Re: When is net 30?


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Posted by John on June 11, 2002 at 07:08:51:

In Reply to: WQhen is net 30? posted by M.R. Daniels on June 10, 2002 at 19:31:39:

And the dumb answer is: Net 30 means thirty days from whatever date. And the date is (a) controlled by the shipper and (b) open to interpretation.

I've seen packing slips (shipment paperwork) and the corresponding invoices with different dates. But whatever date is put on the invoice, the shipper usually assumes that the meter starts running from that date.

Some retailers honor this convention with near-religious fervor. They log the invoice into their system, and drop the check in the mail several days before the 30th, allowing it to be received by the shipper exactly on the 30th day.
Other retailers honor the "from shipment" concept, but cut a check ON the 30th day -- and maybe mail it after the weekend. Still other retailers think Net 30 means from the date of receipt, and after that all the possibilities above apply.

Net 30 is a convention, not a point of law. No one ever went to tort court for sliding a few days on an open account. That's why I always tell folks to consider Net 30 really to mean Net 45. Give it a couple of weeks for all the parameters to shake out before you start getting wierd.

Or take the bull by the horns and work out your definition of the term with your retailer before you ship. Try to look at from his/her perspective, too. If the gallery pays by credit card, the terms can really end up being Net 60 or so for them, and you eat the credit card charges. And if you consider the cycle time in the UPS system for a gallery's check to get back to you, there is little difference between Net 30 and COD, except the shipper generally builds the COD charge into the shipping and handling.

It's a puzzlement alright....


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