Purchase Order Automation: A Key to Efficient Business

18 - August - 2022

In today’s blog, we shall find out what Purchase Order Automation is, and how it turns out to be the game changer for your supply chain mechanism.


Introduction to Purchase Order

A Purchase Order, normally termed a PO, is an official document that is initiated from the buyer’s end in which the buyer shows the commitment to pay the supplier for the given/ stated goods or services.

There’s more than just asserting a commitment to pay – a purchase order clearly explains what you’re buying, how much quantity you require, when you want it to be delivered, the shipping method, and other associated details you might want to add.

This helps you in placing the order beforehand without making immediate payment for the goods or services that you require in the future.

It is a sort of confirmation to the supplier with given terms and conditions that XYZ products will be needed in the future.


What is Automation in Purchase Orders?

Automation in Purchase Order refers to the method of using software to create and automate the purchase order process.

A centralized software is used to create purchase orders, sends them to the approver, and then after review and approval, the PO documents are finally sent to the supplier.

Automation in purchase order includes different aspects, which contain:

- Clear idea of the purpose of creating a Purchase Order

- Proper requirement elicitation process for the required items or services

- Determination/ Forecasting of quantity of goods required

- Delivery time span of receiving goods

- Approval request from the concerned department/ personnel

- Proactive approach in case of any uncertain or unlikely conditions

- Determination of purchasing policies and compliance terms

All these aspects must be measured carefully while we are automating the PO process, or using a software to create a purchase order.


Why Automating Purchase Orders Important?

In this fast-moving corporate world, you can’t just sit back and wait for days to get the purchase order reviewed and approved, and then send it to the supplier.

No mate – you aren’t got time for that.

And that’s where the importance of automated purchase orders bangs in!

Automation allows you to monitor real-time processing. Your team can monitor in which stage the purchase order is, and this allows a collaborative and transparent work environment. Where you do not have to send back and forth emails or messages to get to know the status of purchase orders.

Purchase Order Automation also provides fast-track to get PO approved and send document directly to the supplier without causing delay.

This provides significant time-savings as everything is checked beforehand, so there are minimal chances of discrepancies while checking for the documents and order details.


What are the Benefits of Automated PO Creation?

Let’s check out the benefits of automated PO creation.

✔ Improves Efficiency

✔ Clear Statement of Required Items/ Services

✔ Improved Delivery Time

✔ Document Management

✔ Helps in Making Proactive Decisions

✔ Helps in Budget Forecasting

✔ Streamline Inventory

✔ Swift Payments

✔ Easy in creating invoices

✔ Better Supplier Relationship Management

✔ Better Customer Order Delivery


BusinessBid Purchase Order Module for Automated PO Creation

BusinessBid eProcurement software offers different automated process modules that play major part in supply chain. Among which Purchase Order Module holds multiple useful features and functionalities.

Having said that, let’s learn about those features.



BusinessBid has an entirely separate module for PO. Here’s what you ‘ll get out of PO module:

✔ Title and detailed Description of Purchase Order

✔ Multiple Delivery Address(es) and Delivery Date(s)

✔ Department(s) and Project(s) for which the items/ goods are requested

✔ Standard and Payment Terms and Conditions

✔ Currency in which the PO is created

✔ A list of items having item number, name, unit of measure, quantity, and the price

✔ Additional cost fields are also provided for adding tax or additional charges

✔ List of documents required for PO including Invoice, Packaging list, and certificate of origin

✔ Supplier selection using different input methods: selection from database or inviting external supplier

✔ A wide range of PO operations:

✔ PO Approval mechanism that helps in quick dispatching of PO document to the supplier once it gets approved

✔ The approver might request for changes, accepts or rejects PO to make sure all the provided information is correct

✔ The buyer(host) can see the see the status of the PO, be it pending at approver’s end, approved, or sent to supplier


Final Words

Automating the process of purchase order can bring a lot more ease to your business. Since all the process flow of purchase orders can be monitored and tracked real-time, so there’s less management or mishandling issue of the PO document.

You just have to select the PO, and voila! All the PO history and details would be right in front of you with just a single click.

Spend no more time on just PO thing, we have got it covered for you.

Give this Automated Purchase Order Module from BusinessBid a try, and you will thank us later!

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