Small business finance often mires personal investment and credit with business purchases and expansion. By establishing a business credit score, you can take an important first step toward creating a dividing line between your business and personal finances, even if you're running a sole proprietorship or partnership.

The importance of a good business credit score is unparalleled, but how can you build a good credit score from the ground up? The first step is to establish your business legally and file with various business credit reporting agencies. The second step is to develop good financial habits to maintain your credit score. Finally, you'll want to monitor your score throughout the year to ensure your score accurately reflects the positive financial habits you're developing.

Here is a detailed step-by-step guide to building business credit:

1. Establish your business.

The first step toward building business credit is to establish your business legally as a sole proprietorship, corporation,  partnership or limited liability company. Create a legal name, and set up a business phone number, which will give your company added credibility with vendors and the government. Once the basic legal aspects of your company are created, begin opening accounts with vendors that report to the credit bureaus to establish your business credit file and start building credit. As with legally creating your business, this makes your company known to business credit reporting agencies.

2. Register your business with your secretary of state.

Depending on the type of business you establish as a legal entity, you may have already completed this in step 1. It is important, however, to confirm that you've completed all of the steps required by the secretary of state to ensure your business has been registered and created properly.

3. Get your EIN.

Your EIN (Employer Identification Number) is like your business's Social Security number; it's what the government uses to identify your business. Your EIN is also a major piece of information for paying business taxes throughout the year. By requesting this number once your business is registered, you're gaining a corporate ID number that you will use to file taxes, open a business bank account and apply for business licenses.

4. Open a business bank account.

Get started on separating your business finances from your personal finances by establishing a business bank account. Setting up this type of account will also help you get a business credit card and begin building a relationship with a banking partner that may be beneficial down the road if you need a small business loan to grow your operations.

5. Continue building relationships with vendors.

As you build your business, continue establishing and building relationships with vendors, and create contracts for supplies and other business materials. You build credit by paying on time or early with vendors that report to credit agencies. Not all do, and not all vendors report to the same credit agencies. Consider what your business needs, then look up which vendors in that vertical report to credit agencies.

6. Use your business credit card.

Opening, using and paying off business credit cards is another way to build business credit. Once your bank account is established and your business is in operation, open a business credit card and use it each month.  Some cards may offer rewards that can be advantageous for certain types of businesses. Keep in mind that, especially if you've just started your business, your credit limit may be rather low when you start out. As you build your credit score, your credit limit will increase.

7. Pay early and often.

One of the most powerful tools you have when building credit is simply paying your bills. By paying your bills in full and on time, you're proving that you can make good on your debts. If you pay bills early, however, you may be able to build your business credit score even faster. Credit is essentially an agreement between you and a lender that you'll pay them later for a product or service (or access to money, in the case of credit cards) you need now. So, when bills come due, make sure you pay them. This is the most basic concept behind building credit.

8. Focus on credit utilization.

An important aspect of building a credit score is credit utilization. Much like with personal credit cards, business credit cards have a recommended usage so you can maximize your credit score. It's recommended that a business owner use no more than 30% of your total limit. This proves to lenders that you're not only financially responsible but more than able to meet your minimum balance each month.