The difference between 'respectably constituted' (a pass) and 'figure larger than normal' (a caution) is very little indeed. The same can be said for 'would not enter into a commitment' (a caution) and 'fully committed' (a fail). Remember this is only one piece of information.

Trade References

Trade references are slowly dying out. The problem lies with the probability of being supplied with a truly independent reference. Obviously, customers will only give you the details of businesses that they have a good relationship with (and why not). There is also a probability of customers giving you references that are members of their family, or friends.

If you are given the name of a prominent business, be that local or national, it is worth applying for a reference, preferably by telephone, you can ask for details over the telephone that you may find difficult to word in a letter. Like wise, the reference contact may tell you more over the telephone than they are willing to put in writing.

Independent References

If you have been in business for a number of years, you probably know a few other business owners who would 'put you straight' about a potential new customer who has been less than trouble free to them. If you are new to business you will have difficulty obtaining independent references. It is therefore of great importance to establish your credibility with your peers.

Look to join local business clubs (they are not just for networking), trade groups, or just 'pop in' to similar businesses and talk about how you could help each other.

Source of Enquiry

Ask your potential customer how they came to hear of you. The reply could be of benefit to you:

a) If an existing customer recommended the customer, you have established a link: the more links, the safer the risk

b) If a fellow supplier/provider recommended the customer to you, you might be about to hit the 'big time'; however, you may also be about to give credit to a customer no one else would!

c) If you are being recommended, you have something other people want: find out what it is, and tell people about it: make sure it is not free credit!