Excuse 12: Only a day late
Where payment was only a day late, or perhaps only 2 days late.
Particularly relevant for 30 day invoices paid on day 31.
|Customer feels one day
should not get a penalty
|Basically, the customer
there should be some tolerance rather than being strict on the terms
This really only works where the customer has decided to try and pay
the invoice on the last possible day and has missed. This follows from the idea
that they must squeeze every possible day of free credit out of the
agreement, and so they are in effect playing
a game and gambling that they will get the payment in on time.
This is not too hard when making a BACS payment, but can easily go
wrong if posting or forgetting about bank holidays.
|Customer does not believe
have an obligation to adhere to the agreement they have made
|Customer may has a
misunderstanding that they don't have to do
what was agreed, but that it is fair to do whatever they can get away
with and feels aggrieved that they failed to get away with paying late
when they usually do (with other suppliers).
- Well, if it is the first time, a credit can defuse the
but the invoice serves to educate the customer that the due date is the
- Explain that the line has to be drawn somewhere. If we gave
day terms and someone paid on day 32 they would be only a day late.
Wherever the line is drawn there will always be a point that is only a
day late, so the problem just moves about. It is sensible to draw the
line where we say we will.
- If a customer has 30 day terms and sends payment on day 30,
that means they failed to send payment on each one of the previous 29
days - why? Ask them? If they have a payment system that allows
payments in a few days, and so 30 day terms mean they wait for several
weeks before doing anything, hence needing a reminder, then clearly
they need SHORTER payment terms, so that the original invoice is the
only reminder they need and they pay it immediately on receipt to pay
within terms. Suggest that!