The Purchase Order Form is one of the Modern Business Practices Today
The use of a purchase order form when placing an order for material or items you need is common place today. It is a form of credit a merchant extends to new and existing customers that generally are placing large orders to maintain their business needs.
In most instances with a new customer, the purchase order form is sent via fax or electronically by email to the vendor so the number on the purchase order and the company’s name, address and other contact information can be verified. Upon receiving the shipment, the news customer also receives a bill that is due within 7 working days.
For established customers of a merchant, they prefer allow for the accumulation of more than one purchase order form to occur before payment is required. This is common when there is more than one order by the customer each billing cycle or month.
This is the common cycle of using a purchase order form for a business to acquire what they need, when they need it without going thru the delay of sending a payment before receiving the merchandise. In most cases the merchandise is sent by courier if the merchant is near the business placing the order.
The use of purchase order form is one of the ways merchants make it easier for a business to make a purchase. This allows for a good business relationship to become established. While the merchants are not banks, this is a form of a credit line that generally does not have any interest charged to the outstanding balances when paid on time.
If previous arrangements have been made, then the purchase order form can also be used for a longer term payment schedule. Instead of interest on the extended credit, many places just add a nominal service charge.
The use of the purchase order form is common place today. There are instances where a business does not pay on time occasionally. It is then up to the merchants to decide if this credit line continuous or payment is required at the time of purchase.