* Industry Challenge: Slow turnover on receivables affects cash flow, presenting a challenge in maintaining a healthy buyer/supplier relationship.
* Extended NET Terms: Negotiating extended payment terms can provide the buyer with additional time to manage cash flow effectively without straining the relationship with the supplier.
* Cash Flow Management: Extended terms help align payment schedules with cash inflows, reducing the financial pressure on the buyer.
* Mutual Benefit: This approach is mutually beneficial as it provides the supplier with a predictable payment schedule while offering the buyer improved cash flow flexibility.
References
* ISM. (n.d.). Managing Payment Terms in Supply Chain.
* CIPS. (n.d.). Negotiating Payment Terms and Conditions.