How to check a company before you trade
Most trade fraud and failed deals could have been spotted with a few basic checks done before the first order. Whether you are buying, selling, shipping or lending, this is a practical order to work in.
- Confirm it exists and is active. Check that the company is registered, that the registered address is real, and that its status is not dissolved, struck off or in insolvency.
- Find out who owns and runs it. Look at the directors and owners, and check whether the same people appear behind other failed or flagged companies.
- Screen for sanctions. Check the company and the people behind it against the UK, US, EU and UN sanctions lists before any money moves.
- Look for a history that fits the story. A partner who says they ship at scale should have a track record that matches. A company that is only a few months old and claims decades of experience deserves questions.
- Protect the first payment. With a new partner, use secure payment terms and avoid paying everything upfront.
Warning signs to take seriously
- Pressure to pay quickly, or a request to change bank details at the last minute.
- A company name that is almost, but not exactly, the name of a well known business.
- Only free email addresses, no working website, or contact details that do not match the registry.
- Prices far below the market, with no clear reason.
- A reluctance to share registration papers, licences or references.
- Payment requested in a different country or in the name of a different company.
Documents worth asking for
- Certificate of incorporation and a recent registry extract.
- Tax or VAT registration number, which you can check with the tax authority.
- Import or export licences where the goods need them.
- Bank reference or a company letter confirming the account details.
- Product certificates, such as quality, safety or origin documents.
Choosing safer payment terms
A letter of credit protects both sides, because the bank pays only when the agreed documents are presented. Escrow and staged payments, such as a deposit followed by a balance on shipment, share the risk. Paying in full in advance is the riskiest option, and it is best kept for partners you already know. Whatever you choose, write the terms down before any goods or money move.
Common questions
Why do some company records need an account?
Some records are shared only with registered users. A free account lets you search companies and see what is open to you.
What does a sanctions check cover?
It compares a company and its owners and directors with the published UK, US, EU and UN sanctions lists. Doing this before you trade helps you avoid breaking sanctions rules by accident.
Is a registered company always safe to deal with?
No. Registration only shows that a company exists. You still need to look at who is behind it, how long it has traded and whether the story you were told fits the facts.
Can someone check leads for me?
Yes. Our lead research service identifies new leads and checks each one before you spend time on it.