Processing Purchase Orders

The purchase order is a cornerstone of purchase management functionality in the program. In principal, a purchase order can be used to register both a physical and financial transaction. Purchase orders can be created manually or generated from Purchase Quotes and Blanket Purchase Orders.

The program offers flexibility in creating orders in all aspects. These are described below.

Generating Purchase Orders from Quotes and Blanket Orders

Purchase Quotes: A purchase quote is typically created as a 'draft order' in which you can register the vendor's specifying price, terms of sale, and description of items. Similarly, where there is a need to replenish items on stock, inventory managers may send a request to the purchasing department, where a quote is created. If the quote is accepted, it can be converted into an order.
Blanket Purchase Orders: A blanket purchase order represents a framework for an agreement between you and your vendor. Blanket orders are typically created 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.

Creating Purchase Orders Manually

Purchase orders can be created manually on the Purchase Order window.

Prepayments on Purchase Orders

A prepayment is a payment made for an order. Usually the payment must be made before the order is processed. This often happens if the goods are custom made or require cash payment. Once a prepayment has been set up on a purchase order, you can create a prepayments invoice for the amount to be prepaid on the purchase order.

Drop Shipments

A drop shipment is the shipment of an item or a consignment of items from your vendor directly to one of your customers.

When you create drop shipments, you must create a purchase order that links to a sales order. The purchase order can be created directly or indirectly. Even though the sales and purchase transactions of the drop shipment are registered in the program as any regular order, the drop shipped items do not physically enter your inventory.

Posting Purchase Orders

When you have completed all the lines and entered all the information on the purchase order, you can post it; that is, create a receipt and an invoice. The Qty. to Receive and the Qty. to Invoice fields on a purchase order represent the quantities that the posting function will process. The values in these fields are filled in automatically by the program at the time when the quantity is entered in the Quantity field for a purchase line.

Partial Receipts

If necessary, the quantities in the Qty. to Receive field can be reduced prior to posting, thereby partially receiving the order.

An order can have as many receipts as are necessary to complete the order. Upon partial order posting, the Quantity Received field will specify the completed portion of the order.

Note

Partial receipts can be invoiced by reducing the quantity in the Qty. to Invoice field prior to posting.

Receiving into the Warehouse

Receiving is the first stage in the inbound warehouse flow, and the released purchase order is a request to the warehouse to expect arrival of items. As soon as the warehouse employee posts the receipt, the items become part of inventory available for sale, but not yet ready for picking. When the warehouse receipt is posted, the program creates a put-away document. (a put-away document is an instruction to the warehouse personnel to move received items from the receiving area to the storage area) The put-away document can then be registered, and the items are available for picking.

If your location uses both put-away processing and receive processing and you have deleted put-away lines, or if you use directed put-away and pick and have decided not to use the put-away worksheet, you can create or recreate put-away instructions for posted receipt lines.

Batch Posting

If you need to post a large number of purchase documents, you may consider batch posting the documents rather than posting the documents one by one.