Have you ever asked a question and received so many different answers that it was confusing? One example that comes to mind is when I hear a credit person ask a group, "Which credit reporting company do you recommend?"

In some respects the report question is similar to asking which automobile is the most fun to drive. A responsive, sporty, rear-wheel drive vehicle might be a great ride in good weather, but would my answer remain the same if I lived in Park City in the winter time?

Obviously it is important to ask for specific questions about credit reports because, the truth is, all data bases are not created equal. If a credit reporting company is #1 in Brazil or the best for a certain industry, does that mean it will also be a good fit for your industry? It has been my experience there is rarely, if ever, a terrific "one size fits all."

There are almost as many credit reporting companies to choose from as there are car manufacturers, including the NACM National Trade Credit Report, D&B, Equifax, and Experian, to name a few. So how does one determine which report is the best fit? Some traditional steps I have included:

Ask Your Peers: (caution) - this may provide an idea of some details (i.e., are you required to report your aging; is their format user friendly, etc.), but you are likely to receive a wide variety of opinions on which company is best. It is possible to narrow that scope of opinions by asking only credit people within your industry about a company's credit reporting merits.

Request A Demonstration: (caution) - this is useful in becoming more familiar with a company's reporting format and a chance to see what bells and whistles they offer. Just remember, demonstrations are like credit references, you will only see the most attractive part. Since demonstrations are typically skewed, you will still need to determine how well their reports fit your business. After all, how beneficial is a reporting system that heavily features data on publicly traded companies when your customers are privately owned?

Ask For Customer Sample Reports: (winner, winner, chicken dinner) - the real goal is to determine how extensively that company's data base provides meaningful credit reports on your existing customers. And, although we all are price sensitive these days, you are looking for a provider that best matches your customers, so price may not the determining factor. The reality is, unless you want an inexpensive supplementary backup, a low priced offer does not help if you only find informative reports on a small percentage of customers.

When doing a comparison test on credit reports, make a chart and/or place them side by side with new reports from your current provider. Then compare such details as:

• Is the data current - or did you notice that most of the information was from 2007?
• How accurate is the data - compared to what you may already know about a customer or what your other credit report indicates. Be sure to pick out a customer you have sent to collection, or has filed bankruptcy, or has been sued so you can verify how that customer is rated on their report. (Frequently you will be shocked).
• How often is there little or no data on their reports compared to your current provider?
• How does the cost compare to your current provider?

After doing a comparison analysis, there are a couple of other issues that may cause a credit professional to add to or change their credit reporting providers. If:

• There has been an unacceptable decline in service
• A provider refuses to justify or negotiate a significant price increase
• A company wants to invest into their future as well as that of NACM. You can invest into the National Trade Credit Report by using their reports as well as supplying your trade data. If you report your trade data, in addition to others within your industry group, it is one way to insure that you can obtain the best and most current credit information on your customers. Think of it as your 401K for credit!