Want to know how to draft a purchase order? Learn how to buy an order sample for yourself, with the help of this article.
A purchase order is a document which shows intent on the part of the buyer to buy certain products which the seller has to offer. It is like a shopping list of things you intend to buy from a particular seller. Except, instead of shopping for it yourself, you send the purchase order containing the list of things you wish to buy, to the seller.
About Purchase Order
It can be understood that a purchase order is a list of goods, sent by the prospective buyer of those goods to the person offering them for sale. It is used for accounting purposes as one of the supporting documents to a contract. Hence a purchase document may have an importance from the point of view of paying income tax to the IRS.
In several situations, it can signify an intent to buy or enter into a contract with the seller. It is an overt show of interest in creating a legal relationship between the buyer and the seller by offering to buy the goods placed on sale by the seller. It can thus be constituted as an offer to buy the goods which, based on the situation and the laws of the land, can amount to a legal contract between the buyer and the seller. All of which proves that the purchase order is an exceedingly important document and not one to be taken lightly.
It is printed with the name and the logo of the company on the top of the page (often on a letterhead). The purchase order gives the name of the dealer to which it is addressed, and the details of the products that are being asked for. It also gives the catalog price of the articles as given by the seller and the estimated total that the goods ordered would come to.
A purchase order needs to be well drafted, easy to understand and should leave no margin for error or misunderstanding. It needs to give the exact specifications of the products being asked for and should not be vague or ambiguous. The seller can call back for clarifications in case the details given are unclear, but then it becomes difficult for the seller to keep calling the buyers every time, if the purchase order is unclear. Hence it is always a good practice to draft it in a way that is easily comprehensible to the seller, and leaves no room for doubt.
Here’s a sample template to make things clearer for you.
With the help of this article, I hope I have been able to properly elucidate the importance of the purchase order and its proper format.