Purchase Order Format: Everything You Need to Know

A purchase order demonstrates a customer’s plan to buy from a supplier. It lists the precise things the purchaser needs, such as the items they want and their quantity. Purchase orders also help to protect both parties in case of any problems with payment or delivery.

Since they keep everything organized, these documents are extremely helpful in companies with many people involved in the purchasing process. You can create purchase orders using different tools like Word and Excel. You will also find some readymade templates.


However, some basic guidelines about the purchase order format create a standardized tone for these documents. Read on to discover the typical format for purchase orders.

Components in a Typical Purchase Order Format

Usually, a purchase order will contain the following elements in this particular order:

  • Header:This part is for adding company information like name and address. You will also have to mention the date and number of the PO document here.
  • Supplier Information:It indicates who will receive the purchase order. It should contain the exact name and address of the supplier.
  • Ship to: This part will include the destination of the order. Moreover, it will mention the shipping method and terms. The intended date of delivery should also be present.
  • Order Details:Please ensure that for every item in the purchase, there is a detailed description. It should contain the unique product code or SKU and the name of the item. A brief overview also has to be present. Additionally, mention the number of items needed and the cost per unit. You can also mention the expected arrival date for each individual unit.
  • Summarise:A subtotal must be present at the end of the purchase order format. Shipping costs and taxes should also be present. Moreover, it is important to talk about the applicable discounts. In the end, the purchase order will contain the grand total.

Why Should You Use Purchase Order Templates?

A purchase order template is beneficial for saving time. However, there are additional benefits to utilizing a purchase order template aside from convenience. Purchasers can utilize the purchase order template to track their expenditures more effectively and promptly instead of relying on quarterly reports.

The purchase order is a useful tool for overseeing stock and keeping track of payments. It gives a history of which stock has been sent and what is still in supply to ensure there is always sufficient to meet expected demand. The buying request will also indicate when payment for orders is expected.

It can also assist in preventing errors that could potentially exceed your budget. Every expenditure is meticulously outlined, enabling you to identify and prevent overspending before it negatively impacts your budget.

Ending Note

Purchase orders are typically issued in two copies. One is sent to the seller, and the other is retained by the buyer’s accounts payable department. The buyer keeps a copy to cross-reference with the invoice received from the seller. So, the next time you need a purchase order, use the templates available online for convenience.