Purchase Order (PO) Generator
A purchase order is a buyer's formal instruction to a vendor: supply these items, at these prices, by this date, on these terms. Once the vendor accepts it, the PO becomes a binding contract and the reference against which the delivery challan, invoice and payment are matched (the "three-way match" auditors look for). This generator creates a clean PO with your buyer details, vendor details, item table with GST, a ship-to address, delivery date, payment terms and a vendor acceptance box.
Why issue POs even in a small business
- Prevents over-billing — the invoice must match the PO price and quantity.
- Gives the vendor written authority to supply, so there is no "who ordered this?" confusion.
- Creates a commitment register: open POs show you how much cash is already committed.
- Required by most ERP and audit processes before an invoice can be booked.
Essential fields
PO number and date, vendor name and GSTIN, buyer GSTIN and billing address, ship-to address if different, item description with HSN, quantity, unit rate, GST rate, delivery date, payment terms (advance, net 30, against delivery), freight responsibility, and the buyer's authorised signature. Mention "please quote PO number on invoice" — it saves hours during reconciliation.
Worked example
A hospital orders 50 boxes of surgical gloves at ₹480 per box (HSN 4015, GST 12%) and 20 litres of hand sanitiser at ₹310 per litre (HSN 3808, GST 18%). Gloves: ₹24,000 + ₹2,880 GST. Sanitiser: ₹6,200 + ₹1,116 GST. PO total = ₹34,196. Terms: delivery within 10 days, payment net 30 days. When the invoice arrives for ₹34,196 and the store confirms receipt of 50 boxes and 20 litres, accounts can release payment without any further checking.
PO vs quotation
A quotation flows from seller to buyer; a PO flows from buyer to seller and usually references the quotation number. If the vendor's acceptance changes any term, ask for a revised PO acknowledgement so both documents agree.
Frequently Asked Questions
Is a purchase order a legal contract?
A PO is an offer to buy. It becomes a binding contract when the vendor accepts it, typically by signing the acceptance box or by dispatching the goods.
Should the PO show GST?
Yes. Showing the expected GST lets you check the vendor's invoice and budget the full cash outflow.
Can I use a different ship-to address?
Yes. Fill the Ship To field in Details and it prints separately from the billing address.
What payment terms should I choose?
Select from common options such as 100% advance, net 30 or against delivery; the text prints on the PO.
Disclaimer: This tool is for general information and estimation only. Tax rates and rules change — verify with official sources or a professional before acting. Read full disclaimer.