From a supplier’s perspective the most important part of any transaction is to ensure prompt and satisfactory receipt of funds for goods or services provided.
When a company oversteps the mark by abusing agreed payment terms they are in fact using the seller’s tolerance as means of providing an unsecured overdraft.
It would seem absurd to exchange a promise from your buyer for prompt settlement conditional on your company providing the upfront funds enabling them to do so.
In reality by continuing to supply a persistent late paying account this is exactly what is happening.
It is a question of commercial judgment. In these present trading conditions business is hard won but if the transaction carries a disproportionate risk then it isn’t really worthwhile.
The time and effort spent chasing a recalcitrant account could be better spent elsewhere.
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