How Many Types of Purchase Order Types/Agreements Are There

When it comes to purchasing goods and services, businesses typically use purchase orders or agreements to outline the terms of the transaction. While there are various types of purchase orders and agreements, they can generally be grouped into four main categories:

1. Standard purchase order

A standard purchase order is the most common type of purchase order used by businesses. It outlines the details of the transaction, including the goods or services being purchased, the quantity, and the price. It also typically includes the delivery date, payment terms, and any other conditions of the transaction.

2. Blanket purchase order

A blanket purchase order is used when a business needs to purchase multiple goods or services from a single vendor over a period of time. It outlines the terms of the overall relationship between the business and the vendor, rather than just one specific transaction. The terms may include the pricing structure, delivery schedule, and payment terms.

3. Contract purchase order

A contract purchase order is used when a business needs to purchase goods or services from a vendor on an ongoing basis. It outlines a long-term agreement between the business and the vendor, including the pricing structure, delivery schedule, and payment terms. It is often used for large purchases, such as equipment or software licenses.

4. Blanket release order

A blanket release order is used in conjunction with a blanket purchase order. It specifies the details of a specific transaction within the overall blanket purchase order. For example, if a business has a blanket purchase order with a vendor to purchase office supplies, a blanket release order would be used to specify the quantity and price of a specific order of paper clips.

In summary, there are four main types of purchase orders and agreements: standard purchase order, blanket purchase order, contract purchase order, and blanket release order. Each type serves a specific purpose and is used in different situations. By understanding the different types of purchase orders and agreements, businesses can ensure they are using the appropriate documents for their transactions.