ELi5: why do companies have Net 30/60/90 terms?

Question

If when I purchase something I pay for it immediately why do companies/government/orgs after approving a transaction and/or receiving the work take 1-2months to pay for it?

EDIT: I am a new agency owner, so trying to figure out cash flow

EDIT 2: thank you guys so much for the detailed answers! Really helped me further narrow down the kinds of customers I do and don’t want to work with moving forward.

In: 2

Answer 1

Think of it like a store credit card, where you can make a purchase and pay later, but for business.