Wholesale stockists pay on time when terms are written down before the first order, every invoice carries a payment link, and every account gets one monthly statement backed by a fixed follow-up rhythm. Net 30 is the sensible default; marketplaces like Faire trade margin for carrying the credit risk.
In DTC the customer pays before you ship. In wholesale you ship before the customer pays, and that one reversal is where new wholesale brands quietly lose their cash.
The first big boutique order is a moment.
Someone screenshots it. The team Slack fills up with emojis. A real store, with real shelves, wants your product.
Then 45 days go by. No payment. No reply to your polite email. Just a $1,200 invoice sitting there like a houseplant nobody waters.
Welcome to selling wholesale.
There are a hundred guides on how to sell wholesale: build a line sheet, find stockists, nail your pitch, and decide whether wholesale is worth adding at your revenue stage at all. Almost none of them tell you what happens after the order lands, which is the part where you actually get paid. Or don’t.
So let’s talk about that part. Meet Fernwood, a DTC skincare brand that started selling to independent boutiques last year. Fernwood is an illustrative composite, and its numbers are round on purpose so the math is easy to follow and easy to swap for your own. Forty stockists now. Great products, great reviews, and an inbox full of unanswered payment reminders.
Selling wholesale flips the order of cash: in DTC the customer pays before you ship, and in wholesale you ship first and then wait out the payment terms. That one reversal changes how your whole wholesale business runs, because you are now lending money to every store that carries you.
When someone buys on your Shopify store, the money shows up at checkout. Done.
When a boutique orders, it usually expects terms. Net 30 means it has 30 days to pay after the invoice. Meanwhile, you’ve already paid for the product, the packaging and the shipping.
Your platform can help with the mechanics. If you run Shopify wholesale through Shopify’s built-in B2B features, you can set payment terms from net 7 to net 90 for each company location, and you can schedule payment reminder emails on the due date or once an order is overdue. Useful. But a feature in your admin panel isn’t a collections process. Reminders only go out if someone turns them on, and they can’t tell you that the owner is on a buying trip or that a damaged shipment is holding up the whole account. Somebody still has to make sure the money arrives.
Let’s run Fernwood’s numbers on a single face serum.
The retail price is $40. Standard wholesale pricing is keystone, half of retail, so the wholesale price is $20. That $20 is the boutique’s wholesale cost, and Fernwood’s cost to make the serum is about $8. If you haven’t built your price lists yet, this guide to setting up wholesale pricing and customer groups on Shopify covers the setup side.
Look at the wholesale vs retail price gap from Fernwood’s side. In DTC it keeps $32 per unit before marketing and fulfillment. In wholesale it keeps $12. Wholesale is thinner by design. You trade margin for volume and reach.
That’s fine, as long as the cash actually shows up.
Here’s where it bites. Fernwood’s 40 stockists order about $48,000 a month between them. The rough math for any brand is monthly wholesale sales, divided by 30, multiplied by the average number of days your stockists take to pay. On net 30, paid on time, roughly $48,000 is out in the world at any moment. But Fernwood’s boutiques actually pay in 45 days on average. That’s about $72,000 out at any moment. The extra $24,000 is Fernwood’s money, funding other people’s inventory.
On thin margins, that’s not an inconvenience. It’s the difference between reordering raw materials this month and waiting until next month. It is also why a wholesale brand can look healthy on the sales report and still feel broke, which is exactly why revenue and cash flow tell different stories.
Most late payments come from vague terms rather than bad stockists, so writing the rules down before the first box ships fixes half the problem before it starts. A boutique owner who knows the due date, the preferred payment method and the late policy on day one has very little room to be surprised on day 31.
Net 30 is the sensible default for b2b payment terms with small retailers. When a bigger store asks for net 60, don’t say yes on reflex. Ask what you get for it: a bigger opening order, a guaranteed reorder, or a slightly higher wholesale price. Run the arithmetic from the section above first. Moving one $3,000 a month account from net 30 to net 60 adds roughly another $3,000 to the cash you have out at any moment.
And put the terms in writing before the first box ships. Due date, payment methods, late fee policy. Same terms for everyone unless you have a good reason to bend them.
Boutique owners are busy. They’re running the floor, doing the window display and answering Instagram DMs between customers. If paying you means finding your bank details in a three week old email, it’s going to wait.
Offer the b2b payment methods your stockists already use: bank transfer or ACH, card, and checks for the old school ones. Put a payment link on every invoice. The fewer clicks between “I should pay Fernwood” and “paid,” the faster the money moves.
And say which method you prefer. If card fees matter to you, say bank transfer is preferred. Most buyers will happily follow a clear instruction. They just won’t guess.
Write the consequence down before you need it. A small late fee after a grace period. Reorders paused once an account passes 30 days overdue. Then apply it the same way to your favorite stockist and your least favorite one.
It feels awkward the first time. It feels a lot less awkward than funding someone’s shelf for three months.
Stockists need both documents because an invoice bills one order and a statement of account shows the whole relationship, and wholesale accounts generate far too many small invoices to chase one at a time. This is where most DTC brands get stuck, because in DTC you never needed either.
An invoice is one order, one amount, one due date. Every time a boutique orders, it gets one.
Make every invoice easy to match: an invoice number, the boutique’s purchase order number if it uses one, line items that match what actually shipped, the due date, and how to pay. Boutiques reconcile against their own records, and anything that doesn’t match gets put aside for later.
The problem is that boutiques don’t place one big order a quarter. They reorder small and often. Five serums here, a restock of cleanser there. Across 40 stockists, Fernwood easily has more than 100 open invoices at once. Chasing each one individually is a part time job nobody applied for.
A statement of account fixes that. Once a month, each stockist gets one document showing every invoice, every payment, every credit for a damaged shipment, and the running balance at the bottom.
Think of it like a bar tab. You don’t hand someone a receipt after every drink and ask them to keep track. You show them the tab at the end of the night.
For a boutique owner, a clear customer statement turns a pile of invoice emails into something they can check against their own records in two minutes. If you don’t have one yet, this free statement of account template already includes the transaction table, running balance and remittance section.
A working collections rhythm is the same four moves every month: send statements on the first business day, follow up after a week, call at 30 days, and pause terms for repeat offenders. You don’t need a collections department. You need those four moves on a calendar so they happen whether anyone remembers or not.
Same day every month. Stockists start expecting it, and expected documents get paid faster than surprise ones. Fernwood sends them before lunch on the first business day, so they land while boutique owners are still doing their own month end.
No payment, no reply? Send a short, friendly note that points to the statement. Most of the time, it got buried.
Keep it to three sentences: the balance, the statement attached, and one line asking whether anything looks wrong. Friendly works better than formal here, because you want a reply, not a standoff.
Once an invoice is 30 days past due, pick up the phone before the reorder pause from your written terms kicks in. Email is easy to ignore. A phone call isn’t. Ask if anything on the statement is wrong, then agree on a payment date while you have them on the line. Write down what they promise and when. If the date slips, you’re not starting the next conversation from zero.
If an account keeps slipping, move it to payment upfront until it catches up. You’re not punishing anyone. You’re protecting the stockists who pay on time.
Tell them in plain words, and tell them how to get back to normal terms. Most accounts fix themselves the moment the next shipment depends on it.
A spreadsheet template is enough for a handful of stockists, and dedicated billing software starts to pay for itself once building statements by hand costs you more in hours and errors than the software costs. The tool matters less than the rhythm, so set the rhythm up first and buy software only when the manual version is clearly breaking.
Under about five stockists, a template, a calendar reminder and Shopify’s own payment reminders cover it. Building statements by hand takes minutes, and a dedicated system would cost more than the late payments it prevents.
Somewhere between ten and forty accounts, the manual version starts to crack. Statements take an afternoon, numbers get copied wrong, and nobody is sure which stockist promised what on the phone. This is the point to make sure invoices, payments and statements all come from the same records, whether that is your accounting software or a dedicated system.
Enerpize is one option at that stage: a cloud based ERP for small and medium sized businesses that combines accounting, inventory, HR, sales and CRM. For a brand like Fernwood, the useful part is that statements build themselves from invoice and payment history, so nobody copies numbers into a spreadsheet at month end. Stockists get a client portal where they can see their statements and pay invoices directly, which kills the “we never received it” reply. Payment reminders go out automatically, recurring invoices can run on a schedule for standing orders, and you can take partial payments or set installment agreements for a stockist who needs to catch up. Price lists keep wholesale and retail pricing separate without maintaining two catalogs by hand.
Whatever you choose, weigh it against what you already pay for. If your Shopify B2B setup and accounting software already produce statements, adding a third system is complexity, not progress.
Getting paid is part of the wholesale product, because an order that takes 45 days to turn into cash costs you more than the same order paid in 30. Back to Fernwood.
Same stockists, same products. What changed was the system: written terms, easy payment options, one statement a month, and a follow up rhythm that runs whether anyone remembers or not. In this illustration, average payment time drops from 45 days to about 32. Using the same arithmetic as before, $48,000 a month at 32 days leaves about $51,000 out instead of $72,000, so roughly $21,000 comes back into the bank.
Selling wholesale is a great way to grow a DTC brand. Just remember that the order isn’t the finish line.
The payment is.
A statement of account is a monthly summary you send each customer showing every invoice, payment and credit over the period, plus the balance still owed. It doesn’t replace your invoices. It sits on top of them so the customer can reconcile everything in one place instead of digging through a month of separate invoice emails. For a wholesale brand with many small reorders, it is the single document most likely to get a stockist to sit down and pay the whole balance at once. A free template works for a handful of accounts, and accounting or billing software can generate statements automatically from your invoice and payment records once you have more stockists than you can build by hand.
Net 30 is the standard starting point for a DTC brand selling to independent retailers. Some brands ask for payment upfront on a first order and offer net 30 once a stockist has a payment history with them. If a larger store asks for net 60, treat it as a negotiation and ask for something in return, such as a bigger opening order or a guaranteed reorder. Whatever you choose, put the due date, payment methods and late policy in writing before the first shipment, and apply the same terms to every account unless you have a clear reason to make an exception.
Monthly works for most wholesale brands, ideally on the same day each month so stockists know when to expect it. If you ship high volumes on short terms, every two weeks can make sense, because balances build faster than a monthly statement can keep up with. Consistency matters more than frequency. A statement that always arrives on the first business day becomes part of the stockist’s own month end routine, while one that arrives whenever someone remembers gets treated as optional. Follow each statement with a short note a week later for any account that has not paid or replied.
Net 30 ties up roughly one month of wholesale sales if every stockist pays on time, and more for every day they run late. The quick estimate is monthly wholesale sales, divided by 30, multiplied by the average number of days your stockists actually take to pay. A brand selling $10,000 a month wholesale with stockists paying in 45 days has about $15,000 out at any moment instead of $10,000. Run this number before you agree to longer terms, because the gap is your own cash funding someone else’s inventory, and on keystone margins that can delay your next production run.
Offering your own terms or using a wholesale marketplace is a trade between margin and credit risk. Faire lets eligible retailers pay 60 days later while paying the brand on a payout schedule the brand chooses, and it charges a commission on marketplace orders, with 0% commission on orders from retailers you bring through Faire Direct. Selling wholesale on your own terms keeps the full margin but means you carry the risk of late or missed payments yourself. Many brands use both: the marketplace for discovering new stockists, and direct terms for established accounts that already pay reliably.
