Does Net 30 mean 30 business days or calendar days?

Net 30 means 30 calendar days from the invoice date, not business days, unless you explicitly state otherwise. To avoid any ambiguity, many contractors print the actual due date on the invoice in addition to the term.

Is Net 30 good for small contractors?

Usually not for residential work. Net 30 ties up your cash for a month and raises the odds of late payment. Due on Receipt or Net 7 to Net 15 suits most small trade businesses better. Net 30 makes sense mainly for commercial clients who require it.

When does the Net 30 clock start?

From the invoice date. That is why sending the invoice promptly after the job matters — every day you delay invoicing is a day added to when you actually get paid, on top of the 30 the client already has.

Net 30 Payment Terms Explained

What Net 30 actually means

Net 30 means the full balance of the invoice is due within 30 calendar days of the invoice date. The word "net" signals that the full amount is owed with no early-payment discount built in, and the number is the count of days the client has to pay.

So an invoice dated 1 June with Net 30 terms is due 1 July. The clock starts from the invoice date, not the date the client opens the email or the date the job finished — which is exactly why dating and sending invoices promptly matters so much.

You'll see the same convention across the board: Net 15 is due in 15 days, Net 7 in a week, and Due on Receipt means payment is expected as soon as the invoice arrives. Occasionally you'll see something like "2/10 Net 30," which means a 2% discount if paid within 10 days, otherwise the full amount in 30.

Where Net 30 comes from — and why it persists

Net 30 is a holdover from commercial trade. Large companies run accounts-payable departments that batch and pay invoices on a cycle, and 30 days fits that rhythm. If you do work for a property management firm, a general contractor, or a municipality, Net 30 may not be a courtesy you're offering — it may be the only term they'll accept.

The trouble is that Net 30 has leaked into residential work where it makes far less sense. A homeowner doesn't have an accounts-payable cycle. Giving a homeowner 30 days to pay doesn't match any process on their end — it just gives a forgotten invoice a month to gather dust, and gives you a month of float you have to finance out of your own pocket.

The cash-flow cost of generous terms

Every day between finishing a job and getting paid is a day you've financed the client's materials and your crew's wages yourself. On Net 30, you might pay your supplier and your technician weeks before the money comes in. Do that across several jobs at once and you can be profitable on paper while completely out of cash — the classic squeeze covered in contractor cash flow management.

There's also a behavioural cost. The longer the window, the more likely the invoice is paid late or forgotten entirely. A 30-day term frequently becomes 45 in practice, because nobody pays a Net 30 invoice on day 2. Shorter terms create a clear, near expectation and get money in faster.

What terms should you actually use?

For most residential trade work, default to Due on Receipt or Net 7. The work is done, the client is happy, and there's no reason for a long delay. For larger residential jobs, a deposit up front plus the balance Due on Receipt protects your cash flow on both ends — see how much deposit a contractor should ask for.

Reserve Net 30 for established commercial accounts that genuinely run on AP cycles — and even then, ask for a deposit on large jobs and consider an early-payment discount to pull the money forward.

Whatever you choose, the term has to be agreed before the work starts and printed clearly on the quote and the invoice. Fieldpaid lets you set default terms, shows the due date on every invoice, and automatically chases anything that runs past it — so shorter terms actually get enforced instead of quietly drifting.

Net 30 Payment Terms Explained (And Why Contractors Should Think Twice)