What Is A Purchase Order?

A Purchase Order (PO) is a document created by the purchaser and sent to a vendor or supplier in order to confirm an order. The document usually specifies:

• Products you want to buy
• Quantity
• Price per unit
• Delivery details
• Payment terms and condition
• Due date of delivery

Every Purchase Orders have a unique number so both buyer and suppliers can track delivery and payment.

Types of Purchase Orders

There are four types of Purchase Orders, including:

• Standard purchase orders

Standard purchase orders (SPO) are the most used type of purchase order, and the easiest to understand for their simplicity. A SPO is commonly used for irregular or one-off procurement of companies.

• Planned purchase orders

A planned purchase order (PPO) contains similar information as a SPO, but excludes the delivery date and location. The buyer will be incharge of indicating the release dates as the year progresses.

• Blanket purchase orders

Blanket purchase orders (BPO) contain similar information as SPOs, but exclude the product quantity (and sometimes the unit price). A blanket purchase order is used for repetitive transactions.

• Contract purchase orders

Contract purchase orders (CPO) only contain payment terms and conditions, even the product list is excluded from this. In this case, if the buyer wants to purchase items from the supplier, he/she will have to raise a Standard Purchase Order (SPO).

JKA Solutions can help manage your Purchase orders efficiently, visit our website now:
https://jkaservices.com/