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What is the benefit for sellers to offer cash discounts?

While not all businesses are in a position to offer a cash discount to their customers, if you’re able, there are a lot of benefits.


1. Increased cash flow

Instead of waiting 30 days for payment, offering a discount increases the odds of getting paid in 10 days or less. Early payment means better cash flow for your business, and the discount rewards your customers who pay early.


2. Eliminate the need for follow-up

If you currently sell to customers on credit, you know that part of the process involves following up on past due accounts, mailing additional invoices, making phone calls, and sometimes even getting a collection agency involved.

While offering a discount doesn’t eliminate the possibility of your accounting clerk having to do any of those things, it does reduce the occurrence.


3. Encourages customers to pay their bills

Everyone likes a discount, even if it’s just a few dollars. Giving your customers a cash discount will likely motivate them to pay early, or at the very least, on time.


4. Builds customer loyalty

If you’re just beginning to build your business clientele, you know how hard it is to attract and keep good customers. Providing a few perks can help you grow your customer base and keep them coming back to buy the products or services you offer.

While not all businesses are in a position to offer a cash discount to their customers, if you’re able, there are a lot of benefits.


1. Increased cash flow

Instead of waiting 30 days for payment, offering a discount increases the odds of getting paid in 10 days or less. Early payment means better cash flow for your business, and the discount rewards your customers who pay early.


2. Eliminate the need for follow-up

If you currently sell to customers on credit, you know that part of the process involves following up on past due accounts, mailing additional invoices, making phone calls, and sometimes even getting a collection agency involved.

While offering a discount doesn’t eliminate the possibility of your accounting clerk having to do any of those things, it does reduce the occurrence.


3. Encourages customers to pay their bills

Everyone likes a discount, even if it’s just a few dollars. Giving your customers a cash discount will likely motivate them to pay early, or at the very least, on time.


4. Builds customer loyalty

If you’re just beginning to build your business clientele, you know how hard it is to attract and keep good customers. Providing a few perks can help you grow your customer base and keep them coming back to buy the products or services you offer.


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