How to Stretch Payables Without Burning Supplier Relationships
When cash is tight, it’s natural to look for places to delay outflow. For many founders, that starts with payables. You see a stack of invoices and a due date approaching—and you wonder if you can buy a little more time without hurting the relationship.
The answer is yes—but only if you do it with intention.
At BBG, I've worked with countless founders, and all the most successful ones know that strong supplier partnerships are the backbone of a reliable operation. But they also know that cash flow isn’t always predictable—like when you're ramping up production or recovering from a slow season.
The goal is to develop a thoughtful approach to stretching payables that keeps your business liquid and your vendors on your side. Here’s how I guide clients through it.
Why Managing Payables Strategically Matters
Accounts payable is a cash flow lever hiding in plain sight. When you extend payment terms strategically, you hold onto your cash longer without increasing your costs. Breathing room can make the difference between a late payroll run and a smooth production week.
The key metric to watch here is days payable outstanding (DPO), which measures how long your business takes to pay invoices after receiving goods or services. A higher DPO can improve your cash position—but only if you're staying in good standing with your vendors.
Let’s say you’re a winery founder who’s always paid vendors immediately—even when your terms are Net 30. It might feel like you’re doing the right thing, but when you look closer at your finances, you realize you’re draining cash earlier than necessary. With a basic scheduling tool or a structured weekly payment cycle, you could align your outflows with your actual obligations and regain a meaningful amount of working capital—without damaging any supplier trust.
Want to learn more? Here's everything you need to know about the cash conversion cycle.
How to Negotiate Better Payment Terms
Most founders assume payment terms are set in stone. But in reality, if you’ve built a good track record and come to the conversation prepared, many vendors are open to flexibility.
Start by understanding what you really need. Are you looking to move from Net 15 to Net 30 across the board? Or do you just need a one-time extension to cover a large production run? The more specific your ask, the easier it is for your supplier to respond.
When negotiating new or extended terms, I coach clients to lead with context, not crisis. For example:
“We’re forecasting higher order volumes over the next 2 quarters and want to align payment timing with our inventory turnover. Would you be open to revisiting our current terms?”
That kind of language signals that you’re thinking strategically, and not just trying to delay payment.
You can also explore options beyond flat extensions:
Partial payments with the remainder due later
Staggered payment schedules tied to inventory sell-through
Volume-based flexibility, where larger orders come with more favorable terms
Let's say you're a CPG founder with a reliable order history and growing volume. If you approach your primary vendor with a clear forecast and propose a quarterly order schedule, they may be open to extending your terms—moving from Net 30 to Net 45, or from upfront to partial payments.
Remember, this is a business discussion, not a personal favor. Treat it that way, and vendors will respect your professionalism.
What to Say When You Need More Time
Even with strong systems, delays happen. Maybe a big customer payment didn’t land on time. Maybe your POS sales dipped unexpectedly. When you know you won’t make a payment deadline, your next move is critical.
I tell founders not to disappear, whatever they do. Transparency and timing make all the difference.
Here’s a simple message structure you can use when reaching out to a supplier:
Acknowledge the invoice:
“Hi [Name], I’m reaching out regarding invoice #456, due on [date].”Be honest about the situation (without oversharing):
“We’re experiencing a short-term delay in receivables, and I wanted to get ahead of it before the due date.”Propose a clear solution:
“We’d like to propose submitting 50% of the payment now, with the balance paid by [new date].”Express appreciation:
“We value our relationship and appreciate your flexibility as we work through this.”
It’s respectful, intentional, proactive, and it keeps the door open for collaboration.
Maybe you’re behind on a payment to your co-packer, and you’re dreading the call. Instead of going silent, you send a respectful message explaining the delay, proposing a partial payment, and setting a date for the remainder. You might be surprised by how often vendors respond with understanding—especially when the message comes early, not after the due date.
Your vendors aren’t mind-readers. Communicating quickly and respectfully helps them plan—and keeps your relationship intact.
Build a Payables Process That Supports Relationships
The strongest vendor relationships I’ve seen are built on consistency. And consistency doesn’t happen by accident—it happens with systems.
If you’re tracking invoices in a Google Sheet and paying whenever someone pings you, it’s only a matter of time before something slips. That might seem like a small miss, but late payments—especially when unexpected—can erode trust.
Here’s what I recommend to clients building out a more sustainable payables process:
Centralize your vendor terms: Keep a master list of vendors, their payment windows, and any special agreements.
Use automated reminders: Most accounting software can flag due dates and suggest payment batches.
Align payables with inventory cycles: Schedule vendor payments based on when you expect to sell or move that inventory—not just when the bill comes in.
Set internal approvals: Even small teams should route invoices through a consistent review process before they get paid.
Picture a small cocktail drink brand trying to manage payables ad hoc—responding to payment reminders as they come in, without a set schedule. Moving to a weekly payment run that’s organized by due dates and approval status can reduce errors, remove unnecessary stress, give vendors more clarity, and open the door to better conversations about terms and timelines. All because you’re working from a system, not reacting in the moment.
For a deeper look at structuring AP, check out our article, How to Manage Accounts Payable Effectively.
Pay Later, Maintain Trust
Stretching payables doesn’t mean ghosting vendors or playing games with your cash. Done right, it’s a sign of financial maturity—a tool to protect liquidity without damaging the relationships your business depends on.
I’ve worked with founders who felt ashamed to ask for more time, only to realize their suppliers had been through the same thing themselves. I’ve also seen founders overplay their hand and lose a trusted partner.
The difference always comes down to how—and when—you communicate.
So, take a look at your current vendor terms. Where are you paying faster than needed? Where could a conversation unlock a bit more flexibility? Where do you need a stronger system to make those conversations easier?
At BBG, we help clients build finance processes that reduce friction and preserve trust. If you’re ready to create a payables system that works for both your business and your vendor relationships, let’s talk.
