Net-30
Payment terms that give a customer 30 days from the invoice date to pay the balance in full.
Net-30 means a customer has 30 days from the invoice date to pay. It is standard in B2B, construction, and services work, and it is one of the most common reasons an otherwise profitable business feels cash-poor: you deliver the work and cover materials and payroll now, then wait a month (or longer, in practice) to get paid.
That gap between spending and collecting is a timing problem, not a profitability problem — which is exactly what working capital is built to bridge. If you buy materials and float payroll on a job that invoices net-30, the right-sized advance covers the gap until the customer’s check clears, then retires as the receivable lands.
The discipline is matching the tool to the cycle. Fund the known, invoiced gap — not a speculative bid — and size the remittance so a customer who quietly pays on day 45 instead of day 30 does not break your week. For receivables-specific needs, compare invoice factoring and accounts receivable financing against a general working-capital advance.
Frequently asked
What does net-30 mean?
It is a payment term giving the customer 30 days from the invoice date to pay in full. Net-15 and net-60 work the same way with different windows.
Why does net-30 strain cash flow?
You pay for materials, labor, and overhead when the work happens, but the money arrives up to a month later. Multiple overlapping net-30 jobs widen that gap.
How do I bridge a net-30 gap?
Right-sized working capital, invoice factoring, or accounts receivable financing can bridge the wait. Fund the invoiced, known gap and size repayment for a customer who pays a little late.
Related terms
Payment terms that give a customer 60 days from the invoice date to pay — roughly double the cash-flow gap of net-30.
Selling unpaid invoices to a factor at a discount for immediate cash, with the factor often collecting from your customer.
Borrowing against your outstanding invoices while you keep ownership and continue collecting from customers yourself.
The cash a business uses to cover day-to-day operations — payroll, inventory, and the timing gaps in between.
An approval approach that weighs your real deposit activity and cash flow over the owner’s credit score.
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