How to make a purchase order
- Add your business name, address and contact details; the address doubles as the delivery address unless you note another.
- Give the order a PO number and set the order date and the delivery date you need.
- Add the supplier’s name and address.
- List each item with the quantity and the agreed unit price. Add tax if the supplier charges it.
- Put terms in the notes, like payment terms or “deliver to the back door before 10 AM”.
- Download the PDF and send it to the supplier to confirm.
What is a purchase order?
A purchase order (PO) is the document a buyer sends a supplier to place an order: what you want, how many, at what price, and when and where to deliver it. Once the supplier accepts it, it’s your agreed order, and it’s what you check the delivery and the supplier’s invoice against.
Purchase order vs invoice
| Purchase order | Invoice | |
|---|---|---|
| Sent by | The buyer (you) | The supplier |
| When | Before delivery, to place the order | After delivery, to ask for payment |
| Purpose | Says what you agreed to buy | Says what you owe |
When the invoice arrives, match it to the PO and to what actually arrived before you pay. Selling as well as buying? Use the free invoice generator.
Do small shops need purchase orders?
Not always, but they help as soon as you buy from more than one or two suppliers. A PO gives you a written record of the price you agreed, makes it easy to spot short or wrong deliveries, and shows what’s on order when you plan stock. Our guide to buying wholesale covers suppliers, minimum orders and reorder planning.
Frequently asked questions
What is a purchase order?
A document a buyer sends a supplier to order goods: what, how many, at what price, and when and where to deliver. Once the supplier accepts it, it’s the agreed order.
What should a purchase order include?
A PO number, the date, your details, the supplier’s details, each item with quantity and unit price, the total, the delivery date and address, and payment terms.
What’s the difference between a purchase order and an invoice?
The buyer sends a purchase order to place the order. The supplier sends an invoice to ask for payment.