1%/10 net 30

What does it mean?
A way of providing cash discounts on purchases. It means that if the bill is paid within 10 days, there is a 1% discount. Otherwise, the total amount is due within 30 days.

For example, if "$1000 1/10 net 30" is written on a bill, the buyer can take a 1% discount ($1000 x .01 = $10) and make a payment of $990 within 10 days, or pay the entire $1000 within 30 days.

In Other Words...
Manufacturers offer discounts like this to encourage retailers to pay quickly.

This calculation is the same regardless of what discount is used. For example "2/10 net 30" just means there is a 2% discount.

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Related Terms
Retail Price Index (RPI)

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