# How do you create a purchase order?

> How to create a purchase order step by step: what to include, where the data comes from, approval, sending it to the supplier and what happens next.

Source: https://www.procol.ai/answer/how-do-you-create-a-purchase-order/
Author: Shivangi Singh, Senior Content Writer (Procol)
Published: 2026-10-17

A purchase order (PO) is the buyer's formal, numbered instruction to a supplier to deliver specified goods or services at an agreed price and terms. Once the supplier accepts it, it is a binding commitment on both sides. Here is how to create one properly.

## What a PO must contain

- PO number and date, and the requisition or contract it is based on.
- Buyer and supplier legal names, addresses and tax identifiers.
- Line items: description, part or SKU, quantity, unit of measure, unit price, taxes, total.
- Delivery address, required date and shipping terms.
- Payment terms and currency.
- Reference to the governing terms and conditions or contract.
- Buyer contact and the authorised approver.

## Steps

1. **Start from an approved requisition** or a contract call-off so the need and budget are already confirmed.
2. **Pick the supplier and price** from the contract or the sourcing result. Do not retype prices.
3. **Fill the line items and terms** above. Check quantities against demand and the delivery date against lead time.
4. **Route for approval** according to value limits.
5. **Send to the supplier** and request acknowledgement. The acknowledged PO is what receiving and accounts payable will match against.
6. **Record it** in your system so receipts and invoices can be matched three ways.

A procurement system does most of this automatically from the requisition and contract. For occasional use, Procol's free [Purchase Order Generator](/tool/purchase-order-generator/) produces a clean PO with your terms and numbering.

## Go deeper

- [Purchase Order Process: A Definitive Guide to Streamlining Procurement](https://www.procol.ai/blog/purchase-order-process/)
- [What is Procure-to-pay (P2P)? An Ultimate Guide](https://www.procol.ai/blog/procure-to-pay/)
- [Explore the Complete Guide to Eprocurement Technologies](https://www.procol.ai/blog/e-procurement/)