Payment Terms for B2B

[Big Bird]

What is the most common payment terms in the UK?
My understanding is monthly billing, payment in 21 days.

Is it rare to have weekly billing, payment in 7 days?
Please advise.

[SimonMac]

I think weekly billing and 7 day payments is very rare, but doesn't mean its impossible, most I have seen are four weekly billing and 7 day payment

[Wanderer]

What is the most common payment terms in the UK?
My understanding is monthly billing, payment in 21 days.

You get all sorts. If they are going to pay in 21 days then you want to be billing weekly not monthly. With monthly billing and 21 day terms, your business is extending up to 51 days of credit to their company and that's not an acceptable credit risk in my book. Hell, no business would extend 51 days credit to my business so why should I do it?

[SueEllen]

What is the most common payment terms in the UK?

There isn't.

You can get immediately after the bill is sent up to 180 days.

You need to work out the minimum you can get away with, and factor in the fact you may need to take up to 3-6 more months to get the money out of late payers.

[northernladyuk]

I have 2 B2B contracts at the moment.

They are both monthly invoicing with 30 days payment terms. Oddly, one of them I invoice at the start of the month before I've done any work. They asked me whether 'that will be acceptable'?

[craig1]

It's a difficult question to answer and all depends on the negotiations. The best way is to give an example of my last two consultancy contracts:

1. 3 month consultancy exercise with set deliverables at 2 pre-agreed milestones. Payment terms: Cheques handed over for 5% entire invoice on signature, 10% on agreed first day, 35% on first milestone completed (no assessment), 35% on second milestone met (no assessment) and the last 15% on presentation of final report.

2. 6 month consultancy exercise with only one final core milestone pre-agreed. Payment terms: 14 day payment after receipt of invoice. Invoice milestones: 10% on signature, 10% on first day, 5x10% monthly invoices, 20% on presentation of final report, 10% non-refundable retainer paid at end to cover 3 months of email Q&A on their implementation.

Contractor invoicing is far simpler and far less of a pain to administer. Throw off an invoice and timesheet, wait until due payment day and chase if it's not there.

[Big Bird]

Thanks!

[SimonMac]

I spoke to soon, just got my new contract through and its monthly billing 30 days payment, oh hum

[Wanderer]

I spoke to soon, just got my new contract through and its monthly billing 30 days payment, oh hum

Tell them you have done a credit check on them and there is no way your business is extending 60 days credit to their business.