As a small business owner, you should verify each customer’s credit prior to shipping your goods. If a customer pays cash or submits a credit card when placing the order, you have been paid in advance, and, unless he charges back on his credit card, there are no worries. However, if you extend credit prior to shipping, you are risking non-payment for merchandise that is out the door. You may have revenue that is booked, but your cash flow will suffer.
There are several companies that can check your customers’ credit. Experian will perform this for you, and it has different services for a small business as opposed to a medium or large enterprise.