NET 30
VS NET 60.

Reference

When the clock starts, what thirty more days cost the seller, and which term to offer which account.

CALCULATE WHAT YOUR TERMS COST →

Guide

NET 30 VS NET 60:
WHAT IT COSTS YOU.

Net terms are the number of days a buyer has to pay after the invoice. Net 30 and net 60 read like a month's difference; for a brand shipping on terms, that month is the whole cash cycle, and the clock does not start when the buyer thinks it does. This is what each one actually costs, and when to offer which.

What to know

The clock starts at the invoice

Terms run from the invoice date, not from delivery. A shipment that takes three weeks turns net 60 into net 39 of real float for the buyer and sixty days of waiting for the seller, and nobody tells either side; it simply arrives as a cash-flow problem. Invoice on shipment, and say so on the terms.

Net 30: paid 30 days after the invoice date
Net 60: paid 60 days after the invoice date
Delivery time comes out of the buyer's float, not the seller's wait

What the extra thirty days costs the seller

Every day of terms is a day you are financing the retailer's inventory. Sixty days on a line that reorders monthly means two orders in the field before the first is paid. Put a number on it: your cost of capital, applied to the order value, for the days outstanding. For most small brands that number is why net 60 should cost the buyer a slightly higher price or a slightly lower discount.

Net 60 means two months of inventory financed by you at any time
Price terms in: a small discount for prepaid, list for net 30, no discount at net 60
An early-payment discount like 2/10 net 30 is expensive to offer and very expensive for a buyer to skip

When to offer which

Prepaid on a first order from a store you do not know. Net 30 once they have paid on time. Net 60 for large accounts that pay reliably and whose volume is worth the float. A store that asks for net 60 on a first order is asking you to underwrite them; the answer is a smaller prepaid order, not a longer term.

First order: prepaid or card
Proven account: net 30
Large, reliable account: net 60, priced for it

How it works on GRAJ

A terms order becomes an invoice with a due date and aging the brand can see, and the funder role exists so a brand can be paid on shipment while the buyer still gets terms. Commission and the GRAJ fee settle when the money is collected, not when the order ships, so nobody is paid on an invoice that has not been.