A purchase order terms and conditions template is the standard legal wording attached to the back or second page of every PO, binding the vendor once it accepts the order. It covers acceptance, pricing, delivery, inspection, payment, warranties, cancellation and governing law.
It is the standard set of purchase terms that sits behind the price and quantity on a purchase order. The PO is your offer, and once the supplier accepts it, in writing or simply by shipping, the order and these terms form a binding contract. The PO says what you are buying; the terms say what happens if it arrives late, damaged or wrongly invoiced.
Buyers attach the same terms to every order, usually on the reverse of the PO, as a second page in the same PDF or through a link in the PO footer. Procurement and legal agree them once and reuse them, so nobody renegotiates delivery or payment rules order by order.
They matter most for one-off purchases where no master agreement exists. Where a signed contract already covers the supplier, the terms should say that the contract wins if the two conflict.
The PO is an offer accepted only on its own terms, and shipping or starting work counts as acceptance.
Fixed prices that cannot rise, packaging and handling included, and sales tax shown on its own line.
Delivery on schedule with risk staying with the supplier until arrival, then a window to inspect and reject faulty goods.
Invoices that quote the PO number, payment days counted from an accurate invoice, and the right to withhold disputed sums.
Goods that are new, meet the specification, are free from defects and fit for their purpose.
When the buyer can cancel and what it owes, plus which law applies, usually where the buyer is based.
Ready to use in Word, Google Docs and PDF. Fill it in, save it, reuse it.
Legal and procurement agree one standard set, plus a short version for low-value orders.
Every PO includes or links the terms and names the version and date it uses.
The supplier signs, confirms by email or ships. The acceptance clause says which of these counts.
Goods arrive and the receiving team inspects them within the agreed window, rejecting anything that does not match the order.
The supplier invoices quoting the PO number, and you pay correct invoices on the stated terms.
The simplest usable version is one page with six clauses: acceptance, price, delivery, inspection, payment and governing law, linked from every PO footer.
The clauses follow the path an order takes: accept, price, deliver, inspect, pay, then what happens when something goes wrong. Clause 1 matters most, because it decides whether your terms or the supplier's apply. The sample wording below covers the three clauses buyers edit most often.
The PO is the buyer's offer and can be accepted only on these terms. Signing, written confirmation, starting work or shipping counts as acceptance, and extra supplier terms are rejected unless the buyer agrees them in writing.
Prices are fixed as stated and cannot rise, and include packaging, handling and delivery unless the PO says otherwise. Sales tax is shown as a separate line, and none is charged where the PO states the buyer is exempt.
Time is of the essence: goods arrive on the scheduled date at the stated address, with an Incoterm for cross-border orders. Risk stays with the supplier until delivery, and the buyer may refuse early, late or unapproved partial shipments.
The buyer may inspect goods within [X] days and reject defective or non-conforming items, returned at the supplier's risk and cost for a refund, credit or replacement. Payment does not count as acceptance.
Invoices quote the PO number and match its lines. Accurate, approved invoices are paid [Net 30] from receipt, and the buyer may withhold or set off any amount in dispute.
Goods and services match the specification, are new, free from defects in design, materials and workmanship, merchantable, fit for purpose and lawfully supplied, for [12] months from acceptance.
The buyer may cancel for convenience before shipment, paying only the supplier's reasonable, documented costs, or cancel at once for breach or late delivery.
The buyer may change quantities, dates or specifications in writing. Any price or date effect is agreed in a signed change order.
The supplier covers third-party claims from defects, negligence or IP infringement. Any cap on either party's liability is stated here.
Information shared under the PO is used only to fulfil the order and stays confidential after it is complete.
The law of the state or country where the buyer has its main place of business, the courts or arbitration body that hears disputes and the escalation steps to try first.
1. Acceptance and formation This purchase order is an offer by [Buyer Company] to buy the goods or services described in it, and it may be accepted only on these terms. [Supplier Name] accepts it by signing and returning it, confirming acceptance in writing, starting performance or shipping the goods, whichever happens first. Any different or additional terms in the supplier's quote, acknowledgement or invoice are rejected unless [Buyer Company] agrees to them in writing. 2. Pricing and taxes The prices on this purchase order are fixed, are not subject to increase and include packaging, handling, insurance and delivery to [Delivery Address] unless the order states otherwise. Sales tax is shown as a separate line; where this order states that [Buyer Company] is tax-exempt, no tax will be charged. [Supplier Name] may not add charges or surcharges without a change order signed by [Buyer Company]. 3. Delivery and risk of loss [Supplier Name] will deliver the goods to [Delivery Address] on the dates in the delivery schedule. Time of delivery is of the essence. Risk of loss stays with [Supplier Name] until the goods are delivered to that address. [Buyer Company] may refuse deliveries that arrive early or late, and partial shipments it has not authorised in writing.
These clauses decide who carries the cost when an order goes wrong. Fill in the inspection window, payment days and warranty period first, since finance and receiving teams have to live with them. Liability and governing law are the two your counsel will most want to check.
4. Inspection and rejection [Buyer Company] may inspect the goods within [7] days of delivery and reject any that are damaged, defective or do not match this order. Rejected goods are returned at [Supplier Name]'s risk and expense, and [Buyer Company] may choose a refund, a credit or a replacement. Payment for goods does not mean they have been accepted. 5. Invoicing and payment [Supplier Name] will send invoices to [AP Email] after delivery, quoting the purchase order number. [Buyer Company] will pay each accurate, approved invoice within [30] days of receipt. [Buyer Company] may withhold or set off any amount it disputes in good faith while the dispute is resolved. 6. Warranties [Supplier Name] warrants that the goods and services match this order and any agreed specification, are new, are free from defects in design, material and workmanship, are of merchantable quality, are fit for the purpose stated in the order and comply with applicable laws, for [12] months from acceptance. 7. Termination and cancellation [Buyer Company] may cancel all or part of this order for convenience at any time before shipment by written notice. In that case [Supplier Name]'s only remedy is payment of its reasonable, documented costs incurred before the notice. [Buyer Company] may also cancel at once by written notice if [Supplier Name] breaches these terms or misses a delivery date. 8. Changes [Buyer Company] may change quantities, delivery dates or specifications by written notice. If a change affects the price or delivery date, the parties will agree the adjustment in a signed change order before the change takes effect. 9. Liability and indemnity [Supplier Name] will indemnify [Buyer Company] against third-party claims arising from defective goods, the supplier's negligence or infringement of intellectual property rights. [Optional: Each party's total liability under this order is limited to [amount or multiple of the order value], except for the indemnity above.] 10. Confidentiality [Supplier Name] will keep confidential all information received from [Buyer Company] under this order and use it only to fulfil the order. This obligation continues after the order is complete. 11. Governing law These terms are governed by the laws of [Jurisdiction]. The parties will first try to resolve any dispute through their named contacts within [30] days, after which the courts of [Location] have exclusive jurisdiction.
| Bracket | Common choice | Who should confirm it |
|---|---|---|
| Inspection window | 5-10 business days for goods | Receiving or warehouse lead |
| Payment days | Net 30 from an accurate, approved invoice | Finance controller |
| Warranty period | 12 months from acceptance | Category owner |
| Cancellation for convenience | Any time before shipment, documented costs only | Procurement |
| Liability cap | Set case by case | In-house or external counsel |
Common choices, not requirements. Set each one to match your own policy.
Small businesses and teams without in-house counsel often need purchase terms and conditions that fit on one page. This version keeps acceptance, price, delivery, inspection, payment and governing law, and drops the clauses that rarely matter on small orders. Switch to the full set once an order passes a value you choose, such as [5,000].
Terms and conditions of purchase: [Buyer Company] Version [1.0], [Date] 1. These terms apply to this purchase order. The supplier accepts them by confirming the order or delivering. Any other terms are excluded. 2. Prices are fixed as shown and include delivery. Taxes are listed separately. 3. Deliver to [Delivery Address] by [Delivery Date]. We may cancel any part of the order delivered late. 4. We may reject goods that are damaged or do not match this order within [7] days of delivery, at your cost. 5. Send invoices to [AP Email] quoting the PO number. We pay correct invoices within [30] days. 6. These terms are governed by the laws of [Jurisdiction].
Add a version number and date so you can prove which terms applied to which order.
How you attach the terms matters as much as what they say. Pick one method per supplier type and use it on every order, so there is never a PO that went out without them. Build the step into your purchase order process rather than leaving it to each buyer.
| Method | How it works | Best for |
|---|---|---|
| Reverse of the PO | Terms printed as page 2 of the PO PDF | Paper or PDF purchase orders |
| Footer link | One line on the PO links to a fixed, versioned page | High volumes of system-generated POs |
| Attached document | Terms sent as a separate PDF with the first PO | New suppliers |
| Master agreement reference | The PO states that the signed contract governs | Suppliers already under contract |
Suppliers often reply with an acknowledgement carrying their own terms, a clash usually called the battle of the forms. Clause 1 states that your terms apply and others are excluded, but how a real clash is settled depends on local law, so ask counsel before relying on it in a dispute.
A terms sheet with an unfilled bracket or an old version number undoes the protection it was written for. Have procurement, finance and legal each sign off the checks in their area. Repeat the review when you change payment terms or enter a new country.
Terms only help if a PO is raised. Spendflo routes every purchase through intake and approvals first.
See how it worksThe rule for which document wins when the PO, the terms and a contract disagree.
When buyer and supplier each send documents carrying their own, conflicting terms.
Goods that match the PO's description, quantity and specification.
Who owns the goods and who bears loss or damage at each point in delivery.
Standard trade terms that set delivery points and costs on cross-border orders.
Clauses, such as confidentiality, that keep applying after the order is complete.
One line on the face of the order naming the terms and their version.
Buyers and suppliers can then point to clause 4 instead of quoting paragraphs.
Terms that promise 30 days when finance pays in 45 create disputes on every invoice.
Low-value orders move faster when suppliers face one page, not five.
Store each retired version with its dates so past orders can be checked against the right text.
Their governing law, liability position and payment days may not fit your business.
Without a precedence clause, a PO can quietly rewrite a negotiated contract.
Terms the supplier never saw are hard to enforce.
An unfilled [X] days gives no inspection window at all.
Set inspection days, payment days, warranty period and governing law with finance and receiving.
Send the full set and the simple version to counsel together, with the checklist.
Save a dated PDF at a fixed link and add that link to the PO template footer.
Email active suppliers the new terms with their next PO, noting the effective date.
Harbour Facilities issues PO-2044 to Acme Office Supply for 120 chairs at 18,000.00, due by 10 October. Only 80 arrive on time. Under clauses 3 and 7, Harbour refuses and cancels the 40 late chairs. Under clause 4, it inspects the 80 within 7 days, accepts them and pays 12,000.00 under clause 5. Figures are illustrative.
Every part on this page, in Word, Google Docs and PDF, with the examples filled in.
Delivery, inspection, title and risk carry the most weight. Add packaging rules and an Incoterm for imports.
Swap delivery for performance and acceptance criteria. Add ownership of work product and rules for the supplier's staff on site.
The vendor's own agreement usually governs, so the PO should reference it. Add data protection and licence scope if no contract exists.
Best for counsel review and tracked changes.
Best for joint editing by procurement and finance.
The fixed version suppliers see.
Spendflo has handled 15,000+ agreements, at 30% average savings on software spend.
See your savingsA clear set of PO terms settles disputes over price, delivery and payment before they start. It cannot stop a purchase that was never approved, so the controls that matter most sit earlier, at intake.
Quick answers to what people ask most about the purchase order terms and conditions template.
Standard PO terms cover eight core areas: acceptance, pricing and taxes, delivery and risk of loss, inspection and rejection, invoicing and payment, warranties, cancellation and governing law. The download sets these out as numbered clauses with sample wording, plus changes, liability and confidentiality.
The terms are the price, quantity, delivery date and payment terms on the face of the PO, plus the standard conditions printed on the reverse or linked in the footer. Download the template to get both the full clause set and a simple one-page version.
Common examples on a PO are a fixed-price clause, a delivery date with a right to cancel late items, an inspection window and payment within 30 days of a correct invoice. You can download sample wording for each one from this page and edit the brackets.
General purchasing terms are the one standard set a buyer applies to every order unless a signed contract says otherwise, usually printed on the back of the PO or linked from its footer. You can download a general set here, with eleven clauses and a one-page version for small orders.
You can download this free template in Word, Google Docs or PDF from this page. It includes the eleven-clause set, the simple version and a review checklist.
Purchase orders
Contracts
Vendor management
Sourcing and RFx
Budgets and business cases
Procurement
Accounts payable
Purchasing
Software buying
Supply chain
Spendflo handles intake, approvals and contracts, so every PO starts from an approved request and a known supplier. Spendflo has handled 15,000+ agreements.
Enter your work email and we'll unlock every format.
Didn't start, or need another format? Pick one below.
Google Docs: upload the file to Google Drive, then open it with Google Docs.
