Placing and controlling orders.
WHAT A PURCHASE ORDER ESTABLISHES
What was ordered, at what price, for delivery when.
WHY IT MATTERS
Without it, disputes about what was agreed cannot be resolved.
WHAT TO INCLUDE
Item specification and quantity Agreed price Delivery date and location Terms Your order reference
WHAT TO ESTABLISH
That nothing is ordered without one.
WHY
Verbal orders produce wrong goods and disputed invoices.
WHAT TO ESTABLISH ABOUT AUTHORITY
Who may order, and up to what value.
WHY
Uncontrolled ordering is where money leaves without decision.
WHAT TO MATCH ON RECEIPT
The delivery against the order The invoice against both
WHY THREE-WAY MATCHING
It establishes that what was ordered was received and correctly invoiced.
WHAT TO DO ABOUT DISCREPANCIES
Record them at receipt, and raise them immediately.
WHY IMMEDIATELY
Claims after acceptance are refused.
WHAT TO ESTABLISH ABOUT CONSOLIDATION
Whether orders can be combined.
WHY
Multiple small orders cost more in freight and handling.
WHAT TO BALANCE
Order size against holding cost.
WHAT TO ESTABLISH ABOUT EMERGENCY PURCHASING
That it is recorded and reviewed.
WHY
Frequent emergency purchases indicate planning failure and they cost substantially more.
WHAT TO MEASURE
Emergency orders, by cause.
WHAT TO TRACK
Prices paid over time Orders delivered on time and complete Quality rejections by supplier
