Net 30 means the full amount on an invoice is due 30 calendar days after the invoice date. An invoice dated 1 October 2026 on net 30 terms is due by 31 October 2026. The question founders actually face comes next: a customer asks for net 30 or net 60, and you need to know what saying yes does to your cash.
The common terms, with real dates
Every row below uses an invoice dated 1 October 2026 (the net 30 EOM row uses 2 October).
| Term | What it means | Due date |
|---|---|---|
| Due on receipt | Payable when the invoice arrives | On receipt |
| Net 15 | Full amount within 15 days of the invoice date | 16 October 2026 |
| Net 30 | Full amount within 30 days | 31 October 2026 |
| Net 60 | Full amount within 60 days | 30 November 2026 |
| 2/10 net 30 | 2% off if paid within 10 days, otherwise the full amount within 30 | 11 October 2026 with the discount, 31 October without |
| Net 30 EOM | 30 days after the end of the month the invoice is dated in | 30 November 2026 for an invoice dated 2 October |
Net 30 EOM is the one that catches people out. An invoice dated 2 October is due on 30 November, nearly two months later, even though "30" is in the name. Some companies use EOM to mean something slightly different, so write the actual due date on the invoice rather than relying on the abbreviation.
A customer asks for net 60: what it costs
A startup has €240,000 in the bank and a net burn of €30,000 a month, which is eight months of runway. It signs a new customer at €12,000 a month, invoiced monthly. The customer's procurement team asks for net 60.
The revenue is the same under any terms. What changes is how much of it is sitting unpaid at any moment:
| Terms | Unpaid at any time | Cash you can actually use | Runway |
|---|---|---|---|
| Due on receipt | about €0 | €240,000 | 8.0 months |
| Net 30 | about €12,000 | €228,000 | 7.6 months |
| Net 60 | about €24,000 | €216,000 | 7.2 months |
cash tied up = monthly invoice x (payment days / 30)
= 12,000 x (60 / 30)
= 24,000
Net 60 takes 0.8 months off this company's runway for as long as the contract runs. That can be a fair price for landing the customer. Decide it with the number in front of you, and consider the levers you have:
- Invoice monthly in advance, at the start of each service period, so net 30 lands roughly when the month of service ends.
- Accept longer terms and put them in the price.
- Offer net 30 with an early payment discount, if cash now matters more than margin.
A customer big enough to dictate terms is also one you may come to depend on. When one customer is too big covers that risk.
What an early payment discount really costs
"2/10 net 30" looks like a small discount. Work out the rate: the customer keeps 98% of the money 20 days earlier than they had to, in exchange for 2%.
annual cost = discount / (1 - discount) x 365 / (full days - discount days)
= 0.02 / 0.98 x 365 / (30 - 10)
= 37.2% a year
You are paying 37.2% a year for that money. Offer it when you need cash badly and have no cheaper way to get it, and not as a default because it looks professional.
The legal limits on long terms
In the EU, the Late Payment Directive says the payment period in a business contract should not exceed 60 calendar days unless it is expressly agreed and not grossly unfair to the supplier (Directive 2011/7/EU, Article 3). In the UK, an agreed payment date must usually be within 60 days for business transactions, and longer terms have to be fair to both sides; public authorities have 30 days (GOV.UK, when a payment becomes late). A customer asking for net 90 is asking for something you can refuse with the law behind you.
Once the terms are agreed
The due date only helps if the invoice goes out on time and someone follows up when it passes. Getting paid on time follows one invoice from contract to cash and covers reminders and late-payment interest. For the forecast, count money when it arrives rather than when you invoice: revenue on net 60 is revenue now and cash in two months, and a cash flow forecast that ignores the gap shows a longer runway than you have.