What is the purpose of a purchase order?

A purchase order serves as a formal document issued by a buyer to a seller, which specifies the details of products or services being ordered. The primary purpose of a purchase order is to serve as a unique identifier for material delivery tracking. This allows both the buyer and the supplier to keep accurate records of what has been ordered, the quantities required, and the expected delivery dates.

With a purchase order, businesses can streamline their procurement process since it establishes a clear and legally binding agreement about what is being purchased. This unique identifier helps in tracking the delivery of materials as well, ensuring that there are no discrepancies between what was ordered and what is received, thereby enhancing inventory management and supply chain operations.

While other options might involve aspects of procurement and supplier interaction, they do not encompass the core function of a purchase order as effectively as the role it plays in delivery tracking and identification.