If a client up-front with me and tells me that they will be late paying, then I'll usually happily give them extension. The problem occurs when clients ignore the invoice, or think that they can get away with paying it at their leisure (whenever that may be).

In practice, my clients have either negotiated better contracts paid on time (I've not had an issue with any client who's negotiated); or paid up the original amount as soon as I mentioned activating this clause.