Can I negotiate faster payment terms so I don't run out of cash flow? Many sponsor contracts set 90 to 120 day payment timelines. This, however, cripples cash flow for smaller sites. Now you can try to negotiate net 30 or at least milestone-based payments. That means that there's a startup fee paid upon contract execution, quarterly payments regardless of enrollment pace, but the truth is you're not going to get very far with it. Enforcement is just tough. Another tool is an interest-on-late payments clause. So even if you can rarely enforce it, it does act as a way to have companies sort of try to meet timelines. I suggest language requiring sponsors to pay within a set amount of time after invoicing, regardless of whether the CRO has been reimbursed by the sponsor. The leverage point is your enrollment speed. Sponsors will pay faster if you're delivering data. Stronger payment terms stabilize cash flow and reduce the need for credit lines or personal funding to cover payroll. Call, click, or email.
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Episode Transcript
Can I negotiate faster payment terms so I don't run out
of cash flow?
Many sponsor contracts set 90to 120 day payment timelines.
This, however, cripples cashflow for smaller sites.
Now you can try to negotiatenet 30 or at least
milestone-based payments.
That means that there's astartup fee paid upon contract
execution, quarterly paymentsregardless of enrollment pace,
(00:20):
but the truth is you're notgoing to get very far with it.
Enforcement is just tough.
Another tool is aninterest-on-late payments
clause.
So even if you can rarelyenforce it, it does act as a way
to have companies sort of tryto meet timelines.
I suggest language requiringsponsors to pay within a set
amount of time after invoicing,regardless of whether the CRO
(00:40):
has been reimbursed by thesponsor.
The leverage point is yourenrollment speed.
Sponsors will pay faster ifyou're delivering data.
Stronger payment termsstabilize cash flow and reduce
the need for credit lines orpersonal funding to cover
payroll.
Call, click, or email.
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