The benefit of establishing business relationship has progressively grown. Such business relationships are not formed or entered into lightly, reason because it requires a lot in it.
Entering a business relationship with the wrong entity could be highly disastrous. Such wrong business relationships can lead to monumental losses and damages to investments, brands and the goodwill of a company (i.e. reputation). It could incur legal and financial liabilities.
When considering a vendor business relationship or any other kind, it demands intentional and meticulous decision making because it is important that an entity learns more about the new relationship. Considering a contracting company/vendor can impinge on a business if a vendor background check/ due diligence is not conducted on the contracting company/vendor.
There are two types of vendor background check/due diligence. It includes business to business background check/due diligence and business to consumer background check/due diligence. These screening types entail various screening programs and responses to vital issues associated to such background check/due diligence requests.
Here are questions that can ensure the best way to sort out the wrong entity from the right one when considering a contracting company/vendor for a business relationship through background check/due diligence.
- Does the contracting company/vendor have any reputational issues? A thorough search from all available sources are required to understand that business is not carried out or associated with a brand with reputational issues. The aim is to avert possible lawsuit or other issues. A very reliable vendor background check/due diligence is highly advised to keep you abreast of such contracting company/vendor
- Are they recognized as a legal entity? Are they legally recognized to operate within the confines of the law of the specified country they operate? Are their intent of operation legally binding and lodged in the custody of the government of the specified country they operate in? What are the ownership formations of the company?
- Are the contracting company/vendor regulatory compliant? This would inform a decision to deal or not to deal with a contracting company/vendor as it would expose if a company has been sanctioned as a result of non-compliant with regulatory standards. This could have drastic draw back operationally when an organization blindly engages in a business relationship with a contracting company/vendor with regulatory issues. With the background check/due diligence program your safety to be well informed in dealings will be assured.
- Does the contracting company/vendor have civil litigation? It is never a crime to probe before engaging with a contracting company/vendor. To be well informed about the civil litigation of a prospect in business is highly advised. Engaging with a company with lawsuit is not a good option in your business. To activate a lawsuit background check/due diligence search will save you a lot. Ensure to know the content of the legal matter in order to inform your decision. Save your business from risk with a thorough lawsuit background check/due diligence.
- Does the contracting company/vendor have prior name before adopting a new name? To remain in the space of business, some companies would have folded due to bankruptcy, legal decision, regulatory issue or government sanction and then proceed with another name. An exhaustive vendor background check/due diligence program will excavate the history of such company and its previous nature of operation. It will also unravel its previous misdeeds, if any.
- Is the contracting company/vendor licensed? The need to understand the license status of a contracting company/vendor is highly important. A vendor background check/due diligence will disclose if the contracting company has not been barred for professional misconduct.
- Does the contracting company/vendor operate in a physical location?
- What is the criminal record status of the proprietors?
- Who are their employees? Knowing their employees is as vital as knowing the contracting company/vendor. A company should have a background check policy, and ensure to conduct full background check on its staff before assigning them to any organization. The principal company on its part should also mandate and recommend a preferred vendor background check provider to a contracting company/vendor.
In all, the above information will inform your business decision, relation or intent with a contracting company/vendor before proceeding to go onboard with them.
We are Clearline Background Fact. Request for a quote: verify@clearlinefact.com.ng or ndubuisi@clearlinefact.com.ng
Call us on: 09131216774 or 08090910345