Net Terms Explained: Offering Flexible Payment Options to B2B Buyers

Everything you need to know about Net 7, 30, 60, and 90 day payment terms.

If you sell to businesses, you have probably encountered the question: "Do you offer net terms?" For many wholesale buyers, paying at the time of order is not how they operate. They expect to receive goods, sell through inventory, and then settle the invoice. Net terms make that possible, and offering them can be the difference between winning and losing a B2B account.

What Are Net Terms?

Net terms are a form of trade credit. When you offer "Net 30" to a buyer, you are giving them 30 days from the invoice date to pay for their order. The product ships immediately, but the payment is deferred. The number after "Net" indicates the payment window in days:

• Net 7: Payment due within 7 days. Suitable for small orders or new accounts where you want to extend credit cautiously.
• Net 30: The most common term in wholesale. Gives buyers a full month to pay, which aligns with typical business accounting cycles.
• Net 60: Two months to pay. Often used for larger orders or buyers who need time to sell through inventory before settling.
• Net 90: Three months to pay. Typically reserved for high-trust, high-volume relationships or industries with longer sales cycles.

Why Net Terms Matter for B2B Growth

Offering net terms is not just a convenience. It is a competitive advantage. Here is why:

• Larger order sizes. When buyers do not have to pay upfront, they order more. Cash flow constraints are the number one reason wholesale orders are smaller than they could be.
• Customer loyalty. Extending credit is a sign of trust. Buyers who receive net terms from you are far less likely to switch to a competitor.
• Industry expectation. In many verticals, net terms are standard. Not offering them puts you at a disadvantage against competitors who do.
• Faster deal closing. Procurement teams at larger companies often have approval processes that assume net terms. Requiring upfront payment can delay or kill deals.

When to Offer Each Term

Not every buyer should get the same terms. A smart net terms strategy matches the payment window to the risk level and relationship stage.

Net 7 works well for first-time buyers or small accounts. It gives them a taste of credit without exposing you to significant risk. If they pay on time, you can upgrade them.

Net 30 is your default for established accounts. Most B2B buyers expect it, and it balances your cash flow needs with their purchasing patterns. This is the term you will use for the majority of your wholesale customers.

Net 60 is appropriate for buyers who place large seasonal orders or operate in industries where inventory turns slowly. Fashion, furniture, and specialty goods often operate on 60-day cycles.

Net 90 should be reserved for your most trusted, highest-volume partners. The risk is real at 90 days, so only extend this to buyers with a proven track record of on-time payment.

How to Set Up Net Terms on Shopify with NetWise

Shopify does not natively support net terms for all merchants, but NetWise makes it straightforward. Here is how it works:

1. Create customer groups based on trust level, order history, or account type (e.g., "New Accounts," "Established Buyers," "Enterprise Partners").
2. Assign net terms per group. In NetWise, each customer group can have its own payment terms. New accounts get Net 7, established buyers get Net 30, and your top partners get Net 60 or Net 90.
3. Buyers see their terms at checkout. When a B2B customer with net terms reaches checkout, they see the option to place the order on account rather than paying by credit card. The experience is clean and professional.
4. Track outstanding invoices. NetWise tracks which orders are on net terms, when payment is due, and which invoices are overdue, giving you visibility into your accounts receivable.

Managing Risk with Net Terms

Extending credit always carries risk. A few practices help you stay protected:

• Start short. Every new account begins with Net 7 or prepayment. Upgrade terms only after they demonstrate reliability.
• Set credit limits. Cap the total outstanding balance a buyer can carry. If they hit their limit, they need to pay down before placing new orders.
• Monitor payment behavior. A buyer who consistently pays on day 29 of a Net 30 term is very different from one who pays on day 45. Track patterns and adjust terms accordingly.
• Communicate clearly. Make sure your terms, late fees, and expectations are documented in your wholesale agreement before the first order ships.

Net Terms Are a Growth Lever

For Shopify merchants moving into B2B, net terms are not optional. They are expected. The good news is that with the right tools and a structured approach to credit risk, offering flexible payment terms is manageable and profitable. Start conservative, upgrade based on behavior, and use automation to keep track of it all.