5 Steps to Simplify Purchase Order Workflow with Airtable

Words by
Tanzi Khakimova
Written on
November 30, 2023
Last updated on
December 4, 2023

Managing purchase orders efficiently is a strenuous process because of the number of people involved: creating a purchase order, sending it for approval, sending it to a supplier, tracking the shipment, paying the invoice, and inspecting the delivery.

What if you are not at the scale where you need or are ready to pay for specialized procurement software but your business still depends on maintaining the right inventory levels?

Enter Airtable: a customizable tool that’s easy to use, allows you to have a single source of truth for your data, and supports your team’s unique process.

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What is a Purchase Order Workflow in a Small Business?

A purchase order workflow for a small business is an essential process that involves managing and tracking the various stages of purchasing goods or services. It plays a crucial role in ensuring smooth operations and maintaining accurate inventory levels. The workflow typically includes several steps that need to be followed to complete a purchase order.

Step 1: Create a Purchase Request

This involves identifying the need for a product or service and documenting the details such as quantity, specifications, and delivery requirements.

Step 2: Approve the Purchase Request

Once the purchase request is created, it needs to go through an approval process. This step ensures that the purchase aligns with the budget, procurement policies, and any other necessary criteria.

Step 3: Submit PO to Supplier

After obtaining the necessary approvals, the next step is to submit the purchase order to the suppliers. This involves communicating the details of the purchase, such as product specifications, quantity, and delivery instructions. Effective communication with suppliers is crucial to ensure that the order is accurately fulfilled and delivered on time.

Step 4: Track Shipment

Once the purchase order is submitted, it is essential to track the shipment. This involves monitoring the progress of the order, obtaining tracking information from the supplier, and ensuring that the delivery is on schedule. Tracking shipments helps in managing expectations, identifying any delays or issues, and taking appropriate actions to resolve them.

Step 5: Receive and Inspect

Once the goods or services are received, the next step in the workflow is to inspect the delivery. This involves verifying the quality, quantity, and condition of the received items. Any discrepancies or issues need to be documented and addressed promptly to ensure accurate inventory control.

Step 6: Pay Invoice

Finally, the last step in the purchase order workflow is to pay the invoice. This involves reviewing the invoice, matching it with the purchase order and delivery, and making the necessary payment. Timely payment ensures a good relationship with suppliers and helps in maintaining smooth business operations.

What are Challenges or Problems that Arise in the purchase order workflow?

Some of the common challenges we see include:

  1. Complexity: Managing the various stages of purchasing goods or services involves multiple steps and coordination between different parties. This complexity can lead to errors, delays, and inefficiencies.
  2. Communication: Effective communication is crucial throughout the workflow, especially when submitting purchase orders to suppliers. Miscommunication or incomplete information can result in incorrect or delayed orders.
  3. Approval process: Obtaining approvals for purchase requests can be time-consuming, especially if there are multiple layers of approval or complex budgetary considerations. Delays in approvals can impact the timely fulfillment of orders. Other times, this approval step is simply skipped, meaning there are inadequate controls over purchasing decisions.
  4. Tracking and monitoring: Tracking the shipment and ensuring timely delivery requires continuous monitoring and coordination with suppliers. Without proper tracking mechanisms, it can be challenging to manage expectations and address any delays or issues promptly.
  5. Inventory control: Accurate inventory control is essential to ensure that the right products are ordered and received in the correct quantities. Inaccurate inventory records can lead to overstocking or stockouts, affecting business operations and profitability.
  6. Payment processing: Managing the payment process, including reviewing invoices, matching them with purchase orders and deliveries, and making timely payments, can be time-consuming and prone to errors if not properly streamlined. We sometimes see accountants having to dig through paper or disparate email records for adequate support when they are processing payments.

It becomes essential to streamline the purchase order workflow to minimize errors, save time, and ensure accurate inventory control.

Using Airtable to Manage Your Purchases and Inventory

Streamlining the purchase order workflow using a tool like Airtable can help address these challenges and improve efficiency, accuracy, and accountability throughout the process.

Airtable, a customizable project management and collaboration tool, can simplify and automate the purchase order workflow in five steps.

Step 1: Define the steps of your typical purchase order workflow

It may involve various steps, such as creating purchase requests, obtaining approvals, submitting orders to suppliers, and updating inventory records.

Here is a screenshot of the workflow views we set up in Airtable for our imaginary healthcare-tangent example:

Step 1: define steps in your workflow

Note that with Airtable, you can set up automated approval workflows based on predefined rules.

Once a purchase request is submitted, it can be automatically routed to the appropriate approver based on criteria like budget limits or departmental requirements. This streamlines the approval process, reduces delays, and ensures accountability.

Step 2: Create a product list

This list will include all the products that follow the same ordering process. It is a good practice to include all the details defining the inventory in your storage locations: SKU, weight, supplier, and even the barcode that you would be able to read when using an Airtable app to create a purchase order for low-running stock, for example.

Step 2: Define the products you're purchasing

Step 3: Create a vendors (or manufacturers) list

These vendors should be approved for purchases. Having contact details, such as email, contact person's name, and phone number, will be helpful in streamlining communications. When it's time to place an order, you can easily generate and send purchase orders directly from Airtable.

Step 3: List your vendors

[Optional] List your storage (or warehouse) locations

If your clinic has several storage locations (e.g. supply room, laundry room, kitchen, etc., or separate warehouses for a larger business), create a list of all the places where inventory may land. This way, you will be able to create a purchase order and tie it to the appropriate location right away, thanks to the relational connection Airtable creates between your storage locations and products.

Step 4: Define your warehouses or locations

See an Example in Airtable

Have a look at this short example of an Airtable base we have built for an imaginary client from a healthcare-tangent industry.

Wrap Up

Efficient purchase order management is crucial for the smooth operation of a business.

By leveraging Airtable's features, such as streamlined approval processes, enhanced supplier communication, and order tracking, anyone can simplify and automate their purchase order workflow. This not only saves time and reduces errors, but also improves inventory control and ensures accountability.

Cue North can help you create a workflow and database in Airtable that’s right for your organization and team. Book a call to get started.

Tanzi Khakimova
Tanzi Khakimova
Design and Implementation Consultant

Scaling organizations and amplifying social impact through data, processes and digital products.