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Home » Business Management » How can you use Blanket Purchase Order as a money saving mechanism?
Blanket Purchase order is a type of a Purchase Order which the customer can make with his supplier for multiple delivery dates over a period of time. This PO is usually negotiated to take advantage of a predetermined pricing. This kind of a PO is used for expendable and durable goods, where the payment happens over a longer duration.
Blanket Purchase Order is also a saving mechanism which protects the consumer against fluctuating money rates and pricing especially if the transaction is done globally. This is a tremendous help for the consumers to save a lot of money in general.
While selecting an ERP System, Blanket PO should be a must have for companies especially if they operate in the Global market. This feature is available in Sage 300 – A robust and scalable ERP Solution for Small and Mid-sized businesses.
Here, in this blog will see how the blanket purchase order is booked in Sage 300. Let’s take an example by placing a blanket order for florescent desk lamp of quantity one.
Blanket order is slightly different in functionality by the other order types since they also contain an additional field: Original Amount: Predetermined amount; which limits the receipt of goods once the defined amount is reached. The second distinguishing feature of a Blanket PO is Amount available which displays the pending amount after a partial receipt.
Note: The Blanket order created is for 1 Quantity and its unit price is 300/- . The order is valid till the original amount has crossed or reached i.e. 3000/- .
The quantity ordered column must be > 0 as the system won’t allow user to post the order with a zero quantity.
Refer below table for Partial GRN’s against Blanket PO:
Similarly we have received 10 fluorescent desk lamps by raising the same blanket PO, hence the PO’s available amount becomes Zero (refer the below screen shot).
As the original amount has been reached, now if we unknowingly try to receive more material i.e. pass an receipt entry, the system will not allow to complete the GRN as the PO has already reached the predetermined amount and there is no amount available for purchase which states that the blanket PO is complete and won’t receive any item against that PO in future.
To know more about blanket purchase order or your industry specific requirements, SMS SAGE to 56767. You can also write to Sage Software Solutions Pvt Ltd at firstname.lastname@example.org
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