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Credit Card, COD, Net30

by crediblezephyre
3 replies
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I have a potential supplier on the hook who is asking how I want to pay for products.

Credit Card
COD
Net 30

I'm not super clear on what all of these are. I was hoping to do dropshipping... am I missing something? Is one of these basically drop shipping?

I know COD is cash on delivery. I assume that is delivery of inventory to me? or does that generally refer to allowing customers to pay cash on delivery.

Net 30 means you pay the whole net at the end of 30 days? I believe this is as close as I can get to drop shipping but I'm going to need a credit line to pull this off right?

Credit Card means... I pay for it on a credit card? or buy inventory? I really don't know this one.

Can someone give me some advice on what might be best for what I'm looking for (low startup investment but still able to sell products).
#card #cod #credit #net30
  • Profile picture of the author violet0176
    Really? Why are you even attempting to do business without knowledge of the most basic credit terms? I'm sorry, but I'm truly shocked by your questions. Why have you done no research? Are you trying to fail? Sorry to say, but some people are very good at sabotaging themselves and then wonder why things never work out, lol.

    I don't know what company you're working with and please PM if you care to give more info. Whether the company is willing to drop ship has nothing to do with your method of payment - at least not in my experience. You can always modify terms.

    If you're paying COD there is always a service fee added on and is due at time of delivery. You have no reason to COD, if drop shipping.

    If you're applying for Net terms, a credit check will be done and unless your credit rating is good to excellent, you will be denied Net terms. If you are approved for Net terms then yes, you can purchase and store inventory immediately and ship the product directly. Payment is due in 30 days whether you make sales or not.

    If you are drop shipping and just starting out, it's smart to pay as you get sales by using your Credit Card/Bank Card which the company will keep on file and charge as you place orders.
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    • Profile picture of the author crediblezephyre
      Originally Posted by violet0176 View Post

      If you are drop shipping and just starting out, it's smart to pay as you get sales by using your Credit Card/Bank Card which the company will keep on file and charge as you place orders.
      I'm pretty sure this is what I was looking for.

      I did research (which turned up little more than definitions for me) but I didn't find satisfactory answers so I turned to the forums to augment my research

      What I couldn't tell is whether these payment terms apply to me or customers. For instance COD... I imagine that's delivery of a purchase of inventory to me, not to customers as I sell 1 by 1.

      Additionally net 30 is simply a promise to purchase a set amount of inventory and pay it off in 30 days (or sooner, going into this isn't necessary)

      Neither of these allow me to drop ship. I can't afford to purchase inventory and I can't guarantee I would sell the products by the end of 30 days which would put me in a really bad place.

      I also assumed "credit" meant "paying for a MOQ shipment of inventory" shipped to me, which again, I can't afford. It's why I'm looking for dropshipping.

      Do credit payment terms mean they will let me pay for products as I sell them one by one? That is what wasn't clear to me but by your answer that is what that means. To me that's essentially dropshipping
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      • Profile picture of the author violet0176
        Originally Posted by crediblezephyre View Post

        I'm pretty sure this is what I was looking for.

        I did research (which turned up little more than definitions for me) but I didn't find satisfactory answers so I turned to the forums to augment my research

        What I couldn't tell is whether these payment terms apply to me or customers. For instance COD... I imagine that's delivery of a purchase of inventory to me, not to customers as I sell 1 by 1.

        Additionally net 30 is simply a promise to purchase a set amount of inventory and pay it off in 30 days (or sooner, going into this isn't necessary)

        Neither of these allow me to drop ship. I can't afford to purchase inventory and I can't guarantee I would sell the products by the end of 30 days which would put me in a really bad place.

        I also assumed "credit" meant "paying for a MOQ shipment of inventory" shipped to me, which again, I can't afford. It's why I'm looking for dropshipping.

        Do credit payment terms mean they will let me pay for products as I sell them one by one? That is what wasn't clear to me but by your answer that is what that means. To me that's essentially dropshipping
        No, its not drop shipping until you set up drop shipping terms with them.
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