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Free Purchase Order Template

Updated: 6 days ago

a sample of a purchase order template

How to Get Started:

To get started just download the template below and fill in the highlighted sections. Our templates are fully customizable, allowing you to tailor them to your specific workplace needs.

Whether you're a small business owner or a safety professional, our templates can help you streamline the paperwork


In this Article:


Download Your Free Purchase Order Template Below

Ward Education Ltd - Purchase Order Template
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At Ward, we think paperwork shouldn't cost and arm and a leg. That's why we're committed to providing free resources, to help you keep your staff safe whilst saving precious time and money.

Ever expanding health & safety requirements can put a strain on small and medium size business. That's why we created our Company Documents section, to keep your costs down and ensure you're able to compete in todays market.

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What is a Purchase Order?

A purchase order is a crucial document in the procurement process, serving as a formal request from a buyer to a seller for the purchase of goods or services. It outlines the specifics of the transaction, including item descriptions, quantities, prices, payment terms, and delivery details. This provides clarity and ensures accountability for both parties involved.

Our free purchase order template simplifies this process by providing a standardized format for generating purchase orders quickly and efficiently. By using our template, businesses can streamline their purchasing workflows, minimize errors and enhance communication with vendors. With customizable fields and a user-friendly layout, our template empowers organizations to speed up their procurement processes, ultimately saving time and resources.


How does a Purchase Order Work?

The purchasing process is a fundamental activity in business operations, beginning when an organization identifies a need for goods or services. This need may arise from various factors such as the requirement to replenish inventory, specific project needs, or service requests. Here’s a breakdown of the steps involved:

1. Initiation of Purchase

The process starts when a buyer recognizes a need, which prompts the initiation of a purchasing sequence.

2. Creation of Purchase Order

The buyer drafts a purchase order, which is a document outlining the transaction's details. This document includes descriptions of items, quantities, prices, expected delivery dates, payment terms, shipping instructions and any other pertinent terms and conditions.

3. Approval of Purchase Order

In accordance with the organization's internal guidelines, the purchase order may require approval from authorized personnel, such as managers or department heads, before proceeding.

4. Transmission to Supplier

After obtaining the necessary approvals, the purchase order is sent to the supplier. This can be done electronically or through traditional mail, officially informing the supplier of the buyer's intent to purchase and providing all necessary details to fulfill the order.

5. Acknowledgment by Supplier

Upon receipt of the purchase order, the supplier typically sends back an acknowledgment, confirming they have received and accepted the order. This acknowledgment is crucial as it ensures that both parties agree on the terms of the transaction.

6. Fulfilment of Order

The supplier then fulfils the order by delivering the goods or performing the services as detailed in the purchase order. This step may involve various activities like manufacturing, packaging, shipping, or directly providing the requested services.

7. Receipt and Inspection

When the goods or services are delivered, the buyer conducts an inspection to ensure that everything meets the specifications stated in the purchase order. Any issues or discrepancies found during this phase are promptly communicated to the supplier for resolution.

8. Invoicing and Payment

Following the receipt and acceptance of the goods or services, the supplier issues an invoice to the buyer. The buyer then reviews this invoice against the purchase order to ensure all details are correct before proceeding with payment according to the agreed-upon terms.

9. Record-Keeping

Finally, both the buyer and the supplier maintain thorough records of the purchase order, invoice, and any other relevant documentation. These records are essential for accounting and auditing purposes and help maintain transparency and accountability in business transactions.


a man filling out a purchase order

What Information does a Purchase Order contain?

The information contained in a Purchase Order not only outlines the expectations and obligations of both parties but also serves as a legally binding agreement once it is accepted by the supplier. Properly documenting this information ensures clarity and helps prevent misunderstandings or disputes during the fulfilment process.

These are the key points that must be included in a purchase order:

1. PO Number

A unique identifier for the purchase order, used for tracking and reference throughout the transaction lifecycle.

2. Buyer Information

Details about the purchasing organization, including name, contact information, and billing address.

3. Supplier Information

Information about the supplier or vendor, such as the company name, contact details, and shipping address.

4. Date of Issue

The date on which the purchase order was issued.

5. Description of Goods or Services

A detailed list of the items or services being purchased, including product codes, descriptions, and specifications.

6. Quantities

The quantity of each item or service ordered.

7. Unit Price

The price per unit of each item or service, which may include currency specification if international transactions are involved.

8. Total Cost

The total amount payable, including a breakdown of taxes, discounts, or additional charges if applicable.

9. Delivery Date

The expected date or timeframe for the delivery of goods or completion of services.

10. Payment Terms

Specifics on how and when payment should be made, including payment methods and any instalment details.

11. Shipping Instructions

Instructions regarding how the goods should be shipped, including the mode of transport, shipping terms, and any special handling instructions.

12. Terms and Conditions

Legal and contractual terms governing the transaction, which may cover warranty information, cancellation policies, and penalties for non-compliance.

13. Authorization

Signatures or electronic approval from individuals authorized to commit the purchasing organization to the transaction.


When does a Purchase Order become a Contract?

A Purchase Order (PO) becomes a contract when it is accepted by the supplier. This acceptance can be explicitly communicated through a formal acknowledgment or implicitly inferred if the supplier begins performing under the terms of the PO, such as by shipping the ordered goods or starting the requested services.

This moment of acceptance is crucial because it signifies that both parties agree to the terms outlined in the Purchase Order, making it legally binding. As a contract, the Purchase Order commits the buyer to purchase the specified goods or services under the agreed-upon conditions, and it obligates the supplier to fulfil the terms of the order as detailed.

Thus, understanding when a PO transitions into a contract is vital for both parties to recognize their legal commitments and manage their responsibilities accordingly.


How do you Send a Purchase Order?

The PO can be sent using various methods depending on the company's preferences and the supplier's requirements. Most businesses now favour electronic procurement systems that can automatically transmit the PO to the supplier via email or directly into their procurement system if integrated.

Direct Email

This method is fast, reduces paper waste, and typically provides a record of when the PO was sent and received. Alternatively, POs can also be sent as PDF attachments via email for easy tracking and confirmation of receipt. Less commonly, some businesses might use fax or even send POs via postal mail, particularly for very formal or large transactions.

Confirmation of Receipt

After sending the PO, it is important to confirm that the supplier has received it. This confirmation can be obtained through an acknowledgment email, a return receipt, or direct confirmation from the supplier. If you do not receive a confirmation of receipt, it is advisable to follow up with the supplier to ensure they have received and are processing the PO.

This step is essential to prevent any delays in order fulfilment and to ensure both parties are aligned to proceed with the transaction.


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