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What is PO? PDF Print E-mail
Written by Cecilia Chee, Singapore   
Monday, 03 October 2011 17:08



Purchase order


purchase order (PO) is a commercial document issued by a buyer to a seller, indicating types, quantities, and agreed prices for products or services the seller will provide to the buyer. Sending a purchase order to a supplier constitutes a legal offer to buy products or services. Acceptance of a purchase order by a seller usually forms a one-off contract between the buyer and seller, so no contract exists until the purchase order is accepted.


There are several reasons why companies use purchase orders.

Purchase orders allow buyers to clearly and explicitly communicate their intentions to sellers, and sellers are protected in case of a buyer's refusal to pay for goods or services. Purchase orders also help a purchasing agent manage incoming orders and pending orders. Purchase orders also are an economical choice for a business because they streamline the purchasing process to a standard procedure.

Electronic Purchase Orders

Many Purchase Orders are no longer paper-based, but rather transmitted electronically over the Internet. It is common for electronic purchase orders to be used to buy goods or services online for services or physical goods of any type.




Last Updated on Monday, 03 October 2011 19:40
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