Business credit is important for protecting your personal credit. As a rule of thumb, you should avoid using personal credit for business expenses and purchases. Incurring large business expenses with your personal credit will increase your credit utilization ratio, which measures how much credit you are using in relation to your credit limit.
Building business credit and establishing company credit scores requires strategic planning. Not all vendors or creditors report to the business credit bureaus. Owners who take the necessary steps to establish their company, can limit personal liability and damage to personal credit, while making it more likely to be approved for business credit cards, leases, financing, and partnerships.