Net terms aren't a cost centre. They're a growth lever.

If you ask most finance teams how they think about net terms, net 30, net 60, net 90, you'll hear words like "exposure," "risk," "working capital drag," and "cost of carry." Net terms are treated as a concession: something you offer because the market demands it, but would rather not if you had the choice.

This framing made sense when data was limited and trade credit tools were blunt instruments. But with better intelligence available today, it's worth asking whether net terms are being undervalued, and how much growth suppliers are leaving behind by treating them purely as a cost to manage.

What the data actually says

Research across B2B trade consistently shows that offering net terms doesn't just accommodate buyers, it changes their behaviour in ways that directly benefit the supplier.

In construction, a research found that 81% of firms offer trade credit to drive repeat business.

The impact on order size is equally clear. Allianz Trade reports that suppliers offering flexible payment terms see a 60% increase in average customer orders. When buyers have breathing room on payment timing, they don't just buy, they buy more, more often. 

Net terms aren't just accommodating a preference. They're creating a retention advantage.

And when net terms aren't available? B2B buyers will walk away entirely. Not negotiate. Not ask for alternatives. Walk away.

The working capital argument and why it's incomplete

The standard argument against net terms is straightforward: when you offer net 30, you're effectively lending money to your customer for 30 days. That cash sits on your balance sheet as receivables rather than in your bank account. There's a cost to that, both the opportunity cost of not having the cash and the risk that the customer doesn't pay.

This is all true. But it's an incomplete picture, because it only measures the cost side of the equation. It doesn't measure the revenue side.

Consider a supplier that shifts from payment-on-order to net 30 for qualified buyers. Yes, their receivables increase. But if order volume goes up by 40%, buyer retention improves, and repeat purchase rates climb because customers prefer trading with them over competitors who demand immediate payment, the net financial impact is overwhelmingly positive.

The cost of carrying net 30 receivables on a £50,000 customer is a calculable, bounded number. The value of retaining that customer for five years at growing order volumes is a much larger number. Finance teams who only see the first number are optimising for the wrong thing.

Net terms as a competitive weapon

In construction, where supplier-buyer relationships are long-term and transaction volumes are high, net terms are increasingly a competitive differentiator rather than a cost of doing business.

Buyers in construction operate with project-based cash flows. They incur costs before they get paid by their clients. A supplier who offers net 30 or net 60 is effectively aligning their payment terms with the buyer's cash flow reality, making it possible for the buyer to take on more projects, order more materials, and grow their own business.

That alignment creates loyalty. PYMNTS Intelligence found that 72% of B2B buyers are more loyal to suppliers who offer their preferred payment method. 

This is the dynamic that transforms net terms from a cost centre into a competitive moat. The supplier isn't just extending credit. They're embedding themselves into the buyer's operations in a way that makes switching expensive and inconvenient.

The risk can be managed. The growth can't be replaced.

The concern about net terms is ultimately a concern about risk: what if the buyer doesn't pay? And in construction, where insolvency rates have been rising, this concern is legitimate.

But the answer isn't to withdraw terms. It's to extend them more intelligently.

When suppliers have access to real-time, continuous data about how their buyers actually behave, payment patterns, financial trends, operational signals, they can offer terms to the right customers with confidence. They can set limits that reflect current reality rather than year-old filings. They can identify early warning signs before a good customer becomes a bad debt.

The risk of net terms doesn't come from offering them. It comes from offering them blindly, based on static scores and stale data. With better intelligence, net terms become what they were always meant to be: a tool for growing the business, not a liability to be managed.

Rethinking the finance team's role

The shift from net terms as cost centre to net terms as growth engine requires a change in how finance teams see their own role. In the traditional model, the credit team's job is to protect the business from losses. Success is measured by low bad debt ratios and tight collections.

In the new model, the credit team's job is to enable growth while managing risk. Success is measured not just by what was lost, but by what was gained, new customers onboarded, retention rates improved, order volumes growing.

This doesn't mean taking more risk. It means taking smarter risk, backed by better data and continuous intelligence. The suppliers who make this shift will find that net terms aren't a drag on their balance sheet. They're the engine behind growth.