A blanket purchase order represents a framework for an agreement between you and your vendor. Use blanket orders when you have committed to buying large quantities of an item that are to be received in several smaller shipments over a certain period of time. Often blanket orders cover only one item with predetermined delivery dates.
On the blanket order, each separate receipt can be set up as an order line, which can then be converted into a purchase order at the time of ordering.
An example of when a Blanket Purchase Order could be used is when you have a standing order with your vendor to purchase 100 units of an item every month for a year.
Creating Blanket Purchase Orders