The customer always pays late: is it worth continuing to supply them?

In brief: a customer who always pays a few weeks late, but does pay, is not the same situation as one who is stopping payment altogether — but it is not free either: every day of delay is an implicit financing cost that you bear, not the customer. Whether to keep supplying them, and on what terms, depends on whether the delay is stable or getting worse, and on how much margin it leaves you relative to the cost of that delay.

The hidden cost of a "stable" delay

A customer who regularly pays 20-30 days after the agreed terms is, in effect, financing itself at your expense: that capital — goods delivered but not yet collected — is not available to you in the meantime. If the margin on the supply comfortably covers this implicit cost (capital tied up, any reliance on a bank credit line to bridge the cash gap), continuing can remain worthwhile. If the margin is thin, the same delay can make the supply, in effect, loss-making — even if the customer always pays in the end.

Stable or worsening: the question that matters more than the delay itself

A constant 30-day delay for two years, with no other warning signals, is a commercial fact on which to build stable terms (a price that incorporates the cost of the delay, or an explicit request for a reduction). The same 30-day delay, if it has grown from the 10-15 days of a year ago, or is accompanied by other signals (protests, a worsening balance sheet, a change of director), is a different pattern — a possible early warning of a more serious problem, not just a consolidated payment habit.

The practical options, beyond the black-and-white "continue or stop"

• Revise the price or terms to explicitly incorporate the cost of the usual delay, rather than absorbing it without saying so.
• Reduce the credit period for new orders, keeping the customer but limiting the additional exposure.
• Require a deposit on new orders, especially if the pattern of delay is worsening.
• Continue unchanged, if the margin amply justifies the cost of the delay and the pattern remains stable over time.

When to really stop

The practical threshold is not a number of days of delay in the abstract, but the point at which the implicit cost of the delay (financial, management, risk) consistently exceeds the margin that customer generates — or the point at which the pattern stops being stable and starts worsening alongside other signals. At that point, continuing to supply without changing anything is not commercial prudence: it is accepting rising risk without compensation.