What do D&B ratings mean?

A D&B Rating measures your company’s size and creditworthiness. Lenders and suppliers may use this rating to decide whether to do business with your company.

What does a 5a2 D&B rating mean?

5A = Financial Strength Indicator. 1 – Composite Credit Appraisal or Risk Indicator. Risk Indicator. – Range of 1 to 4 (1 – low risk; 4 – high risk) – 1 indicates a minimal risk and 4 indicates a significant level of risk.

What is a high D&B score?

The Basics: 1 to 100. Dun & Bradstreet assigns scores on a scale of 1 to 100, with 100 being the best possible PAYDEX Score. Scores are divided into three Risk Categories, with 0 to 49 indicating a high risk of late payment, 50 to 79 indicating a moderate risk, and 80 to 100 indicating a low risk.

What is a D&B failure score?

The D&B Failure Score (formerly the Financial Stress Score) predicts the likelihood that a business will, in the next 12 months, seek legal relief from its creditors or cease business operations without paying all its creditors in full.

What does D&B rating 1R2 mean?

If your business is being rated according to its employee count, you will have one of these ratings — 1R2, 1R3, 1R4 or 2R2, 2R3, 2R4. The number before the R defines your employee count, with 1R meaning you have 10+ employees and 2R designating less than 10 employees.

How is D&B calculated?

How Is the D&B Failure Score Calculated? Dun & Bradstreet aggregates company information from a variety of sources. These include public records, financial statements, and past payment experiences. The Failure Score also weighs a company’s demographics against those of similar firms in the same industry.

Is 80 a good Paydex score?

A Paydex score of 80 or higher puts your business into the best risk group, meaning that your history of payments has demonstrated a low risk of late payment. Dun & Bradstreet is one of the major business credit reporting bureaus, alongside Equifax and Experian.

How do I improve my Duns score?

There are two main ways to improve and build your PAYDEX Score:

1. Make on-time payments. Aim to pay all of your suppliers on time, or early if you can.
2. Report payments to D&B. You’ll also need to make sure that your suppliers report your payments to D&B.

How do you read a D&B rating?

Dun & Bradstreet assigns scores on a scale of 1 to 100, with 100 being the best possible PAYDEX Score. Scores are divided into three Risk Categories, with 0 to 49 indicating a high risk of late payment, 50 to 79 indicating a moderate risk, and 80 to 100 indicating a low risk.