There are countless software packages that offer niche services, such as billing or bookkeeping. One such software is a purchase-order management system, or PO system. And it’s important.

If you want to improve operations, such as inventory tracking or supply chain management, or if your procurement team is struggling to stay on top of purchase orders – it may be time to invest in a flexible software solution that can generate, control, and track purchase orders. 

What is the purpose of a purchase order?

A purchase order is an important part of a business’ buying process. It is a document issued to vendors outlining purchase requests, and it formalizes the parameters of the purchase agreement (pricing, quantities, business requirements, etc.). It is a legally binding document that sets up long-term relationships between businesses and suppliers. 

A purchase order is not the same as an invoice, however. While a PO is issued by the interested company or small business, an invoice is the document that handles the fulfillment process. Both documents are an important part of procurement, but without proper purchase order and contract management, you could be putting vendor relations at risk. 

What is the difference between a purchase order and a vendor contract?

Purchase orders and contracts between a business and third party vendor can be tricky to differentiate. Both are agreements between two parties defining procurement requirements and parameters, but there are a few key differences every business owner should know.

A contract is usually a long-term commitment, with a possible clause for renewals down the line. Purchase orders, on the other hand, are short-term agreements tied to a single transaction. Contracts are more secure than POs, as they are legally binding from the get-go (whereas POs are not so until they’re accepted by a seller). Lastly, contracts come into play when negotiating payment, while POs are more commonly reserved for inventory management.

Why your business needs a good purchase order management software

The best procurement software streamlines inventory management and purchasing tasks, so investing in the right PO software can save your business time and money. Whether you personally oversee purchase requisitions, or have a dedicated team handling inventory levels, software such as Procurify or Fishbowl Inventory can replace time-consuming tasks with automated operations and digital purchase orders, as well as greatly reduce the risk of documentation errors. 

Essential features to look for in purchase order systems

To get the most out of your purchase order management software, look for automation features and asset tracking capabilities. The best PO software will support business growth and operational efficiency across the board. Look for the following features when choosing a purchase order software for your business: 

• Automated purchase orders that are generated based on tracked inventory levels
• Accounting software tools, such as invoice matching, which can bridge the gap between procurement and billing / bookkeeping operations
• Data analytics for tracking budgets, unit costs, and purchasing processes
• Purchase requisition capabilities to support approval processes by leadership

Five of the best purchase order software for businesses today

To find the best purchase order management system for your business, define your priorities. Below are five of the most prominent PO systems being used by businesses to support greater profit and productivity.

Zoho Books: best for small and medium-sized businesses

For a well balanced software solution that centers on supporting growing businesses, Zoho Books simplifies the purchase order process with affordable pricing options. With a comprehensive suite of software solutions, including the integrated Zoho Inventory system, this software allows for streamlined PO processing, asset tracking, and user-friendly interface. 

Plans start at $9 per month for the Basic Plan, but higher tiers include the Standard Plan ($19 per month) and Professional Plan ($29 per month).

Pairsoft’s Paramount WorkPlace: best for customized approval workflows

For businesses looking for a PO software solution that works in tandem with their procurement and approval systems, this brand has everything you need. Founded in 1995, the tech company Paramount Workplace (not to be confused with Paramount Pictures) was combined with two other market-leading brands (PaperSave and Webiplex DocuPeak) in 2020 under the brand name PairSoft. This comprehensive service will automate your requisition, procurement, accounting, inventory management, and expense tracking tasks – freeing your teams to focus on other responsibilities. 

PairSoft’s acquisition software offers custom software packages with pricing that fluctuates depending on the size and scope of your business needs. Sign up for a free demo to try out their services and receive a quote.

Coupa Procurement: best for transparency and administrative oversight

Real-time tracking, a focus on maximizing pre-approved spending, and intuitive interfaces are some of the features offered by Coupa Procurement. With “Suite Synergy,” an spending management platform, businesses can finalize contracts and maintain control over product and service purchases.

Coupa’s purchase order management system offers investors the chance to try their software and receive a pricing quote with a free demo. 

QuickBooks Commerce: best for integrated accounting features

Integrated features for billing, accounting, and bookkeeping can be essential for larger businesses or business owners ready to scale their business. QuickBooks Commerce is a cloud-based software solution built into QuickBooks Online, which is your one-stop-shop for tracking business expenses, paying contractors, and building comprehensive reports. 

Pricing plans include Founder ($39 per month), Lite ($99 per month), Small Business ($249 per month), and Business ($699 per month). 

Tradogram: best for budget and asset tracking insights

Tradogram places the focus on spend control, letting businesses track budgets and expenses, control user permissions, and drive supplier management with consolidated lists and item catalogs. The ability to build custom financial reports from the ground up makes this system a powerful tool for detailed inventory management.

In addition to a Free Plan (which limits you to one user and up to 10 monthly purchase orders), you can sign up for Premium ($18 per month) or Enterprise (requires a custom quote).