Accepting Purchase Orders?

[BrianKE]

I have been accepting POs since I started 5 years ago but have never had any kind of formal 'contract' stating any conditions with using POs.

I have had 2 customers lately that are late in paying and am thinking of making anyone that wants to use a PO sign some type of agreement as to the conditions of using a PO (payment, authorized persons, etc.)

Does anyone out there do this and can you tell me where/how you came up with the terms of your PO contract? Anyone have a generic 'contract' they would care to share?

 

[briankb]

What criteria do you have for who you will or will not accept a purchase order from?

 

[James Burke]

That sounds like a good idea. It could be a "PO Confirmation" statement that says you have received the customer's order / instructions. The customer would sign the statement and return it to you before the order is processed.

Included on the statement would be your payment terms and some additional wording that further indicates that by their signature, the customer agrees to abide by your payment terms or be placed on COD.

JB

 

[Mosh]

It is a scam, if you press any company will pay with a credit card on the spot, unless it is over a coulpe K!!! Been there done that!!!

 

[binki]

We do accept a PO but new customer pay 100% up front. Established pay 50% down. Balance is due at pickup. We don't do terms. The PO is an added benefit for us because it establishes the intent of the customer to place an order and pay and puts in writing what they want. Good for when you have to go to court.

 

[CheapVehicleWrap]

We do accept a PO but new customer pay 100% up front. Established pay 50% down. Balance is due at pickup. We don't do terms. The PO is an added benefit for us because it establishes the intent of the customer to place an order and pay and puts in writing what they want. Good for when you have to go to court.

Wouldn't 120% be better?

 

[BrianKE]

What criteria do you have for who you will or will not accept a purchase order from?

Most importantly I would like to have in writing that payment is due 45 days from date of invoice and that late charges will be applied every 30 days after that.

Aside from that I am not sure what else I might need. I was hoping someone else might have done this and could make suggestions.

 

[BrianKE]

It is a scam, if you press any company will pay with a credit card on the spot, unless it is over a coulpe K!!! Been there done that!!!

I do not take credit cards, most of my business (80% +) is from management companies who use nothing but POs and have no credit card available. I had a credit card machine for about a year and found that less than 3% of my customers paid with it so I ditched it. I find that most people and companies will pay by check or cash and none have ever not purchased from me for lack of taking credit cards.

Most of my orders are no more than a couple hundred dollars so that might make a difference. For those orders over 1K I always require 50% down and payment in full on delivery.

 

[John L]

Generally a P.O. is a contract that states they dont have to pay you and that the P.O. takes power over any other agreement.

Your contract should state that they DO have to pay you and that it takes power over any other agreement.

The game is to see who can have the latest executed instrument. Lots of wasted effort there, but thats how you do business with white collar crooks.

 

[TheSnowman]

We always took a PO as something as good as money, we just had to wait for it...then we got stung. Had several PO's to a company that went out of business and we never saw our money. It's just like everything else, until you have it in hand, it's a gamble as to if you'll see it. The red flag should have been when we hadn't done work for them in the past 20 years and out of the blue get a call for a bunch of stuff.

 

[Gene@mpls]

I have always looked at POs as internal company paperwork- worthless to
me. Your normal payment policies apply.