Thats interesting, I always wondered how they handled credit terms and asking for payment. Speaking from a small-sized distributor perspective, its extremely frustrating dealing with credit terms with customers. I actually despise it. With automated technology, there is no reason a company should have to employ an accounts receivable human. However, the problem becomes where you have to have an actual human call the customer regularly and ask for payment because they wont respond to your automated emails. Because they say "oh no, i never got your emails or letters in the mail"
What I have found is when you give a customer 30 day net terms, more often than not, its not paid within 30 days. Im not saying all, but MORE often than not, this is the case. We send out an automated reminder as soon as the bill comes due within 30 days. We then receive payment 2-3 days later which is OK i guess but surprising to me, why wouldnt you pay your bill on time before its due? And then worse, for some customers, 30 days actually means 60 days. We have some customers who pay religously, but they are religously late around 45-60 days.
What is really frustrating is when you ask for payment and its aged like 45 days or so, their response is "we have not gotten paid from our customer yet." Really?! Your cash flow problem is not mine. Well i guess it is now but geez.....