Glossary · Business & Sourcing
What Is Payment Terms?
Payment terms set out when and how a buyer pays a manufacturer, most commonly a deposit on order confirmation with the balance against shipping documents or a copy bill of lading. The split and the trigger points are negotiated alongside price, because together they decide who carries the working-capital risk.
Why it matters when you source
The deposit percentage is a real measure of trust in a new supplier relationship, and it becomes negotiable as order history accumulates. Read the balance trigger carefully: paying against documents is not the same as paying before the goods leave.
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