Journey #4 - Get Paid or Get Lost

The Hilarious Guide to Payment Term in Logistics

4/14/20233 min read

Are you tired of scratching your head when it comes to payment terms in logistics? Do you feel like you need a translator to understand what your clients or vendors are talking about?
Well, fear not! We've got you covered with this hilarious and easy-to-understand guide to payment terms.

Let's start with the basics: what is a payment term? Simply put, it's the agreed-upon timeline for payment between two parties in a transaction. Sounds simple enough, right? Wrong. Payment terms can get pretty complicated, and if you're not careful, you might end up losing money or even your sanity.

So, without further ado, let's dive into some of the most important payment terms in logistics, and what they really mean.

1. Net 30

This one's pretty straightforward. Net 30 means that payment is due 30 days after the invoice date. It's like telling your client, "Hey, I trust you enough to give you 30 days to pay me, but don't you dare forget! "

Example: Let's say you provide logistics services to a client on January 1st. The invoice date would be January 1st, and payment would be due by January 31st.

2. COD

No, we're not talking about fish. COD stands for "cash on delivery", and it means that payment is due at the time of delivery. It's like saying, "I don't trust you at all, so give me my money now, or else!"

Example: You deliver a package to a client, and they pay you in cash on the spot


A letter of credit is a payment term that guarantees payment to the seller from the buyer's bank. It's like saying, "I don't trust you, but I trust your bank, so they'll pay me instead."

Example: You provide logistics services to a client who has agreed to use an L/C. The client's bank guarantees payment to you upon completion on the agreed-upon services.


Prepaid means that payment is made in full before the services are rendered. It's like saying, "I don't even know you, but you're not getting anything until I get paid."

Example: A new client wants to use your logistics services. You require payment upfront before you start working with them.

So, there you have it! These are the top 5 payment terms in logistics that you should know. Hopefully, this guide has helped you understand them better and made you laugh a little along the way. But, If you want to dive deeper into the logistics world, make sure to check out my other post for more insights.

Remember, getting paid or getting lost is the name of the game, so stay informed and stay ahead.


Payment in kind is a payment term that involves payment being made with goods or services instead of cash. It's like saying, "I don't have cash, but I have this other thing that I can give you instead

Example: A client pays you for your logistics services with products from their business, instead of cash

Don't miss the next chapter!