A purchase order (PO) process is crucial to any business operation, as it’s a document that serves as an official confirmation of a purchaser’s order from a vendor. It authorizes the purchase and indicates the details of the order, such as the name of the products, their description, quantity, price, and all other information that’s needed to complete the purchase.
POs can come in small or large quantities, and a buyer can rely on several companies like MRKT Capital that offer purchase order funding for requests that are larger than usual. To ensure a smooth PO and receiving process, here are some tips for an efficient and successful operation:
Hire a Purchase Manager
Not all businesses have the luxury of adding this position to their team. Assigning one person to handle your POs, however, will reduce the risk of duplicating orders and help you build stronger relationships with clients. You can start with one person and move on to hiring an entire purchasing department once your business grows.
Implement Strong Purchasing Policies
No matter how small your business is, you must have purchasing policies that will include the following:
- Who are authorized to make purchases for the company
- How to handle legal issues
- The limit of dollar spend per purchase that doesn’t require approval
Switch to an Electronic Process
Paper purchase orders involve quotes, packing slips, and other notes that can lead to document overload. You can have all these saved and organized electronically to make your process faster, easier, and have fewer errors.
Implement Strong Receiving Policies
Whoever is assigned to manage your processes must make sure that clients receive what they ordered on time and that they’re not damaged. Invoices must be collected and return policies should be known in case they’re needed.
Having a streamlined purchasing process can help meet customer demands faster which, in turn, promotes customer loyalty and higher profitability. Follow the above-mentioned tips and you’ll achieve all these in no time.