Blanket Purchase Order 

Blanket Purchase Order 

A blanket purchase order is a standing purchase order issued to a vendor authorizing the vendor to fill orders for a specific commodity at specified prices for delivery over some period of time.

The use of blanket purchase orders can simplify the procurement process by reducing the number of individual purchase orders that need to be processed. In addition, blanket purchase orders can provide businesses with greater flexibility in managing their inventory levels since they can place orders as needed rather than having to maintain large inventories of supplies.

There are some disadvantages to using blanket purchase orders, including the risk that prices may increase over the course of the contract period and that vendors may not be able to meet the demand if orders increase unexpectedly. businesses should carefully consider whether a blanket purchase order is right for them before entering into any contract with a vendor.