The Customer Purchase Order

Sales often begin when a customer presents a purchase order to the seller. The customer's purchase order represents an offer to purchase goods at the price listed on the PO - and subject to all of the terms and conditions included on the PO including the "boilerplate" language that often appears on the back of the purchase order.

Care must be taken to either:
(a) Read, evaluate, accept and follow the instructions and conditions set forth in the PO or
(b) Require the seller to amend the purchase order in writing.

A certain percentage of customer payment deductions (in some companies a significant percentage of deductions) are a direct result of a lack of attention to price and terms and conditions listed on customer purchase orders. From the customer's perspective, a failure on the part of a supplier to carefully review and comply with the PO terms and conditions (or reject and return the PO) results in a deduction that the customer feels that it is entirely justified in taking.

Some suppliers require that all orders be accompanied by a hard copy PO. Others limit this requirement to larger dollar orders. Without a hard copy PO on file, the seller has no way to prove that the prices and terms of sale There are many different terms of sale or payment, ranging from prepayment of cash to permitting the customer considerable time within which to pay for the goods after received. shown on the company's invoice Document which shows the terms of a sale. Includes a full description of the goods, sale price, charges, and discounts. are identical to those quoted to the customer. This can become fertile ground for customer deductions and withheld payments.