Wholesale
Wholesale Net Terms Calculator
Measure what net-30 or net-60 payment terms really cost, and whether an early-payment discount is worth taking.
Formula
Cost of waiting = invoice amount × annual cost of capital × terms days ÷ 365. Effective cost of paying at term = invoice amount + cost of waiting. Value of paying early = early-payment discount amount + financing saved, where financing saved = invoice amount × annual cost of capital × (terms days − early-payment day) ÷ 365. The early-payment discount is a saving on the invoice; the financing saving reflects the days of funding you no longer need.
How it works
Enter the invoice amount, the payment terms in days, your annual cost of capital, and any early-payment discount with the day it must be paid by. The calculator shows what waiting until the terms day costs, what paying at term effectively costs, and the total value of paying early instead.
Worked example
Invoice $5,000.00, net 60, annual cost of capital 12%, early-payment discount 2% if paid by day 10. Cost of waiting 60 days is $5,000.00 × 12% × 60 ÷ 365 = $98.63. Effective cost of paying at term is $5,000.00 + $98.63 = $5,098.63. Paying on day 10 costs $5,000.00 × (1 − 0.02) = $4,900.00. Financing saved over the 50 days from day 10 to day 60 is $5,000.00 × 12% × 50 ÷ 365 = $82.19. Total value of paying early is $100.00 discount + $82.19 financing saved = $182.19. Interpretation: taking the discount is worth more than the discount alone suggests, because it also removes 50 days of funding cost.
FAQs
What does net 30 or net 60 mean?
Net 30 means the invoice is due 30 days after the invoice date; net 60 means 60 days. The buyer holds the cash until then, and the seller waits for it.
What is the cost of capital here?
It is the annual rate you assign to money tied up in an unpaid invoice — for example, a borrowing rate or the return that cash could earn elsewhere. Enter your own rate; the default 12% is only an example.
Is an early-payment discount always worth taking?
Not always. Compare the discount plus the financing saved with the value of keeping the cash until the terms day. This calculator does that comparison for your numbers.
Why use 365 days in the formula?
It converts an annual rate to the exact number of days in the terms period, so a 60-day wait costs roughly twice a 30-day wait at the same rate.
Does this calculator cover late-payment penalties?
No. It models the planned cost of waiting and an offered early-payment discount only. Any late fee or penalty in your supplier agreement is separate.
Stand: October 2026. Pure arithmetic — no platform rate is used; enter your own figures.
Disclaimer: Results are estimates and general information only, not financial advice. Check your supplier agreement and platform terms before you set a price.
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