If there is one thing we are sure of, it is that not every company can be analyzed with the same data. To work out what could be a major opportunity or a risk, you need a complete overview and several different angles. Here are 5 tips on what to look for in an external analysis.
1. What matters to your business model?
Whether it is headcount, revenue or the kind of systems a customer uses, you should track whatever helps you recognize a potential new customer, or spot the signs that this probably isn't worth spending unnecessary time on.
Data points that tell us a company is likely to have to make changes on several fronts can be valuable. It means they will probably do something that forces them to look for different solutions or suppliers than the ones they have used before. They may need to move premises, hire someone or get help with a downsizing process.
A change in headcount, up or down, can be the signal that now is the right time to get in touch.
Alerts about changes or events can be the triggers that create a need.
2. How well can the company pay?
This often calls for financial figures and your own judgment. On top of that you have tools such as payment remarks, risk assessment models and credit ratings/credit checks.
You know best how much effort is needed to determine a risk profile. It pays to decide up front whether a fully standardized credit report with a generic rating is enough, or whether you need to make your own assessments and weight individual elements differently. A deliberate, standardized approach makes it far more likely that you check everything you need to, every single time. Keep as much information as possible in one place, so gathering what you need doesn't become time-consuming.
Data quality always matters, but perhaps especially here. It has to be up to date, from a credible source, and give the full picture. Turning away someone who wants to buy is usually the last thing we want to do, so any rejection should be well founded.
A probability of bankruptcy over the next 12 months can be the indicator you need to take a closer look at the risk level.
3. Who are the owners and who holds key roles?
There are several ways to find the people and other businesses connected to a company.
Among what is available in structured registers, it is worth looking at group structure, the shareholder register, the register of beneficial owners, and keeping an overview of registered roles in the company such as the general manager and board members.
By checking whether key individuals are involved in other companies, and by looking at their wider network, you can also uncover important connections.
Example of an extract where one person holds several roles.
Example of a public network.
In some cases (if you have a reporting obligation to the Norwegian Financial Supervisory Authority) you are also required to check against an anti-money laundering register to see whether there are any PEPs (politically exposed persons) closely connected to the company.
4. How does the company look compared with similar businesses?
In many cases you may be dealing with a company in an industry you don't know much about in general. It then helps to be able to compare it with other companies in the same industry. You can do this yourself in Excel or another program, but there are also standardized analyses you can use. Reference points can be very helpful for spotting anomalies or warning signs in the numbers.
Examples from a benchmark analysis carried out by Corpia and Enin. Companies in the same industry and with a similar capital structure are compared.
5. Current events and history
It is an advantage to catch every change that could be relevant to how the company is run. Both what is happening today and what happened yesterday or a year ago can say something important about the future.
Examples of events and history for Equinor.
How do I get access to this information?
With integrated credit checks and payment remarks, anti-money laundering data and a feature that lets users document their data collection, Enin offers a comprehensive B2B tool for external analysis. We are here for those who need to know their customers extra well and who want to know every detail.
And we know there may also be a need for other macro variables that are particularly important to you.
You are welcome to try the Nordics' most comprehensive data and analytics solution for company data!
