Purchase Orders Software Definition

A purchase order (PO) is a commercial document and first official offer issued by a buyer to a seller, indicating types, quantities, and agreed prices for products or services. It is used to control the purchasing of products and services from external suppliers. A PO is generated usually after a sales quotation has been approved, and it becomes a contract between the buyer and seller once it is accepted.

Purchasing software helps automate the creation of POs. By automating the process, organizations can improve accuracy and efficiency while reducing errors and costs associated with manual data entry. The software can also help track supplier performance, monitor spending, and manage vendor contracts.