To have product to sell in Target stores, Target must purchase inventory from vendors. When they purchase goods from a vendor, the vendor provides Target with an invoice, or bill, stating the details of the goods purchased as well as the cost Target now owes the vendor.

Payment terms state when Target should pay the invoice from vendors as well as any discounts Target is able to take if they pay the invoice early or on time.

For example, if Target purchases $100 of goods from your vendor and the terms are 2%, NET, 65, that means that as long as Target pays the invoice by 65 days from when they received the product (more on this below), they are able to receive a 2% discount and only pay 98% of the cost of the goods, or $98 instead of $100.

For domestic vendors, Target sets payment terms at the merchandising department level. A vendor can have multiple payment terms per vendor ID.

Terms are usually agreed to when a vendor wins business within one of Target's departments.

Let's take a look at how to find your payment terms within Partners Online.

Step 1: Under Apps & Reports, click Vendor Management And Maintenance

Step 2: Click Target Vendor Numbers

Step 3: Click one of your vendor numbers. If your vendor numbers aren't red, meaning they're not a link, contact one of your POL administrators to see if they can give you Limited Update Access in VMM.

Step 4: Click into Dating Terms

Step 5: Check out your terms.

The Day(s) for your terms start counting, in general, from the time Target acknowledges receiving the product they've purchased. This is inconsistently enforced as some vendors are able to count this from the date an invoice is sent, rather than from when Target receives the inventory. Target certainly prefers to start the clock upon receipt of goods, however, so do keep that in mind if you're tracking your payments daily.

You can track your payments in Target's Accounts Payable: Domestic application. Within the Payment Information section of AP: Domestic, you can see your checks and check lines and the associated dates. Payment check lines related to an invoice will list your invoice number in the Document Number column. The Document Date column will tell you when Target is saying they've paid the invoice.

If you don't have a date Target received goods (often the case), use the date your invoice was sent as a gauge of whether or not Target is still within the window to pay or if they're close to or definitely past due, keeping in mind a rough idea of how long it takes orders to arrive at Target's DCs from your warehouses.