If you’re a business owner looking to manage your cash flow better and build business credit, Grainger’s net 30 terms can be a great option.
This guide will walk you through everything you need to know to get started, from understanding what Grainger net 30 is, to applying for it, and leveraging it to build your business credit.
This is what’s in store:
Now, let’s dive in!
What is Grainger Net 30?
Grainger is a leading supplier of industrial products, including tools, equipment, and supplies for various industries. And, it doesn’t hurt that their shipping speeds tend to be super fast.
Grainger Net 30 is Grainger’s credit program, extended to businesses to buy now and pay later—30 days later. This means you can make purchases immediately and have 30 days to pay the invoice, giving your business more cash flow management flexibility.
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How Does Grainger Net 30 Help Build Business Credit?
One of the early steps to build business credit is to set up a number of tradelines with companies that report your payment history with business credit bureaus, including:
- Dun & Bradstreet (D&B)
- Experian Business
- Equifax Business
Once your business credit is established, you can apply for and obtain business lines of credit that are typically substantially larger than what consumer credit provides.
When you pay your Grainger net 30 account, Grainger reports to D&B, a business-exclusive bureau. If you have your DUNS number associated with the net 30 account, in this case, your payment history will be reported.
So, a net 30 account in good standing can have a considerable, positive impact on your business credit score.
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Grainger Net 30 Requirements
To qualify for Grainger net 30 terms, you need to meet some basic criteria. Luckily, they’re not difficult to meet.
Here are the key requirements:
- Business based in the U.S.
- Confirmed DUNS number
- In operation for at least 90 days
Some sources say that you may need to spend at least $50 before you qualify for credit terms, but this isn’t my experience. If your experience is like mine, you should be able to make a $50 purchase with net 30 terms right away, pending that you follow the right steps.
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How to Apply for Grainger Net 30
Applying for Grainger Net 30 terms can be a straightforward process. If you follow these steps, you can successfully apply for and make the most of Grainger’s Net 30 terms to manage your cash flow and build your business credit.
1. Establish Your Business
Your business should be legally established with a verifiable address. This means having a business license in your state, a registered business name, an Employer Identification Number (EIN), and a DUNS number.
Ensure you have all your business documents in order before applying. And, use the same business name and address consistently across all your documents.
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2. Register Your Grainger Business Account
You need to register your Grainger account as a business. Do not register for a personal account. During registration, select “Register and create a new business account.” This ensures you are eligible for business credit terms and reporting.
To do this:
- Visit the Grainger website.
- Click on “Register” at the top right corner.
- Under “Registration type” select “Register and create a new business account.”
- Fill out the required information about your business.
This part is pretty straightforward.
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3. Have Clean Business Credit History
Grainger doesn’t check your business credit history for the starter $1,000 credit line. However, a clean credit history is helpful for future credit limit increases. For the starter limit, they will verify your business registration with the Secretary of State (SOS) database, a quick and efficient process.
For a Grainger net 30 account, make sure your business is registered with the SOS and keep your business information up-to-date. It’s also crucial to pay all of your accounts on-time as agreed when establishing business credit history.
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4. Provide Trade References (Optional)
While not required, providing trade references can strengthen your application. These references are other businesses or suppliers that you have successfully conducted transactions with and who can vouch for your creditworthiness. Including them can make your application more robust.
Gather contact information and permission from your trade references. Use references who can confirm timely payments and good business practices.
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5. Choose the ‘Credit’ Billing Option
After your account is established, you should have the option to request payment by credit or billing. To leverage net 30 terms, choose ‘credit.’ You may need to contact Grainger (via chat or customer service) to enable this option—This allows you to use the net 30 terms effectively.
Log into your Grainger account to check your billing options. Contact Grainger’s customer service if the credit option is not automatically enabled.
While Grainger doesn’t officially have a minimum purchase amount on an invoice to qualify for net 30 terms, they prefer that you spend at least $50. This helps ensure that your payment history is reported to a business credit bureau, which is beneficial for building your business credit profile.
Plan to make purchases of at least $50 to ensure your payment is reported. Track your purchases and payments to maintain a good credit record.
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Frequently Asked Questions
What is the credit limit for Grainger?
The default credit limit for Grainger’s net 30 account is $1,000. For this initial limit, Grainger does not perform a credit check but verifies your business registration with the SOS database. If you need a higher limit, you may need to provide additional financial documents and have a good payment history.
Does Grainger sell to individuals?
Yes, Grainger does sell to individuals, but net 30 terms are typically reserved for business accounts—If you are an individual looking to purchase from Grainger, you can still buy their products, but you will need to pay at the time of purchase rather than receiving credit terms.
How many net 30 accounts do you need?
While there is no specific number of net 30 accounts you must have, it is generally recommended to have at least 3-5 Net 30 accounts to build a strong business credit profile. These accounts should be from different vendors and report your payment history to business credit bureaus.
Final Thoughts
Setting up net 30 terms with Grainger can be a valuable step for your business, since it gives you cash flow flexibility and can help establish your business credit profile. By following the steps outlined in this guide, you can ensure a smooth application process and take full advantage of the benefits Grainger offers.
Whether you’re just starting out or looking to strengthen your existing business credit, Grainger’s net 30 program can be a useful tool in your financial strategy.
Do you want to learn exactly how to obtain up to $100K in business credit in as few as 30 days? Join Business Credit Workshop today!