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Frequently asked questions about Understanding Purchase Order
When I don't need a Purchase order?

Suppose you have a business, you sell some product or provide some services. So to run your business, you reach out to suppliers, and just pay them and get your products & services immediately. End of story, you do not need a purchase order. As long as you are not placing an order to get the products or services delivered to you in a future date or time, you do not need a purchase order.

What problems you may face during a purchase?

There can be payment issues, supply shortages, miscommunications that lead to incorrect shipments, and scheduling delays. The process of procuring goods can be more complicated and problematic sometimes than described here.

What is the purchase order document?

A purchase order is a document created by a buyer, indicating the items they wish to purchase from a seller. It is an agreement between a buyer and a seller, which includes :

• Buyer info such as phone number, contact person name, address & mail
• Vendor info such as phone number, contact person name, address & mail
• The goods and services they need to purchase from their supplier
• Quantity and estimated Price of the goods and services
• When they need them
• How it has to be transported
• Terms & conditions of purchase
• Credit details such as delayed payment, mode of payment, etc..
Try out CleNet PO Generator to understand better.

Why you should use Purchase Orders?

This keeps business operations efficient and organized. Seller can ensure whether they can provide goods or services before committing tofulfillment. So that buyer can plan how to manage with unavailble goods & services. Also buyer and seller maintain accurate & detailed records for auditing and finacial statement.

Why Purchase Order Generator is a good way to generate Purchase order?

There are a lot of steps involved in generating a purchase order. You may do mistakes while creating a purchase order. Even you may miss some of the required information. Generating Purchase order using CleNet PO Generator,

• reduces human errors
• calculation errors
• spelling mistakes
• saves time
• anyone can create a PO no need for special training
• provide better validation
• improves efficiency
and many more. So avoid creating Purchase Orders manually or using some plain excel sheets.

Is Purchase Order a legal document?

It is the buyer's responsibility to have clear communication with the seller. This eliminates confusion. So buyer has to clearly list out goods & services he want to buy from seller in the PO.

If the seller accepts the PO, it becomes a legally binding contract between the buyer and the seller for that business transactions. The PO does not become a contract until the seller accepts it and the same PO cannot be used for multiple Purchases. The PO Number for each Order should be unique.
Terms and conditions covering all relevant scenarios like : when the buyer can cancel a purchase order, will ensure clear boundaries to maintain good relationships with the sellers.
Some commercial lenders will use POs as legal documents for reference when providing financial assistance to your organization, this is called purchase order financing.
From the seller perspective, if buyers ever refuse payment, the seller remains protected because of the legally binding contract status of the Purchase Order document. For the buyer to have similar protection it is important to have a purchase order confirmation, or acceptance of the order tracked.