With annual inflation at 8% (and rising), waiting 90 days for payment costs you 2% of the purchasing power that money provides.
Don't get pushed around by companies who "require" 90+ day payment terms for you to do business with them. I once asked a customer- “are you writing out a check by hand and sending it by stagecoach?”. Stick to your standards.
Some customers are happy to contract 30 day terms but then always pay late. Once a payment goes past due on a chronically delinquent account, describe the process that will occur on successive delays (e.g., late fee at 15 days delinquent, preparation to stop work / deny access at 30 days, actual stoppage applied at 60 days, etc.). In an environment of record high corporate cash balances and ubiquitous use of electronic payments, there's no excuse for consistently late payments.
Other strategies to keep in mind:
In situations where you decide to agree to longer payment terms, use larger upfront payments to mitigate the cash flow risk.
Notify your client operations contact on delinquency issues and obtain their assistance to solve the problem.
“% on-time payments” is a perfectly appropriate KPI for relationship governance.
