How do I negotiate better payment terms with suppliers?

Better payment terms can help you manage cash flow and reduce financial stress. Here’s how you can make it happen:

1. Build Trust: Start by building a solid relationship. Clear communication and paying on time for initial orders go a long way.
2. Start with the Standard: Most suppliers begin with a standard 30% deposit and 70% balance on shipment – use this as your starting point for negotiating.
3. Ask for More Time: For repeat orders, try negotiating extended payment terms like “net 30” or “net 60” to give you more breathing room.
4. Offer Alternatives: Suggest alternatives, like partial payments, letters of credit, or other solutions, to share the risk and make it easier for both sides.
5. Leverage Bulk Orders: Bigger orders can often help you secure better terms, like smaller deposits or longer payment windows.