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Spend culture became a hot topic when a U.S defense agency paid $638 for a toilet seat. In the early 1980s, government agencies were constantly overcharged for basic goods. As the spending started to get out of control, organizations started to adopt a cost-conscious culture using purchase orders and other legally binding contracts.
Paper-based purchase orders brought in a semblance of structure to the precarious purchasing culture. To ensure that nothing was overlooked, a fool-proof purchase order approval was set up with multiple checkpoints and approvers.
When there are a lot of people asking for a lot of things, there’s bound to be a lot of confusion. To solve that, standard checklists and templates were created.
As your business processes make a progressive move towards automation, incomplete solutions like PO templates simply don’t make the cut. Would you be ready to settle for undertaking payroll manually? Of course not! Then, why waste time with building blocks when completely constructed solutions are easily available?
Purchase order template is predefined forms that you can use as they’re or customize them to raise new POs rather than starting from scratch. It helps organizations minimize the time spent on purchase orders. Rather than creating a new purchase order document every time, a purchase order form template simplifies the process and ensures consistency.
Maintaining a standard PO template will take a lot of administrative burden off your procurement team, and minimize mistakes.
Most SMBs tend to use existing MS Office or Google Docs templates to sketch out their purchase order format in a document. These purchase order forms generally list all essential purchase order fields that a buyer needs to specify before it is sent to the vendor.
A purchase order template usually contains:
If your purchase orders rely on Excel spreadsheet templates to control spend, then there are chances that you may be operating well below your optimal efficiency and profitability levels.
Here are six challenges businesses face daily due to pre-conceptions about Excel-based PO templates:
Modifying the size of a specific field can mess up the alignment of your whole template. If the data you have to enter in a specific field is larger than the available space, the whole template will shift to keep up and move things to places you don’t want them to be.
The hardest challenge in using Excel templates for a purchase order form is keying in accurate data into spreadsheets. Inaccurate data makes it impossible to make effective plans. Any and all reports or decisions taken based on this data would be a guess at best.
When there is a policy or process change, every purchase order template needs to be updated manually. When data is extracted, compiled, and consolidated manually from multiple resources, it takes a substantial amount of time to ensure real-time data sync.
It might seem like an easy task to store all spreadsheets in a single folder. But if the person who handled this before you did not organize POs properly, you’re in real trouble. Hunting for a spreadsheet in someone’s local drive or archived files is a tough task.
When your purchase order forms are stuck in file cabinets or in a local disk, audits will sideline the entire team for a couple of weeks, since they may have to plough through heaps of digital and physical folders aimlessly.
Making decisions on manual reports created from the data on Excel/Word purchase order form templates can cause expensive mistakes with serious implications.
Cloud-based procurement are the pinnacle of technology harnessed specifically to execute purchasing functions in the easiest, most effective way possible. They are a number of steps ahead of older PO templates, when it comes to handling purchase orders.
To compare, let’s looks at the advantages claimed by PO templates:
Now consider the advantages of handling POs through a digital, cloud-based procurement software like Kissflow Procurement Cloud.
From this simple comparison of features, it’s easy to see which alternative is the way to go.
Excel/Word-based purchase order templates are extremely prone to manual errors and discrepancies. If left unchecked, these discrepancies have the power to shake the very foundations of an organization with extravagant spending. To prevent such instances, the purchasing team will overexert themselves and burn out. On the other hand, digital templates take time to set up and require multiple attempts to get right. This can cause IT backlogs, burnouts, and (if you outsource setup) hefty bills and delays.
Overworked purchasing staff are bound to make mistakes that can prove to be detrimental when a purchasing decision is based on the available data. Wouldn’t it make everyone’s life easy, if the staff could spend little time dealing administrative headaches like data collation, management, etc. and more time doing actual work?
Now, they can.
Kissflow’s digital approach to purchase order management is programmed to fetch the right purchasing information without any errors. You get access to a PO management tool designed to execute, store, retrieve, and manage POs with minimal fuss and optimal efficiency and speed. If you want to test an automated purchase order format before committing to a paid solution, try Kissflow’s free demo today.