Do I need a payment terms contract for customers?
From a practical point of view, having a mutual understanding of when payments are expected can only be a good thing for your business.
For a small business, cash flow problems can be crippling if customers place orders but pay at a much later date.
If this is a large customer with ongoing bulk orders, it might be an idea to formally set out a payment, discount and interest rate plan to ensure continued business and a good customer relationship.
From a legal point of view, the National Credit Regulator requires credit providers to provide upfront information about the cost of debt, and the timing of payments, before a credit agreement is entered into.
Before selling goods on credit, it would be a good idea to look at all the related obligations of the credit provider.