How to Set Up Net-30 Terms for Contractor Accounts

Net-30 terms let contractor and business clients pay invoices within 30 days instead of at pickup. This is standard in B2B relationships and removes a major friction point — crews can drop off tools and keep working without waiting for an invoice to clear.

Why Offer Net-30 Terms?

Most independent repair shops operate on a cash-at-pickup basis. That works for walk-in customers, but it creates problems for your biggest accounts:

• Contractors can't wait. A crew drops off three drills and needs to get back to the job site. Making them wait for an invoice wastes their time and yours.
• Businesses have purchasing processes. Companies issue purchase orders and pay on billing cycles. If you can't work within their system, they'll find a shop that can.
• Credit terms build loyalty. Once a business sets up an account with you, switching to another shop means setting up new terms. That friction works in your favor. Pairing credit terms with a recurring maintenance program makes the relationship even stickier.

Setting Up Credit Terms

Before offering net-30, establish clear policies:

1. Qualify the Account

Not every customer needs credit terms. Reserve them for businesses that bring regular volume. A good threshold: at least 3 repairs per month or $500/month in revenue.

Get basic information up front:

• Business name and address
• Tax ID or EIN
• Primary contact and billing contact
• Expected monthly volume

2. Set Credit Limits

Start conservative. A new account might get a $1,000 credit limit. After 3 months of on-time payments, increase it. This protects you from large unpaid balances while building the relationship.

3. Define Payment Terms Clearly

Put it in writing. Your terms should cover:

• Payment due date (30 days from invoice date)
• Late payment fees (typically 1.5% per month)
• What happens if payment is 60+ days late (account suspended)
• How disputes are handled

4. Invoice Promptly

Send invoices the same day the repair is completed. The 30-day clock starts from the invoice date, so delays in invoicing delay your payment.

Managing B2B Accounts in Bench

Bench has built-in B2B account management. Each business account tracks:

• PO numbers — Attach purchase order numbers to repairs so the business can match invoices to their internal records.
• Credit terms — Set net-30, net-60, or custom terms per account.
• Account balance — See outstanding balance at a glance. Know who owes what.
• Multi-location support — If a business has multiple locations, track repairs by location while billing to one corporate account.

Common Pitfalls

Don't skip the written agreement. Verbal terms lead to disputes. Even a simple one-page document protects both sides.

Don't extend terms to everyone. Net-30 is for established business relationships, not one-time customers. Keep walk-in customers on standard payment.

Follow up on late payments immediately. If an invoice hits day 35 without payment, call. The longer you wait, the harder it is to collect.

Summary

Net-30 terms are table stakes for B2B repair work. Set clear policies, start with conservative credit limits, invoice promptly, and follow up on late payments. The right software makes this easy to manage without spreadsheets or manual tracking. For a broader look at managing the timing gap between expenses and collections, see our guide on cash flow management for repair shops.