Glossary
What is an early payment discount?
An early payment discount is a small price cut a supplier offers for paying ahead of the due date. It is written as terms like 2/10 net 30: 2 percent off if you pay within 10 days, otherwise the full amount by day 30. Taken across a year of invoices, those two-percents add up.
How the terms read
2/10 net 30 is the shorthand. The 2 is the discount percent, the 10 is the days to claim it, net 30 is the full due date. 1/15 net 45 works the same way with different numbers.
The catch: you have to see the date
The discount only helps if you catch it before day 10, which means knowing the invoice date the moment the bill lands. InvoiceJet reads the issue and due dates off each invoice and tracks them, with a Monday digest of what is coming up, so the window does not pass unnoticed.
Common questions
Is 2/10 net 30 worth taking?
Usually. Two percent for paying 20 days early works out to a high annualized return, well above what the cash earns sitting in an account.
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