How to Write a Purchase Order

Making a Credit Card Purchase

A purchase order is a one-time contract between a buyer and seller. It is written by the buyer and is a legal authorization for the seller to ship the product and bill the buyer. It differs from a contract in that a purchase order is typically for products only, while a contract generally includes labor as well. These documents are used by businesses of all kinds, especially construction and technological firms.

Instructions

1. Start with your company letterhead. If you don't have one, simply add your company name and logo to a blank document. Include basic information such as the company address, and phone and fax numbers. Write the name and contact information of the seller on the form as well.

2. Specify what item you are purchasing. Provide as much detail as possible, including size, color, model number and quantity, if applicable. This helps prevent communication errors and ensures that you will get the correct product.

3. State the agreed-upon unit price, as well as the total price of the entire order. State explicitly whether sales tax or other applicable fees are included.

4. Include payment terms. The purchase order should state whether payment is being made to a credit account, via cash or by another method. It should state how long the purchaser has to pay for the goods received and what interest will apply to late payments.

5. Indicate the date of the purchase order and the date when material is expected to ship. Include shipping methods, if applicable.

6. Have an authorized person from your company sign the purchase order before you send it. The order is not valid until signed by both the purchaser and the seller.