Similar to each Cummins supplier, we continuously assess and improve our finance and procurement processes in order to meet industry standards and maintain a competitive advantage in our markets. To align with this goal, we consistently asses our payment terms, which historically adjust, both here at Cummins and across all industries, based on market strength and supplier performance.
For the past several years, we have maintained a global standard payment term of Net 60 Days (N60). As markets and cash flows continue to improve, we have now implemented a new global payment term standard of Net 90 Days (N90). This change is effective immediately for all new business awards or new contracts, except where differing regional norms or government requirements exist.
While our new N90 terms will affect all new contracts, all existing contracts will maintain their current negotiated payment terms until contracts expire or are due for renewal.
Our commitment to financial excellence applies to both our internal and external stakeholders. This change in payment terms strengthens Cummins’ ability to continue investing in new products, remain competitive in our industry and further invest in our global supply chain.
If you have questions about how our new payment standards will affect you, please contact our Supplier Help Desk at [email protected]. We will soon have all relevant documentation updated to reflect this change.
Thank you for your continued partnership.
Vice President and Chief Financial Officer
Vice President, Global Supply Chain and Manufacturing