What is Open Order?
Open order, also known as a blanket order, is a type of purchase order that allows a business to purchase a certain amount of goods or services over an extended period of time. This type of order is commonly used when a company regularly buys the same items from the same supplier. It helps to streamline the purchasing process and allows the buyer to get better pricing due to the large volume of the purchase.
Benefits of Open Order
Open order can be beneficial to both buyers and sellers in many ways. Some of the advantages include:
- Cost Savings – Bulk purchasing with an open order helps to reduce the cost of each item purchased, as the supplier may offer discounts for large orders.
- Time Savings – With an open order in place, buyers don’t need to issue multiple purchase orders for the same items from the same supplier. This helps to free up time for buyers to focus on other tasks.
- Long-term Relationship – Open order also helps to strengthen the relationship between the buyer and the supplier, as the supplier can be assured of a steady stream of orders.
Examples of Open Order
Open order can be used in many situations. Here are some examples:
- A restaurant chain may have an open order with its food supplier, allowing them to order a certain amount of ingredients each month without needing to issue a new purchase order.
- A manufacturer may have an open order with its parts supplier, allowing them to order parts for their products each month without needing to issue a new purchase order.
- A retail store may have an open order with its clothing supplier, allowing them to order a certain amount of clothing each month without needing to issue a new purchase order.
Open order can be a great way to streamline the purchasing process and save time and money. If you are looking for a way to reduce the cost of your purchases and simplify the process, open order may be the right solution for you.