There are many ways that a business can rely on their point of sale system. It can handle your inventory, reporting, employee management, CRM and loyalty, marketing, and so much more.
Yet another way that it can help is by facilitating and automating your ordering system. A great POS solution can set automated ordering, manage vendor relations, and set customer par levels, to name a few. It also should be able to create purchase orders, also referred to as stock orders. Below you’ll learn what a purchase order is, how to use it in KORONA, and why it will make running your business so much easier.
What Is a Purchase Order?
A purchase order is an order placed by a business to a supplier with a request for a specified amount of a certain product. The order contains the product title, the number or quantity, the price per unit, and the purchase order number.
Once the purchase order is placed, the sale is official and the business must pay the seller upon delivery of the products in the future.
The retailer gets to place an order for something in the future without having to pay for anything immediately. Meanwhile, the supplier can offer a credit of sorts since the business must pay for the items in full. Suppliers can structure payments however they’d like. Some opt to require payment in full immediately upon delivery, while others offer payment plans over the course of a few months.
Every purchase order comes with its own number. This allows the buyer and supplier to each track the progress of the order and eventual payment.
What Information Is Found on a Stock Purchase Order?
On every purchase order receipt, retailers and suppliers will find the following:
Amount purchased of a certain item
Product title and description
SKU number or specific brand names
Price per unit ordered
Estimated delivery date
Supplier location and billing address
Total amount due
Date upon which payment is due
All necessary information about the order should be contained on the purchase order. This allows retailers to easily track their order history. The order will be automatically stored in your POS system.
Below is a purchase order with KORONA point of sale:
How Do You Use Purchase Orders with a Point of Sale System?
There are many ways to use purchase orders in your POS system. KORONA offers our businesses more convenience and flexibility than any other solution. We design software to adapt to your business, not the other way around.
First, a business decides to place an order for a product or service.
The business sends a purchase order to the supplier electronically through the POS software.
The supplier receives the order and either confirms or denies the ability to fill the order.
Once the order is confirmed, the supplier prepares the order.
Shipment is made with the purchase order receipt attached so the business can confirm that the order is correctly fulfilled.
The supplier sends an invoice with the amount owed for the order.
Businesses must pay immediately or within the time constraints set by the supplier.
Much of this can be automated through your point of sale system. Each product you have in your inventory is tied to the appropriate supplier in the system. Once you place a purchase order for an item, you’ll later be prompted to confirm successful delivery with a stock receipt. This automatically updates your inventory counts with the new order. Below you’ll notice how easy it is to get started with a purchase order:
Businesses can set minimum threshold levels so that the system will automatically place a purchase order when any product gets to a particular level.
KORONA comes with advanced features that analyze past sales based on time period. The owner or manager can specify a custom time period and the point of sale will suggest an optimal quantity to the order. Advanced inventory replenishment such as this, will keep your stock organized and at ideal levels.
Users can also set recurring orders for the same amount in any given period of time. For instance, you could set a standing order of 40 bottles of a certain whiskey to be delivered every two weeks.
Of course, any automation can be fully customized or simply stopped. Users can always manually place orders at any time as well.
Why Get KORONA for Inventory Management?
Purchase orders are just one type of inventory management tool that each of our subscribers can use. When this powerful tool is used in conjunction with dozens of others, you’ll see exactly how much KORONA will change your business for the better.
A great purchase order system will give you much needed accuracy. This will ensure that your store is always well stocked, never out of anything, but also never a glut of any one item. In turn, your cash flow will be more predictable, so you’ll be able to always order what you need. Having too much of an item in stock can lead to reduced storage space and cash on hand, preventing your business from being able to order other essential products for your brand.
Purchase orders also help with budgeting. You’ll have all current orders and their costs queued in the system, so you’ll know exactly how much must be paid at any given time.
And because it can all be automated, you’ll receive the items on time every time. Automated orders guarantee streamlining your communication with suppliers and make business run without any hiccups.
With proper inventory management you’ll see positive results across your entire business. From better cash flow and stock on hand, to less stressed staff members and happier shoppers, you’ll see more profits in no time.
Among other things, Michael writes about trends and tips in retail for KORONA POS. His focus is on bringing small business owners a more holistic approach to growth. In his spare time, you'll find him hiking somewhere in the southwest. Connect with him on LinkedIn.