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Purchase Order Software: Features, Integrations, Success Factors, Benefits

Purchase Order Software - ScienceSoft

ScienceSoft applies 10-year experience in building supply chain management software and practical knowledge of 30+ industries to help companies design and implement effective purchase order solutions.

Purchase Order Software in a Nutshell

Purchase order software automates purchase order (PO) creation, approval, and submission to suppliers and provides secure centralized storage of all purchase-related documents. The solution enables multi-entity PO and spend tracking in real time and streamlines purchasing planning.

Necessary integrations: ERP, CRM, accounting software, an inventory management system, a vendor portal, etc.

Implementation time: 6 - 10 months for custom purchase order software.

Development costs: $140,000 - $400,000, depending on the solution complexity.

ROI: up to 185%.

Purchase Order Software: Key Features

At ScienceSoft, we design functionality of purchase order solutions for our customers based on their unique business needs. Here, we share a sample feature set that forms the core of the described software.

Purchase requisition management

  • Template-based generation of purchase requisitions.
  • Catalog-based (via a connected vendor portal) and non-catalog-based purchase requisitions for products/services.
  • Multi-department purchase requisition approval workflow.
  • Rule-based supplier assignment to purchase requisitions.

Purchase order creation

  • Automated PO creation from approved purchase requisitions.
  • Automated PO creation when inventory levels reach reorder points.
  • Customizable PO templates (for various vendors, departments, business entities, etc.).
  • Automated PO grouping across departments and business entities by supplier to get volume discounts for bulk orders.
  • Automated PO conversion to a supplier’s currency.

Purchase order approval

  • Customizable workflows for hierarchical, parallel, pool PO approval.
  • Real-time tracking of PO approval status for purchasing specialists.
  • Scheduled reminders to PO approvers.
  • E-signing of POs by the approvers.
  • Instant messaging tool for internal purchasing teams to communicate on PO approval.

Purchase order submission

  • Automated submission of one-time and recurring POs to suppliers by schedule/on the spot.
  • PO submission via email or a connected vendor portal.
  • Scheduled reminders for suppliers to confirm POs (via email, messaging apps, or a connected vendor portal).
  • Notifications to purchasing specialists on PO confirmation by suppliers.

Purchase order monitoring

  • Real-time PO tracking by status (sent, confirmed, invoiced, shipped, etc.), supplier, department, business entity, and more.
  • Scheduled/ad-hoc reports on PO status for purchasing specialists.
  • Customizable order delivery schedules.
  • Automated monitoring of essential PO metrics, such as the total number of POs by period, average PO cycle time, cost per PO, and more.

Reconciliation

  • Automated two- and three-way PO reconciliation (against purchase invoices and order receipts).
  • Automated PO to contract reconciliation.
  • User-defined thresholds for PO matching tolerance for price, total value, quantity, etc.
  • Validation of the invoice tax amount according to the pre-set rules.
  • Alerts on exceptions (mismatched, missed or inaccurate data, duplicate invoices, tax variances, etc.) that require manual handling.
  • Automated routing of valid invoices for payment.

Spend monitoring

  • Real-time tracking of spend amounts (by period, SKU, category, supplier, department, location, project, etc.).
  • Setting user-defined spend limits (by period, supplier, department, etc.).
  • Alerts to the purchasing team on spend amounts nearing/exceeding the pre-set limits.
  • Automated calculation and reporting on essential spend metrics, such as total spend amount (by period, supplier, department), spend under management, spend variance against pre-set budgets on the enterprise/department/project level, and more.

Analytics and forecasting

  • Purchasing planning (by category, department, business entity, etc.) based on the analysis of relevant historical data on purchase orders.
  • Calculating PO delivery dates based on the lead time specified by the vendor, PO shipment status, working days calendar, etc.
  • Spend analysis and forecasting (by period, category, department, region, etc.).
  • AI-powered customer demand forecasting based on the analysis of historical customer purchasing behavior.

Purchase document storage

  • Centralized storage of purchase-related documents (purchase requisitions, PO, invoices, order receipts, etc.).
  • Automated linking of POs with relevant invoices and purchase requisitions.
  • Search engine with filtering and metadata querying to navigate purchase documents.

Security and compliance

  • Multi-factor user authentication.
  • Role-based access control.
  • Full audit trail for all purchasing-related activities.
  • Supplier data retention and deletion policies.
  • Compliance with SOX, SOC 1 and SOC 2, WTO regulations, FAR (for federal government procurement in the US), other relevant region- and industry-specific regulations.

Get Effective Purchase Order Management!

ScienceSoft’s team is ready to plan, build, and support a robust purchase order solution to streamline purchasing planning, purchase order creation and management, spend tracking and analysis.

Essential Integrations for Purchase Order Software

To ensure fast and precise purchasing planning and enhance visibility of purchase order statuses, ScienceSoft recommends integrating the purchase order solution with the following back-office systems:

Integrations for purchase order software - ScienceSoft

ERP

  • For accurate purchasing planning.
  • For operations and strategic planning.

Inventory management system

  • To trigger automated PO creation for timely inventory replenishment.

Warehouse management system

  • For the automated confirmation of order delivery.
  • For faster matching of order receipts to POs.

Vendor portal

  • For the automated input of product or service data when generating purchase requisitions and POs.
  • For the automated PO submission to suppliers via a vendor portal.
  • For facilitated PO status tracking.
  • For faster matching of supplier invoices uploaded from a vendor portal to POs.

Accounting software

  • To pay for purchases.
  • To provide relevant data for automated customer invoice creation based on PO data (to pass the purchasing cost onto the customer if needed).
  • To accurately record invoices in the A/P ledger and the general ledger.

Supplier relationship management (SRM) software

  • To ensure compliant supplier assignment to purchase requisitions and POs.
  • For faster PO and contract matching.
  • To monitor supplier performance against the pre-defined KPIs.

Financial planning and analysis software

  • To enable spend vs. budget tracking.
  • To ensure accurate budgeting at the company, department, project level, and more.

Success Factors for Purchase Order Software

To maximize value and cost-efficiency of the purchase order solution, ScienceSoft always seeks to cover the following important factors:

Maximized automation of PO management processes

To eliminate manual tasks across the entire PO cycle, from PO creation and approval to PO reconciliation.

Mobile access

To enable easy creation, approval, submission, and tracking of POs on the go.

AI-driven forecasting

To predict various purchasing parameters (e.g., customer demand for particular products or total spend by supplier, department, business entity for future periods) based on historical supplier behavior, demand and spend data analysis for accurate purchasing planning.

Easy-to-use APIs

To provide streamlined connection of purchase order software to the business-critical systems (ERP, CRM, accounting software, an inventory management system, a vendor portal, etc.) and ensure real-time data sync.

Purchase Order Software Implementation Costs and Financial Outcomes

Purchase order software development costs vary from $140,000 to $400,000, depending on the solution complexity.

Custom purchase order software can bring up to 185% annual ROI.

Benefits of purchase order software

  • Up to 99%

    POs are managed automatically

  • 75%+

    faster PO processing due to automation

  • Up to 90%

    increase in the purchasing team productivity due to elimination of manual PO management tasks

  • Facilitated

    inventory reordering due to automated PO creation triggered by reorder points

  • Enhanced

    spend visibility due to comprehensive spend analysis and reporting

  • Off-the-Shelf Purchase Order Software ScienceSoft Recommends

    Oracle Purchasing

    Best for: managing multi-entity purchasing activities

    Description

    Oracle Purchasing supports centralized purchase order management and spend monitoring across multiple subsidiaries and branches of a company. You can set user-defined events to trigger automated PO creation, leverage multi-currency and multi-language capabilities to process international purchase orders, and track PO status and shipment schedule in real time. The software provides seamless integration with other Oracle apps, including Oracle Payables and Oracle iSupplier Portal, to streamline management of the entire procure-to-pay cycle.

    Pricing

    Upon request to the vendor.

    Digital Purchase Order

    Best for: PO management on the go

    Description

    Digital Purchase Order enables automated PO creation and submission to vendors, multi-department PO approval, and real-time PO status tracking via a web app or native iOS and Android mobile apps. It provides centralized online storage for POs with role-based access and easy PO search by keyword. The software offers 200+ customization options, e.g., to add custom PO numbers to POs, department names and spend types, configure PO approval workflows for various departments, or create branded PO templates and spend reports.

    Pricing

    Upon request to the vendor.

    Procurify

    Best for: spend tracking and analysis

    Description

    Procurify enables real-time spend tracking, calculating and monitoring spend variance against company-, department-, project-level budgets, and provides AI-powered spend analytics by department, project, supplier, etc. The software allows for template-based PO creation, rule-based PO consolidation across departments and business entities by supplier, and configurable multi-level PO approval workflows. You can easily integrate this software with NetSuite, QuickBooks, Microsoft Dynamics 365 and other popular ERP systems.

    Pricing

    Upon request to the vendor.

    When to Opt for Custom Purchase Order Software

    ScienceSoft recommends building a custom purchase order solution in the following cases:

    You need a purchase order solution providing specific features, for example, AI-powered spend forecasting.

    You operate in highly regulated industries (e.g., healthcare, government sector, defense) and need purchase software to meet specific compliance and security requirements. For example, in our project for the US hospital system, we developed a custom purchase management solution compliant with strict HIPAA regulations.

    You want to avoid costly and effort-consuming integration of buying software with your corporate systems, including legacy (accounting software, an inventory management system, a vendor portal, etc.).

    You have large teams involved in purchasing processes and want to avoid a considerable subscription cost for a platform-based purchase ordering system, which scales with the number of users.

    Purchase Order Software Development with ScienceSoft

    In supply chain management software development for 10 years, ScienceSoft helps companies build reliable purchase order solutions.

    Purchase order software consulting

    • Analysis of your purchasing management needs.
    • Suggesting optimal features, architecture, and tech stack for the purchase order solution.
    • Preparing an integration plan with ERP, accounting software, an inventory management system, a vendor portal, etc.
    • Implementation cost & time estimates, expected ROI calculation.
    GO FOR CONSULTING

    Purchase order software implementation

    • Purchasing management needs analysis.
    • Purchase order solution conceptualization.
    • Architecture design.
    • Purchase order software development.
    • Integrating the solution with relevant corporate systems (ERP, accounting software, an inventory management system, a vendor portal, etc.).
    • Quality assurance.
    • User training.
    • Continuous support and evolution (if required).
    GO FOR IMPLEMENTATION
    About ScienceSoft

    About ScienceSoft

    ScienceSoft is an international IT consulting and software development company headquartered in McKinney, Texas. We provide consultancy and development services to help organizations build effective purchase order software tailored to their purchasing management needs. Being an ISO 9001 and ISO 27001 certified company, we apply a mature quality management system and guarantee that cooperation with us does not pose any risks to our customers’ data security. If you are interested in developing a reliable purchasing solution, turn to ScienceSoft’s team for custom purchase order software.