Keeping up with Accounts Payable and Accounts Receivable is usually not a business owner’s favorite task. Paying bills on time, but not too soon, allows you to have the best use of your money.
Should your business offer a discount if your customers pay their invoices early? Some use the “2%/10Net30” policy to encourage customers to pay early. This means that if they pay the bill within 10 days they will get a 2% discount and the entire amount is due within 30 days. This may not seem like much, but if your clients pay a large amount at one time or make a series of payments, this can make a big difference for you. Most businesses have bank accounts that earn interest. The longer the money is in your hands, the more interest you will earn.