What is a Purchase Order?
A purchase order is a document that is created by the purchaser or requester.
Purchase orders are used in business to make requests for goods and services from suppliers, vendors, contractors and consultants.
It serves as a means of communication between the two parties involved.
A simplified form of this request may be made through an email requesting information about pricing or availability on specific products offered by the supplier; however some businesses require more detailed specifications before they will enter into negotiations with potential sellers (such as product quality requirements).
What Info is on a Purchase Order?
In every purchase, there is a part where it states what we purchased and how much.
A purchase order (PO) contains all those specifications in an understandable manner for both parties involved to be able to make sure that they have ordered the right thing.
- Name of either the manufacturer or supplier
- Specification on quantity and type of items being bought including brand names if any
- Date by when these goods should arrive at destination point
- Discounts offered such as volume discount, trade credit etc
- Number of units per package with weight also indicated along with shipment details like method used – air freight, courier service, shipping company etc., mode used- door delivery or pick up service etc.;
- Price of goods.
A PO is usually drafted by the purchaser who wants that particular product. The purchase order should contain all relevant information about not just what we have ordered but also how much; when it will arrive at its destination point etc., in understandable terms so there’s no confusion on both parties' end.