An online purchase order system gives you an automated way of creating bulk purchase agreements between your online store and your suppliers, distributors, and manufacturers.
The system simplifies how the stock is ordered in your store, giving you a simple template option for creating a purchase order before it is then sent to your supplier.
You simply need to fill in the item information, quantity, and price, and then you send this to your supplier.
This is a simple and effective approach to order, and it can bring about a number of different benefits, which we will explore in more detail below.
1. Reduce the amount of time spent on the procurement process
The first benefit of using an online purchase order form template is that you can lower the amount of time you spend on the procurement process.
A dedicated purchase order system reduces the time spent on related activities in a number of ways:
- You will spend less time on tracking commitments while doing budget control
- You will reduce the amount of time you spend on invoice processing
- You will not spend a lot of time searching for relevant data because you now have a one-stop shop for all information
- Your secure and digital approval processes will become a lot quicker when compared to your previous manual approach
- You save time because not as many manual data entries are required
2. Data security can be taken to a higher level
Another reason to consider an online order system is that it helps you to enhance data security. You can make the most of digital access control to limit who is able to have access to purchase data, make amendments, and approve order information. This ensures that only the relevant individuals are accessing this sort of information, which is critical.
A lot of the purchase order systems on the market today come with added security measures as well. From two-factor authentication to high-grade encryption, there are many different methods that can be used to keep your information as safe as possible.
Combining these approaches with regular backups is necessary to ensure your business’s long-term future.
After all, it seems that a day does not go by without some sort of report regarding a data breach. These sorts of incidents can derail businesses, with many having to close their doors altogether as a consequence of a data breach.
When a data breach happens, not only do you have to spend money on getting to the bottom of the problem but you face non-compliance fines and compensation payouts. Not to mention that trust in your business will be destroyed, and this can be very difficult and expensive to rebuild. This is why you need to do everything in your power to prevent an incident like this from happening, and moving to an online purchase order system can certainly help to make sure that this is the case.
3. Simplify the internal approval process
Approving purchase orders via paper or email can take a lot of time. Once you have sent an email, you then need to follow it up, and then paper documents can be lost, meaning replacements are needed. This creates a very long-winded process, which can often drag out longer than it needs to.
On the flip side, if you use an online purchase order system, you have a thorough and complete overview of which purchase orders need to be approved and by whom. This speeds up the process. You can also trace the history of an order if you need to do so in the future.
4. Access historic data
As touched upon in the previous section, if you use an automated purchase order tool, you will be able to access historical information about orders. This can prove beneficial in a number of situations, from proving compliance to helping a customer with an order that has gone missing.
You will have a searchable archive, which is basically a database of information. You can search this and quickly get your hands on any of the data you need. Whether you need to gather reports on orders relating to your budget or you need to get information about how much you have ordered from a specific vendor, you will be able to get your hands on this with ease.
You can use this data to make more intelligent decisions going forward, from optimizing your rates to controlling your costs.
5. Achieve cost control in real-time to improve your business’ finances
In addition to the benefits that we have mentioned so far, there is no denying that an online purchase order system can also assist you in controlling your business expenses.
While it takes quite a while for an order to be carried out until an invoice is visible in your accounting system, you will be able to see all of the committed costs at any given time if using an online purchase order tool.
By utilizing a purchase order system, you can have full control over your expenses. You will have a “live” picture of how much of your budget is being committed at any moment in time. Naturally, this leads to much better budget control.
By having improved control of your budget, you can make improved decisions, meaning you can identify any possible budget overspending at the earliest opportunity.
As you are able to match a purchase order against an invoice, this makes sure you can spot any deviations from the invoice. Your accounting system and purchase order system will always be in sync, ensuring that everything runs as smoothly as possible.
Ultimately, this means you are going to spend less time on reporting, and you will have more time to spend on proactive tasks that drive your business forward.
6. Get a better handle on the procure-to-pay process
Vital data relating to a purchase order can be added once the purchase order has been sent to the supplier. Being able to add this information helps to speed up the process and ensures you’re operating at peak efficiency levels.
Some of the different pieces of information you may wish to add include the following:
- File attachments regarding the purchase order, for example, quotes
- Information about cost allocations or billing
- Information about the process of the invoice, for example, project, department, or account
In the procurement software you use, this can be added in a comments or fields section relating to the purchase order. This then means that all of the relevant information is going to be viewable in one place.
7. Reduce errors and benefit from high-quality data
A lot of people start off by using the likes of Word and Excel for their purchase orders. While this is okay as a starting point, as time goes on, it can be quite difficult to keep going with these tools. They rely too much on human input, and mistakes can easily be made.
This is especially the case if you need to update a purchase order, for example, if you need to amend the address, order number, or any other piece of critical data on the purchase order.
However, if you use an online purchase order system, this is not something you need to worry about. You can ensure that all of the purchase orders are automatically assigned the correct number. Plus, when you make a change, you can ensure that it is automatically implemented across all of the relevant purchase orders.
As online purchase order systems reduce the amount of manual input that is needed, this also means that there is a lower chance for errors happening. We have all been there; mistakes are made in the ordering process because of accidentally pressing the wrong button on the keyboard. It can be very frustrating and costly, but it does happen when you are relying heavily on human input.
If you use a quality online purchase order system, you can leverage automation to ensure that errors are reduced as much as possible. Not only can this ensure a smoother process but it can mean you are not wasting your money by ordering products you did not really need or by delaying the process by ordering the wrong items.
Reap the many benefits of an online purchase order system
From improving data security to saving time, there are many benefits that are associated with implementing an online purchase order system. A good order tool can automate the process so that you can reduce errors and boost efficiency at the same time.
Simply spend some time assessing the different solutions on the market today to find the right one for you. A lot of the tools available come with demos and free trials so you can get to grips with them before making your decision.