Purchase order
What is a purchase order? Learn how POs work, what they include, when you need one, and how they differ from quotes and invoices.
What a purchase order is
A purchase order (PO) is issued by the buyer to authorize a purchase. It tells the seller what to provide, at what price, and under what commercial terms.
For freelancers and small vendors, a PO is often the green light that the client’s company has budget approval. Without it, your invoice may sit unpaid even if a manager verbally said yes.
The PO is not a request for you to pay—it is the buyer’s internal authorization document that you should reference when you bill.
What a PO typically includes
PO number, buyer and seller details, line items, prices, delivery or service dates, billing address, and approval signatures or system IDs.
Service POs may describe milestones or retainers rather than physical goods. Still insist on a unique PO number you can print on invoices.
If anything on the PO conflicts with your quote, resolve it in writing before you start. Working against a mismatched PO creates payment friction later.
When you need a PO
Many mid-size and enterprise clients require a PO before vendors start work or before AP can release payment. Ask early: “Do you need a purchase order for this engagement?”
Startups and small clients often skip POs. That is fine—as long as you still have written acceptance of scope and price.
If a client says “invoice us” but their policy requires POs, pause until the PO arrives. Starting early out of kindness can leave you unpaid for weeks.
How POs fit with quotes and invoices
Typical flow: you send a quote → buyer issues PO → you deliver → you send invoice referencing the PO number → AP matches PO to invoice and pays.
Put the PO number in a visible field on your invoice, not only buried in an email thread. Matching is a core AP control.
If the PO amount is lower than your quote, do not silently absorb it—clarify before delivery.
Practical tips and next steps
Keep a simple log of PO numbers by client and project. When reminders go out, include the PO so AP can find the record quickly.
For recurring work, ask whether each month needs a new PO or whether a blanket PO covers the year.
What to do next: add a PO field to your intake checklist for any client with more than a handful of employees.
Key takeaways
- A PO is the buyer’s authorization to purchase
- Always put the PO number on your invoice when required
- Resolve quote vs PO mismatches before you start work
- Ask early whether a PO is required
- AP often cannot pay without a matching PO
- Track PO numbers alongside invoice numbers