A purchase order is a document submitted to a materials vendor or, in some cases, a subcontractor committing to the purchase of certain materials or services. Purchase orders usually include descriptions of the items, the quantities to be purchased, and the price of each item. Price can be omitted in cases where the vendor’s pricing fluctuates but is still trusted to be fair by the contractor. It is also standard to include delivery, pickup, or dates of services on the purchase order so that the contractor and the vendor/subcontractor can be aligned with respect to timing.
Also known as: Order
Based on the takeoff work, the estimator believes that 100 units of Part A and 50 units of Part B will be required to complete the job. Once the bid is accepted by the client and the job goes ‘live’, the project manager puts together a purchase order for 100 units of Part A and submits it to the vendor (Part B will be ordered later), noting that she/he will need the part to be available for pickup at 8:00 AM two days later. The vendor accepts the purchase order. The material is picked up at the appointed time, and the supplier bills the contractor at the end of the month (ideally noting the PO number to speed processing!).
Knowify offers a robust purchase order and supplier invoice reconciliation system. You can decide whether or not to include prices on your POs (or just quantities), and you can also include any comments or attachments as may be required. Lastly, you can send your POs to your vendors directly through the Knowify system, saving you the hassle of calling the order in or emailing it from your own email. Using Knowify ensures that no one at your company will ever be confused again about whether a PO has been submitted on an important materials order.