Purchase Order Acknowledgment

A purchase order acknowledgment letter is basically a confirmation from suppliers that they will deliver specific quantities of products at particular prices within a specified period of time.

A PO acknowledgment could be fully acknowledged without any deviations, or it can be partially acknowledged. Any deviations from original PO’s concerning delivery dates, quantities, prices, etc. could be recorded. The buyer can also choose to accept or to reject deviations accordingly.

When changes are accepted to the purchase order acknowledgment template, the system will update the original PO. This is exactly how Precoro functions.

PO acknowledgments allow suppliers to respond to POs. Given this response, suppliers could accept terms and conditions of POs, propose any changes to various aspects of the PO, or reject POs altogether.

Po acknowledgments could be manually or automatically created:

  • Manually: Suppliers could pass the PO acknowledgment details in print through fax, email or mail as attachments. As buyers, you can enter details manually into systems after this. Before saving new acknowledgments, you can run system checks to verify the correctness of data. The system will then compare the PO acknowledgment with corresponding PO’s in order to confirm any deviations. If there are any deviations, PO acknowledgments need to go through approval processes where a decision needs to be made on whether the change are to be accepted or rejected. If they are rejected, the PO remains unchanged and if they are accepted, the system will update the PO accordingly.
  • Automatically: Here supplier can automatically send responses to purchase orders in XML form using EDX or in interactive forms. The system makes use of information from XML files or interactive forms in order to create POsĀ  acknowledgments automatically. If suppliers are using software like Adobe Interactive Forms, you could automate PO acknowledgment creation and updates in the system. The system will automatically check if quantity and date of delivery of PO acknowledgment match with those of PO’s. The only exception results here are manual processing steps.

Value Limits

For items with limits that don’t have subitems, acknowledged value limits are the limits amount which are acknowledged by suppliers. The limits could be detailed using specific services or by material items in the goods or services receipts or invoices later as part of the procurement process.

For limits that have subitems, the buffer when it comes to additional items is the limit left which hasn’t been detailed in the PO acknowledgment but could be detailed by the specific service or material items in the goods or services receipts or invoices at a later time in procurement.