What is purchase orders ?

Definition

In an ideal world, companies would reach out to their usual suppliers, place an order and deftly negotiate contracts to fulfill standard purchases. In reality, though, it's a far more tedious process. If conflicts regarding payment, supplies, and quality weren't enough, relying solely on invoices from suppliers and departmental managers or buyers can lead to a significant increase in expenses and, sometimes, even fraudulent practices. A company growing in size and complexity is all the more susceptible to this. To shield your business and save time and resources, you must streamline the procurement-to-pay process in a way that ensures all purchases are validated and documented. This is where purchase orders (POs) can help. Purchase orders are legally-binding documents the customer sends to a supplier, with instructions to provide specific goods and services within a stipulated period. The document, issued along with an invoice, contains vital information such as the quantity and nature of goods or services required, pricing, delivery location, payment terms, and warranty, and are customizable regarding conditions such as urgency.