Every wholesale invoice carries a payment clock, and small buyers usually meet it as a mystery: why is this supplier 30% deposit T/T, that marketplace net-60, and the domestic showroom CIA? Payment terms are pricing — the seller is either financing you or financing themselves, and the cost is baked into one of the two prices. This guide decodes the standard terms, what they really cost, and the sequence that earns a small account real credit.
The Terms Glossary
| Term | Meaning | Who it favors |
|---|---|---|
| CIA / COD | Cash in advance / on delivery | Seller entirely — the default for new accounts |
| 30% deposit + 70% before shipment | Standard China export T/T split | Seller — goods never ship unpaid |
| Net-30 | Invoice payable 30 days after ship or delivery | Buyer mildly — one month of float |
| Net-60 | Invoice payable 60 days after | Buyer — the marketplace standard on eligible orders |
| 2/10 net-30 | 2% discount if paid within 10 days, else net-30 | Both — the discount is a 36% annualized yield |
| Credit card / PayPal | Instant seller funding at 2.9-3.5% | Buyer convenience; seller pays the fee (or adds it) |
| Letter of credit (L/C) | Bank-guaranteed payment on documents | Large orders only — bank fees eat small carts |
What Terms Actually Cost
Terms are never free; the money moves in one of three ways:
- Price markup: a supplier quoting net-30 typically prices 1-3% above their deposit-T/T price — you are being charged interest inside the unit cost. Always ask both prices; the gap is the loan's APR in disguise.
- Opportunity cost of deposits: 30% down on a $5,000 order is $1,500 parked for 30-45 days of production — for a small shop that is real cash out of open-to-buy budget.
- Platform fees: net-60 on a marketplace is funded by the platform out of its ~15-25% brand commission — which is precisely why direct-import landed cost lands 20-40% below marketplace wholesale for the same product class. The terms feel free because you paid them in the fee.
The 2/10 net-30 discount is the one term that pays you: skipping it costs an effective ~36% annual rate — always take the discount if cash allows.
The Trust Sequence With China Suppliers
New accounts get deposit terms; credit is earned on a visible ladder — the same relationship math as our negotiation playbook:
- Orders 1-2: 30/70 T/T, no negotiation on terms. Pay the balance the day the inspection photos arrive — payment speed is the signal suppliers remember.
- Order 3: ask for 30/70 against copy of B/L (balance when the bill of lading is shown, before arrival) — a small trust step that costs you nothing.
- Orders 4-6: ask for net-15 or net-30 after arrival on reorder volume; expect it to be granted with a modest price step — compare it against the deposit price before accepting.
- Established accounts: consolidated monthly billing across styles — one invoice, one wire, the payment version of the mixed-SKU consolidation that already saves your freight.
Never lead with a terms request on order one — it reads as cash-flow distress, the exact opposite of the reliable-reorder profile suppliers invest margin in.
Terms Discipline: The Buyer's Side
Net terms are inventory debt with a due date, and the failure mode is stacking:
- Cap total net exposure at one month's revenue — the rule from our marketplace guide, applied to direct suppliers too.
- Align the clock to sell-through: a net-60 invoice on slow stock means you pay before the 60-day graduation checkpoint tells you the SKU works. Terms on proven sellers, deposits on tests.
- Calendar every due date in the OTB sheet — payment dates are inventory decisions; a missed net term costs the credit ladder faster than it was climbed.
- Disputes don't stop clocks cleanly: withhold only with written agreement; unilateral non-payment burns the account and the defective-claims path from our QC guide with it.
Deposits, DDP and the Landed-Cost Line
One trap for import buyers: a deposit quote and a DDP quote are different documents — the DDP number includes freight, duty and clearance, while "30% deposit" usually describes goods-only terms. Always restate any terms offer as a full landed cost per unit before comparing suppliers; the price-break tiers only mean something once freight and terms are normalized into the same column.
Valvive's terms are built for the small-buyer ladder: 30/70 T/T on first orders, DDP quotes in writing within 1-2 business days, reorder billing consolidated monthly, and the HS code and fabric specs documented on every invoice — the paperwork trail that makes step three of the trust sequence a formality.