Understanding Business Identification: The Complete Guide to DUNS Numbers

Many businesses often mistake their employer identification number (EIN) for a DUNS number. While these identifiers may seem similar, they serve vastly different purposes in the business world. The IRS issues EINs for tax purposes, whereas DUNS numbers function as quick identification tools that offer insights into different companies.

Finding Your Company's Identification Number

If you're wondering whether your business already has this identification number, checking is straightforward. You can search by your company's name or phone number through the Dun and Bradstreet lookup tool. This service makes it simple to verify your status or research potential business partners.

After confirming your status, you might also want to check your credit score report using your identification number. The credit scoring system ranges from 0 to 100 and categorizes businesses into three risk groups:

• 0-49: High-risk companies

• 50-79: Medium-risk companies

• 80-100: Low-risk companies

This scoring system provides a quick overview of a company's credit standing and can help determine whether a business relationship makes sense.

What Is a DUNS Number?

The Data Universal Numbering System (DUNS) number is a unique nine-character identifier assigned to individual businesses. Its primary function is to provide a standardized way to identify companies.

There's also a variation called the DUNS+4 number. This extended identifier adds a four-character code to the basic number, allowing companies to designate different bank accounts within the same organization for electronic payments.

It's worth noting that Dun and Bradstreet doesn't issue the DUNS+4 variation. Instead, businesses can obtain one through the System for Award Management (SAM) website.

Recent Changes to Government Business Identification

As of April 4, 2022, the federal government moved away from using DUNS numbers as the sole identifier for entities conducting business with it. The government now uses the Unique Entity ID, which is generated directly within SAM.gov. This change simplified the process by eliminating the need for entities to visit third-party websites for their identifier.

Despite this shift in government practices, DUNS numbers remain valuable in the broader business community. Since Dun and Bradstreet stands as the nation's leading business credit-reporting bureau, having this identifier allows anyone to quickly check your business credit history—a crucial factor when others assess your company's trustworthiness.

This identification can open doors to new business opportunities with manufacturers or major retailers like Kroger. Before collaboration, companies want assurance of your credibility, and this number provides that information efficiently.

How to Obtain Your Business Identifier

If your business doesn't already have a DUNS number, you can get one by visiting the Dun and Bradstreet website. The process is free for any business. Be cautious of any service charging fees—these are likely scams you should avoid.

To apply, you'll need to provide:

• Your business name and address

• The CEO or business owner's name

• The year your business started

• Your primary business type

• Number of employees (both full and part-time)

• Your business's legal structure (corporation, partnership, etc.)

Taking a screenshot of your submitted information is advisable, especially if you plan to register with SAM later. Their system requires your details to match exactly, or they might reject your registration.

The processing time is typically up to two business days, though some applications complete within a single day. If you don't receive your identifier within ten business days, contact Dun and Bradstreet directly. They might reach out to verify your company information is current.

After receiving your number, the bureau analyzes your credit accounts and determines your PAYDEX score. This credit score often becomes the most essential information other companies review during credit checks.

You also have the option to include your business in D&B's marketing listings sold to other companies. While this can boost your networking opportunities, the choice remains yours.

International Business Considerations

Businesses outside the United States can also obtain DUNS numbers. Foreign companies don't need a federal Tax Identification Number (TIN). The application process remains similar, though you'll need to select your specific country.

Be aware that processing times for international applications may extend to several weeks before you receive your foreign business identifier.

Business Risk Assessment

When planning to implement electronic data interchange with established companies like Kroger, suppliers can generally trust the legitimacy of such arrangements. However, when working with less familiar retailers, conducting proper research becomes essential.

Obtaining identification numbers for potential partners allows you to assess business risk effectively. This simple step can save significant headaches by verifying a company's financial stability before forming business relationships.