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Invoice notes and terms example for Procurement

hi guys welcome back to another exciting week of the shipmate youtube channel this week we're talking about purchase orders packing slips and invoices and what's the difference so guys i hear tons of people out there talking about pos talking about packing slips talking about invoices and they use a lot of these terms interchangeably but today i want to tell you about all three of these documents and what makes them different so let's start with the purchase order or the good old po the purchase order is a document that's often given from the buyer to the seller it includes important information like who is the buyer what's their address what goods do they want in what quantities and at what price right and it might have a bunch of other kind of things like contact information or other industry specific information but this document is a lot like you know the touch screen that you touch when you go into a coffee shop or a gas station and it's it's where you place your order right this is how you tell somebody what you intend to buy or what you want in a way of goods or services so for example you know the same way you might go to sheets and order a cheeseburger right you sit there you select cheeseburger i want lettuce tomato onion you know ketchup no pickles right you do the same thing with purchase order you might order you know 500 of this item and 100 of this item and two dozen of that item so it's a way to you know tell the seller what you want in an official kind of way the next thing we're going to talk about is the invoice right so the invoice is a document that is given from the seller to the buyer this document usually includes things like you know the quantity available right to fulfill that order so like for example you know this is where you'll see that you know final purchase quantity you'll see the final cost you'll see your payment terms you know whether it's net 30 let net 90 cash on receipt all those kind of terms laid out you'll see maybe even your delivery terms and this is kind of where it lays out all those payment instructions it lays out the deal and the you know the buyer can look at that invoice and you know agree to pay it and agree to you know receive those goods or services so that's where the invoice really comes in and then finally we have the packing slip so the packing slip or packing list is something that usually comes along with the delivery of physical goods right so if you order a pallet or you order a box there's usually a nice little list inside there and it tells you what's included right so it'll tell you you know you got 500 of this or 200 of that on a pallet or if it's in a box it might say you know one sweater you know one pair of socks and a dress you know so this is going to tell you what is included in that shipment what's on that shipment and this is really important because sometimes you might order something and it might come in multiple boxes or multiple shipments and it's really good to have that packing list especially if you're trying to receive these goods into an inventory management system or something else like that because you want to know what you have what you don't have what you're waiting on um and that way you can follow up on that to make sure that you know what was received matches what was on the invoice right so it's really important to you know include a packing list if you're a seller and you know to really reference that packing list if you're doing any kind of inventory work so the packing list is very important so guys these are the three main documents you see all the time when you're you know you're buying something you're receiving something in the mail you're receiving something on a pallet and it's important to understand what the differences are so in summary the differences are the po is a document used by the buyer to signify to the seller what they're interested in purchasing at what price at what quantity the invoice is a document given by the seller to the buyer that lays out payment terms freight terms um you know the information of what they're they're going to be selling them and at what price um and it allows you to you know get all those details collected in one place and then finally a packing list or packing slip is the document that comes along with the shipment that tells you what is contained in this specific shipment box palette etc so all three of these documents are really important if you're going to be running a business you better get used to having all three of them going especially if you're an e-commerce seller because you're gonna be putting pos to your suppliers pos to your packaging companies pos to your fulfillment center you're gonna be receiving invoices from all of those right you're gonna be invoicing customers for their purchases you're gonna be receiving pos from your customers invoices out to them you're going to be getting you know packing slips and putting those in all your packages when you're receiving things in your receiving packing slips from other people so it's really important to get used to these three documents because they're really important in commerce in both retail e-commerce and you know just the general transfer of goods throughout our economy i hope you guys learned something if you did give us a like give us a subscribe give us a follow you know we're trying to get to 2000 we're almost there and you can be the one who sets us over the edge so we really want you to you know stay engaged be part of the shipmate family and thank you guys so much for watching and we'll see you next week