Payment Terms

Payment terms define when invoices are due. Setting appropriate terms helps manage cash flow while meeting customer expectations. CloudRent Pro lets you set defaults and override per customer or invoice.

Available Payment Terms

Term	Meaning	Best For
Due on Receipt	Payment due immediately when invoice received	New customers, high-risk, COD
Net 7	Payment due within 7 days	Short-term arrangements
Net 14	Payment due within 14 days	Regular customers
Net 30	Payment due within 30 days	Established accounts, corporate
Net 60	Payment due within 60 days	Government, large enterprise
Prepaid	Payment required before equipment released	New customers, one-off rentals

Setting Company Default Terms

• Go to Settings → Invoicing

• Find "Default Payment Terms"

• Select your default

• Save

This applies to all new invoices unless overridden.

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Tip: Most equipment hire businesses use Net 7 or Net 14 as the default. This balances customer flexibility with cash flow needs.

Customer-Specific Terms

Set different terms for specific customers:

• Open customer profile

• Find "Payment Terms"

• Select their terms

• Save

Customer terms override company defaults when creating invoices for that customer.

Invoice-Level Override

Adjust terms on individual invoices:

• Open or create invoice

• Find "Payment Terms" or "Due Date"

• Change as needed

• Save

Use this for special circumstances without changing customer defaults.

How Due Dates Calculate

Due Date Calculation
Invoice Date + Payment Term Days = Due Date

Example:
Invoice Date: 1 March
Terms: Net 14
Due Date: 15 March

Due dates are calculated automatically when invoices are created.

Terms Hierarchy

When creating invoices, terms are applied in this order:

• Invoice-level override (if set)

• Customer default terms (if set)

• Company default terms

Overdue Tracking

Invoices become overdue when:

• Today's date is past the due date

• Invoice is not fully paid

Overdue invoices show a red "Overdue" status and can trigger automatic reminders.

Managing Terms Strategically

New Customers

Start with Due on Receipt or Net 7. Extend terms after they've proven reliable.

Slow Payers

Tighten terms. If they're always paying Net 30 late, don't give them Net 30.

Large Accounts

Enterprise and government often require Net 30 or Net 60. Factor this into your pricing.

Seasonal Customers

Consider shorter terms during busy season when equipment is in high demand.

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Note: Longer payment terms effectively extend credit to customers. Assess creditworthiness before offering extended terms.

Prepayment Requirements

For high-risk situations, require prepayment:

• Set terms to "Prepaid"

• Send invoice before dispatch

• Wait for payment confirmation

• Then release equipment

Prepaid terms protect against non-payment but may reduce bookings from some customers.

Displaying Terms

Payment terms appear on invoices:

• Terms line — "Payment Terms: Net 14"

• Due date — "Due Date: 15 March 2026"

Clear terms set customer expectations and support collections if needed.

Tips for Payment Terms

💰 Match Terms to Risk

Longer terms = more risk. Only extend to customers who've earned it.

📝 Be Consistent

Avoid constantly changing terms. It confuses customers and staff.

📂 Document Agreements

Special terms should be noted on the customer profile for future reference.

🎯 Follow Up Promptly

Send reminders as soon as invoices become overdue. Delays worsen collection rates.

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Warning: Very long payment terms (Net 60+) significantly impact cash flow. Make sure your business can handle the wait.