Pricing & margins beyond Amazon
Amazon pays you on a fixed rhythm whether or not anyone chases it. A retailer pays thirty days after an invoice, unless their accounts payable runs on the fifteenth, in which case it is forty-two days, and unless somebody has to approve it first, in which case it is longer. That is the practical difference, and it is less about the number of days than about who is responsible for making the money move.
For a brand that has only ever been paid by a marketplace, learning to be paid by companies is a genuine operational change. Nobody sends you an invoice template when you get your first purchase order.
How the Amazon rhythm actually works
Your disbursement runs on a set cycle, and what arrives is what settled during the period minus fees, minus refunds, minus a reserve held against returns and claims. New accounts and accounts with performance issues carry a larger reserve for longer.
Three characteristics matter for planning.
It is automatic. No invoice, no chasing, no relationship risk. The money is either there or Amazon has a stated reason.
It is net of everything. You do not receive revenue and then pay fees. You receive what is left, which is why sellers routinely overestimate their cash position from a sales dashboard.
It is lagged and partially withheld. The reserve means a share of what you earned this fortnight lands later. Sellers forget the reserve exists until it changes.
Against that, the wholesale rhythm looks alarming at first and then becomes more predictable than the marketplace once you have a handful of accounts with known behaviour.
What net thirty means in practice
Net thirty means payment is due thirty days from the invoice date. The invoice date is the date you raised it, which is why raising it the day you ship rather than at month end is worth actual money.
Real payment behaviour varies by buyer type.
Independent specialty shops often pay on or near the due date, sometimes early to take a discount, because one person handles the money and they want the relationship to work.
Regional chains pay on a cycle. If their run is on the first and the fifteenth, an invoice due on the twentieth gets paid on the first of the following month. That is a structural eleven days nobody is doing on purpose.
Distributors frequently want net sixty, and they will deduct for anything mismatched: a quantity discrepancy, a missing purchase order number, a shipment that arrived outside the delivery window.
Large retailers pay on their own terms and take deductions you will need to dispute. Treat chargebacks and allowances as a normal part of doing business with them rather than as a failure.
The marketplace equivalent of this variability is the Amazon Business side of your own selling, where invoicing and terms already exist for you as a seller. If you have taken purchase orders through that route, Amazon Business net terms covers how they work and what they cost.
The arithmetic of terms as a price
Terms are a discount, and pricing them helps you decide what to offer.
Take an invoice for three thousand dollars. If money is worth something to you, whether because you are borrowing or because you could be buying inventory with it, thirty days of delay has a cost. Even at a modest cost of capital it is a few tens of dollars per invoice. That is small.
What is not small is the volume version. If you are carrying forty thousand dollars of receivables on thirty-day terms across a dozen accounts, that is forty thousand dollars of your money sitting in other people's businesses permanently, because as one invoice is paid the next one is raised. It is not a cost, it is a fixed capital requirement, and it grows in direct proportion to your wholesale revenue.
That is the thing to plan for: wholesale growth consumes working capital at a steady, predictable rate. Doubling wholesale revenue doubles the money stuck in receivables. The full cycle view is in Amazon seller cash flow.
Against that, an early payment discount of two percent for payment within ten days is expensive as a rate and cheap as a tool. On a three thousand dollar invoice it costs sixty dollars to get paid three weeks earlier. Offer it, and many accounts will take it because their bookkeeping is configured to.
Getting paid without becoming a collections department
Most late payment in small wholesale is administrative. Somebody filed the invoice wrong, or the purchase order number is missing, or the email went to a person who left. The fixes are boring and they work.
Put the purchase order number on everything. The invoice, the packing slip, the carton label, the email subject line. An invoice without a purchase order number sits in a pile.
Send the invoice to accounts payable, not to the buyer. The buyer chooses products. They rarely pay for them, and forwarding is not their priority.
State the terms on the invoice itself. Due date as a date, not as a number of days. "Due 14 October" gets paid before "Net 30".
Confirm receipt of the goods. A short email when the shipment is delivered starts the clock in their system and catches problems while they are cheap to fix.
Set a credit limit per account. Two open invoices at a time for a new account is a reasonable rule. It caps the damage and it prompts the conversation before the third order rather than after.
Follow up on a schedule. A polite note three days after the due date, a phone call at ten days. Doing this consistently, for everyone, keeps it from feeling personal.
The document side of this, including what a proper invoice needs on it, is covered in Amazon Business invoices.
Running both rhythms at once
The useful realisation is that the two cash streams complement each other rather than compete.
Marketplace payouts are frequent, automatic and moderate. They are good at covering recurring costs: the monthly bills, the advertising spend, the salaries. Wholesale receipts are lumpy and larger, which makes them good at funding the next factory order.
Brands that run both well tend to do something simple: they treat marketplace payouts as operating cash and wholesale receipts as production cash, and they keep them mentally separate. It stops a good month of purchase orders from being spent on advertising, and it stops a slow wholesale quarter from disrupting the marketplace business.
The other habit worth building is a simple receivables list: account, invoice date, due date, amount, paid. A spreadsheet is enough for the first twenty accounts. Not having one is how a brand discovers in March that a shop has owed it money since November.
If you are deciding which buyer types to pursue first, payment behaviour is a legitimate criterion alongside volume, and the routes differ considerably. Paste your listing into WholesalePilot and the preview shows which kinds of retailers and distributors stock comparable products, which is the starting point for deciding whose terms you want to live with.
Questions sellers ask about payment terms
Should a first order ever be on terms? Rarely. Prepayment by card for an opening order is normal in specialty retail, and moving to terms on the second or third order is a reasonable way to reward a real account.
What if a buyer insists on net sixty? Price it in or decline. Net sixty from a small account with no history is a risk with no compensation attached.
Do I need a credit application? For anything substantial, yes. Company details, trade references and a signed acceptance of your terms is enough, and asking marks you as a professional supplier rather than an amateur.
Is factoring worth it? It converts receivables to cash at a cost. Worth considering when growth is genuinely constrained by working capital rather than by demand.
How do Amazon reserves affect this? They lengthen your marketplace cycle in a way that is easy to forget. Check what your reserve actually is before assuming payouts will cover a factory deposit.