Western countries imposing similar sanctions and many Western companies closing or drastically reducing their presence in Russia. To compensate for this loss of trade, Western nations favor commercial relations between themselves. This can be an indication of future trends in the international trade space.

Therefore, the expansion of a European company into the American market has never been so timely. It can be a daunting and difficult task, but this article aims to equip you with the tools you need to succeed in the United States.

1. Establish business credit

Business credit is extremely important in the business environment in the United States. Your company’s credit score will affect your company’s ability to acquire any form of loan, credit card or even favorable terms from suppliers. It will also impact the perception of your business and its viability as a business. Fortunately, building up business credit is a straightforward process in the United States. The first step in establishing business credit is to create an LLC. Most, if not all, reputable lenders in the United States will require your business to be a legal business entity. An LLC is the easiest legal entity to establish that offers limited liability asset protection. Banks and other lenders also prefer this structure because it protects the business from risk on behalf of the owner.

The next step is to acquire an Employee Identification Number (EIN). It works the same way as social security numbers for individuals. It will be important for tax purposes and will be needed to open a business bank account, another essential part of business credit. A business bank account will be required to acquire a business credit card. Obtaining a business credit card will provide cash to your business as well as being a way to establish your business credit. Store credit cards are also recommended as they build your credit and provide various benefits for your business.

If you want more information about how to create business credit check out this website for more resources and helpful tips on how to get business credit quickly and efficiently.

Photo: TRUIC

2. Create an LLC

An LLC or Limited Liability Company is a business entity that provides limited liability asset protection to its owners. The advantage of this is twofold. First, the company is protected from any liability on behalf of the owner and second, the owner is protected from any liability on behalf of the company. This is a very useful business structure to establish in the United States and, as mentioned, it is also the first step towards establishing business credit.

3. Understand US law

US law is made more complex by the relationship between the federal government and individual states. Federal law applies to each state, but each state has its own legislative powers for its internal affairs. The extent and use of these powers differ from state to state. This also extends to the area of ​​tax law. Each state has different laws regarding personal and business income tax. This means that the tax varies wildly by state. Some states have no income tax while others have high tax rates. It is very advantageous for a European company to seek the best state to establish, as this can have significant advantages in terms of taxation and the ease of doing business. It is also recommended that your business consult with an attorney or accountant knowledgeable in the laws of the state in which you wish to do business.

4. Learn from the mistakes of others

The best way to avoid making mistakes is to learn from the mistakes of others. Many European businesses have thrived in the United States while many have failed. It is important to understand why this has happened and to learn from it. Studying examples of companies in your industry that have successfully transitioned across the Atlantic is just as important as studying companies that have not. Both of these will equip your business with the knowledge to succeed and, more importantly, not to fail.

5. Networking

Networking is a fundamental aspect of business. Developing and maintaining relationships is essential to the success of any business. While your business most likely has a well-established network in Europe or at least your home country, it’s unlikely to transfer seamlessly to the United States. Differences in culture, language and nature of business will also make it more difficult to translate networking skills. It’s something that can grow over time and is also massively supported by the rise of social media. Brand awareness is extremely beneficial for expanding your business in the United States as it helps your customers become familiar. This can be developed easily and effectively with the help of social media presence and social media marketing. Social media can also be used as a tool for business networking because social media like LinkedIn is designed to make it easy to make those connections.

Final Thoughts

With the combination of these tools, your business can succeed in the highly lucrative US market. Setting up an LLC with the first step towards the success of your business as well as the first step towards developing your business credit rating. This is essential to obtain additional financing for your business. Gaining an understanding of US law and how it can be used to your advantage will help immensely with your business’s ability to succeed. Learning from the mistakes of others will give you the information your business needs to avoid those mistakes altogether. Finally, networking will give your business the edge it needs to beat the competition and earn its place in the United States.

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