Distribution Company

Smart Credit Terms The Problem

82-day DSO with blanket 30-day terms for everyone The Minor Change: Segmented terms based on actual payment history (2/10 net 15 for fast payers, net 15 for slow payers) The Result: DSO improved from 82 to 58 days, improving cash flow by $450,000

Early Invoice Incentive The Problem

70-day DSO with consistent late payments The Minor Change: Introduced a 2% discount for invoices paid within 10 days The Result: Average payment time dropped to 45 days, boosting liquidity by $320,000 and strengthening customer relationships through timely settlements.