Purchase Order Execution: The Complete Workflow
You've planned what to order and when. Now execute: create purchase orders, track shipments, receive goods, and manage payments.
What You'll Learn
This folder covers the complete PO execution cycle:
- Creating Purchase Orders — From supply plan to actual order
- Updating & Managing Orders — Making changes before/after sending
- Shipments & Receiving — Track, verify, receive
- Payments & Terms — Financial management
- Landed Costs — True cost of inventory
- Currency Handling — International suppliers
The PO Lifecycle
FOLDER 03 (Policies) FOLDER 04 (Execution) FOLDER 03 (Status)
↓ ↓ ↓
You see "Running Low" → Create PO → Shipment arrives
You calculate restock qty → Send to supplier → Status = "Healthy"
→ Track in-transit
→ Receive goods
→ Pay invoice
When to Create a PO
From Folder 03 review:
A PO is triggered by Synplex's "Running Low" status:
Running Low Threshold = Lead Time Days + Safety Stock Days
When inventory ≤ this threshold:
├─ Grade A: CREATE PO TODAY
├─ Grade B: CREATE PO THIS WEEK
└─ Grade C: CREATE WHEN CONVENIENT (batch to save shipping)
Example:
Product: Blue T-Shirt
├─ Running Low threshold: 420 units
├─ Current inventory: 410 units ← HIT THRESHOLD!
├─ Action: Create PO immediately
├─ Restock qty: 240 units (calculated in Folder 03)
└─ Delivery in: 30 days
Key Decisions During PO Creation
1. Which Supplier?
- Primary supplier (normal, established)
- Secondary supplier (faster, different terms)
- Based on: lead time, cost, reliability, payment terms
2. What Quantity?
- From Folder 03: Restock Quantity = Total Need - On-Hand
- Respect: Minimum Order Quantities (MOQs)
- Consider: Volume discounts if available
3. What Currency?
- Supplier's currency (EUR, GBP, JPY, etc.)
- Or your base currency (USD, etc.)
- Synplex handles conversion automatically
4. What Payment Terms?
- NET 30 (standard, pay after delivery)
- NET 15, NET 60 (faster/slower payment)
- PRE-PAYMENT (pay before shipping)
- Early payment discount (2/10 NET 30)
5. What Lead Time?
- Confirm with supplier
- Account for production, shipping, customs
- Use realistic estimate (not optimistic)
Three Ways to Create a PO
Method 1: Manual Creation
When: Building from scratch, custom quantities
Step 1: Go to Purchase Orders
Step 2: Click "Create New PO"
Step 3: Enter supplier, products, quantities
Step 4: Set currency, payment terms, delivery date
Step 5: Save as Draft
Step 6: Approve & Send
Time: 10-15 minutes per PO
Method 2: From Supply Plan Recommendations
When: Using Synplex forecasts (most efficient)
Step 1: Go to Demand & Supply Plan
Step 2: Review Supply Plan
Step 3: See recommended orders for each product
Step 4: Click "Convert to PO"
Step 5: System pre-fills: supplier, qty, dates
Step 6: Adjust if needed (currency, terms, etc.)
Step 7: Approve & Send
Time: 2-5 minutes per PO (system does most work)
Benefit: Automatically calculated quantities, less error
Method 3: Bulk PO Creation (Multi-Location)
When: Ordering for multiple warehouses, consolidating shipments
Step 1: Review Running Low items across all locations
Step 2: Select multiple recommendations
Step 3: Create PO (Synplex groups by supplier)
Step 4: System consolidates quantities & delivery
Step 5: One PO for multiple locations = lower shipping cost
Step 6: Synplex tracks per-location allocation
Benefit: Save on freight costs, fewer supplier interactions
PO Status Flow
DRAFT
│ You're still editing, not sent yet
├─ Can make any changes
├─ Not committed to supplier
└─ Time: Hours to days
APPROVED
│ You've approved internally, ready to send
├─ Final check done
├─ Still editable (with care)
└─ Time: Ready to send
SENT
│ Supplier has received & confirmed
├─ Supplier is committed
├─ Limited changes (supplier approval needed)
├─ Now tracking: in-transit
└─ Time: Lead time days
RECEIVED
│ Goods have arrived at warehouse
├─ Quality checked
├─ Inventory updated
└─ Waiting for: Invoice & payment
PAID
│ Invoice processed, payment sent
├─ PO fully completed
└─ Cycle ready to repeat
Key Metrics Folder 04 Covers
| Metric | What It Means | You Control |
|---|---|---|
| Order Quantity | How many units | Yes (respect MOQ) |
| Order Currency | EUR, USD, etc. | Yes (supplier quote) |
| Conversion Rate | EUR → USD | Yes (manual or auto) |
| Delivery Address | Warehouse location | Yes |
| Lead Time | Days to delivery | Supplier (confirm) |
| Payment Terms | When to pay | Yes (negotiate) |
| Payment Currency | Currency you pay in | Yes (may differ from PO) |
| Shipment Currency | Freight cost currency | Carrier (may differ) |
Real Example: Complete Workflow
Company: Fashion retailer, 2 locations
Supplier: German manufacturer
Product: Winter Jackets
Step 1: Trigger (Folder 03)
Date: August 15
Status: Running Low (Berlin warehouse)
├─ Inventory: 280 units (below 295 threshold)
├─ Restock qty: 145 units (calculated)
└─ Action: Create PO
Step 2: Create PO (Folder 04)
Date: August 15
Supplier: ABC Manufacturer (Germany)
├─ Product: Winter Jacket
├─ Quantity: 145 units
├─ Unit price: €45 (in EUR)
├─ PO Currency: EUR (supplier's currency)
├─ Conversion: 1 EUR = 1.10 USD
├─ PO value in EUR: €6,525
├─ PO value in USD: $7,177.50 (for your accounting)
├─ Lead time: 45 days
├─ Expected delivery: September 30
├─ Payment terms: NET 30 (pay Sept 30-Oct 30)
└─ Status: DRAFT
Step 3: Send (Folder 04)
Date: August 16
Action: Approve PO & send to supplier
├─ Supplier receives & confirms
├─ Status: SENT
└─ Tracking begins
Step 4: Track (Folder 04)
Date: August 25
├─ Supplier ships from Germany
├─ Tracking #: ABC-123456
├─ Expected arrival: September 30
Date: September 30
├─ Shipment arrives at Berlin warehouse
├─ QC: 145 units received, 145 good
├─ Mark as received in Synplex
├─ Inventory updated: +145 units
└─ Status: RECEIVED
Step 5: Pay (Folder 04)
Date: October 1
├─ Invoice arrives from supplier
├─ Amount due: €6,525 (EUR)
├─ 3-way match: PO ✓, Receipt ✓, Invoice ✓
├─ Payment terms: NET 30 (due Oct 30)
├─ Exchange rate today: 1 EUR = 1.08 USD
├─ Payment in USD: €6,525 × 1.08 = $7,047 USD
├─ Action: Schedule payment for Oct 30
└─ Status: PAID (when sent)
Result:
├─ PO was: $7,177.50 USD (at Aug rate of 1.10)
├─ Payment was: $7,047 USD (at Oct rate of 1.08)
├─ Savings: $130.50 from favorable exchange rate!
└─ Why: Exchange rate improved between order & payment
Step 6: Back to Policies (Folder 03)
Date: October 1
├─ Inventory: 425 units (450 - sales + delivery)
├─ Status: HEALTHY ✓
├─ Back in range between Running Low (295) & Overstocked (600)
└─ Continue normal monitoring
Quick Reference: PO vs. Policy
| Question | Answer | File |
|---|---|---|
| When should I order? | When "Running Low" | Folder 03 |
| How much should I order? | Restock Quantity | Folder 03 |
| How do I create a PO? | Manual or from supply plan | Folder 04 |
| What currency should I use? | Supplier's currency | Folder 04 |
| How do I track it? | Shipment tracking | Folder 04 |
| When do I pay? | Payment terms | Folder 04 |
| What if it's late? | See Troubleshooting | Folder 04 |
Next Steps
- Read Creating POs — Learn the core workflow
- Open Synplex — Look at your "Running Low" products
- Create your first PO — Manual creation (safer to learn)
- Track & receive — See the full lifecycle
- Process payment — Complete the cycle
Key Takeaway
PO Execution is where policy becomes action. Synplex automates much of it (recommendations, calculations, tracking), but you control the strategy:
✅ Which supplier to use
✅ What quantity to order
✅ What currency to use
✅ What payment terms to negotiate
✅ When to pay (capture favorable rates)
Questions?
Each guide has:
- Step-by-step instructions
- Real examples with numbers
- Common mistakes & fixes
- FAQ sections
Contact: support@synplex.io