60 is the new 30

No, this isn’t about the next hip fad in fashion or cosmetics.  Nor is it to announce the discovery of a secret fountain of youth.  "60 is the new 30" refers to a recent trend of how long it takes to get paid in the B2B marketplace.  It was once assumed that you would get paid within 30 days after selling goods or performing services for a customer.  However, that is no longer a safe assumption.  In today’s tough economy, companies are routinely taking longer to pay their invoices, making 60 days the new normal.  


What to do about this?  Any small business owner knows that their cash flow is their lifeblood, so they have to walk a fine line between ruffling their customers’ feathers and being so flexible that they place themselves in financial peril.  So take a minute to consider a couple of options:


1.  Revisit your payment terms with your current customers.  Just because someone has paid you within 30 days in the past does not guarantee that they will in the future.  Openly communicating with your customers will ensure that you are both on the same page about what you have both agreed to.

2. Get paid up front.  If extending credit to your customers is negatively affecting your cash flow, then you may no longer be able to extend to them the privilege of credit.  Accepting credit cards is one way to transition your customers into paying you immediately.



Proactive communication with your customers is the key in reexamining and/or modifying payment terms in order to keep your business’ cash flow positive.