Free purchase order templates

Frequently Asked Questions

• What is a purchase order and why do I need one?

  A purchase order (PO) is a commercial document issued by a buyer to a vendor, authorizing a purchase. POs create a legal contract, help control spending, track inventory, manage budgets, and provide an audit trail for accounting.

• What's the difference between a purchase order and an invoice?

  A purchase order is created by the buyer before receiving goods/services to authorize the purchase. An invoice is created by the seller after delivery to request payment. The PO number should appear on the corresponding invoice.

• Are purchase orders legally binding?
  Yes, once a vendor accepts a purchase order, it becomes a legally binding contract. The vendor agrees to provide the specified goods or services, and the buyer commits to paying the agreed amount upon proper delivery.
• What should a purchase order include?
  Include: PO number, issue date, vendor details, ship-to and bill-to addresses, item descriptions, quantities, unit prices, total amount, delivery date, payment terms, and authorized signature.
• Do small businesses need purchase orders?
  While not required, POs benefit businesses of any size by preventing unauthorized purchases, avoiding duplicate orders, tracking spending, simplifying receiving and accounting processes, and resolving disputes about what was ordered.