Blanket Purchase order

It is a PO with a longer validity period and a item specific value limit. Blanket PO can be used for procuring consumables or external services for which more detailed processing (PR/PO/GR/IR) are considered uneconomical.

The items or services can be grouped under a heading (text) and taken as a line item of blanket PO. The prices of individual items such as pencil/folder etc are not recorded in the PO.

Although a PR can be used as a preceding item for the blanket order, no RFQ or a contract can be created for one. Also there are no GRs or service entry sheets, only invoices are posted with ref to the blanket PO.

Key advantage of blanket PO is the reduction of processing costs, cost saving is due to the following factors;

·         Different materials/or services procured against a single line item over a longer period of time.

·         Not necessary to issue separate POs for individual procurement transactions.

·         There is no GR or service entry process.

Characteristics of a Blanket PO

1.      Order type = FO (framework)

2.      Item category = B (limit)

a.      limits on the  item

b.      no material master

c.       acct assignt cat U is allowed

d.      no GR or service entry sheet

3.      Acct data is suggested at invoice stage

4.      Additional or multiple account assignment possible in invoice

5.      Check of validity and value limit at invoice.