What "Net 10 Days" Means

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If a business bills customers using an invoicing system, each invoice will show payment terms. Payment terms vary from industry to industry, and a company can decide what terms work best for the business and its customers. Net 10 days is one common payment term.

Payment Is Due

Net 10 days on an invoice means the full amount is due no later than 10 days after the date of the invoice. Other common terms include net 20 and net 30, requiring payment within 20 or 30 days, respectively. As a way to motivate customers to pay promptly, a company may offer a discount for quick payment. For example, "1/10, net 30" gives the customer a 1 percent discount if a bill that is due in 30 days is paid in 10 days or less.

References

About the Author

Tim Plaehn has been writing financial, investment and trading articles and blogs since 2007. His work has appeared online at Seeking Alpha, Marketwatch.com and various other websites. Plaehn has a bachelor's degree in mathematics from the U.S. Air Force Academy.

Photo Credits

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