{"id":2767,"date":"2021-03-25T14:44:00","date_gmt":"2021-03-25T18:44:00","guid":{"rendered":"https:\/\/www.certitrek.com\/nlpa\/2009\/09\/25\/cost-of-a-purchase-order-the-great-mystery-of-procurement\/"},"modified":"2023-11-30T11:08:55","modified_gmt":"2023-11-30T15:08:55","slug":"cost-of-a-purchase-order-the-great-mystery-of-procurement","status":"publish","type":"post","link":"https:\/\/www.certitrek.com\/nlpa\/blog\/cost-of-a-purchase-order-the-great-mystery-of-procurement\/","title":{"rendered":"Cost of a Purchase Order:  The Great Mystery of Procurement"},"content":{"rendered":"<p>One of the most common questions in procurement \u2013 and the one that has never seemed to have a definitive answer is \u2013 \u201chow much does it cost to process a <a href=\"https:\/\/www.certitrek.com\/nlpa\/blog\/what-is-a-purchase-order\/\" target=\"_blank\" rel=\"noopener\">purchase order<\/a>?\u201d I get asked this question so much that I have decided to dedicate this blog post to it.<\/p>\n<p>Ask 10 \u201cexperts\u201d what the cost of a purchase order is and you\u2019re likely to get 10 different answers. Here are a few stabs that people have made at answering this elusive question\u2026<\/p>\n<ul>\n<li>A 2006 report from APCQ found that the cost of a purchase order differed depending on the capabilities of the procurement department on a continuum from bottom performer to the top performer. This report indicated that the cost of a purchase order ranged from $35.88 to $506.52.<\/li>\n<li>A 1994 study by the Environmental Protection Agency on its own processes revealed that some of its procurement officials had estimated the cost of a purchase order to be as high as $300, but published a conservative estimate of $94.20 per PO.<\/li>\n<li>The Supply Management Handbook says \u201cit often costs organizations more than $100 in administrative expenses to generate a purchase order\u201d and that \u201cin many firms, the cost of managing and generating a purchase order can exceed $200 per transaction.\u201d<\/li>\n<li>CAPS Research indicates that the cost per purchase order varies by industry, from $59 in industrial manufacturing to a whopping $741 in the petroleum industry with the average being $217.<\/li>\n<\/ul>\n<p>Would one of these benchmarks apply to your organization? Maybe, maybe not.<\/p>\n<p>There are many variables, including the procurement department\u2019s capabilities, the industry, the organization\u2019s specific processes, the systems used, etc. If you want a number that is true to your organization, you\u2019d really need to track everything involved with an order; know the salaries of each individual who gets involved in an order; amortize the price paid for systems by the number of purchase orders generated over the life of the systems; know the telecommunications and\/or paper costs; factor in overhead costs such as facilities, supervision, and benefits, etc.<\/p>\n<p>The cost of obtaining such information would likely outweigh the benefits of having that information. This is a true example of a situation with the potential for \u201cparalysis by analysis.\u201d So you may just want to pick a number out of the range of benchmarks I previously mentioned \u2013 like $100, $150, or $200 \u2013 being as conservative as you need to be to fit the culture of your organization and go with it.<\/p>\n<p>Fill out our subscription form below to stay up to date with our helpful tips and topics from our blog.<\/p>\n<p class=\"p1\"><span class=\"s1\"><a href=\"https:\/\/lms.nextlevelpurchasing.com\/\"><b>NLPA Learning<\/b><\/a><\/span><span class=\"s2\"><b>:<\/b> Looking for authoritative procurement templates, tools, webinars, and more? Stop trying to create resources from scratch and start taking advantage of having exactly what you need right at your fingertips in <span class=\"s1\">NLPA Learning<\/span>.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>One of the most common questions in procurement \u2013 and [&hellip;]<\/p>\n","protected":false},"author":12,"featured_media":4016,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-2767","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-procurement"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v19.4 (Yoast SEO v19.13) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Cost of a Purchase Order: The Great Mystery of Procurement<\/title>\n<meta name=\"description\" content=\"One of the most common questions in procurement \u2013 and the one that has never seemed to have a definitive answer is \u2013 \u201chow much does it cost to process a purchase order?\u201d\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.certitrek.com\/nlpa\/blog\/cost-of-a-purchase-order-the-great-mystery-of-procurement\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Cost of a Purchase Order: The Great Mystery of Procurement\" \/>\n<meta property=\"og:description\" content=\"One of the most common questions in procurement \u2013 and the one that has never seemed to have a definitive answer is \u2013 \u201chow much does it cost to process a purchase order?\u201d\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.certitrek.com\/nlpa\/blog\/cost-of-a-purchase-order-the-great-mystery-of-procurement\/\" \/>\n<meta property=\"og:site_name\" content=\"Next Level Purchasing Association (NLPA)\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/NextLevelPurchasing\/\" \/>\n<meta property=\"article:published_time\" content=\"2021-03-25T18:44:00+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2023-11-30T15:08:55+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/www.certitrek.com\/nlpa\/wp-content\/uploads\/sites\/5\/2020\/11\/nlpa-images-026.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"1600\" \/>\n\t<meta property=\"og:image:height\" content=\"1280\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"Galo Matagay\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@nextlevelpurch\" \/>\n<meta name=\"twitter:site\" content=\"@nextlevelpurch\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"Galo Matagay\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/blog\/cost-of-a-purchase-order-the-great-mystery-of-procurement\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/blog\/cost-of-a-purchase-order-the-great-mystery-of-procurement\/\"},\"author\":{\"name\":\"Galo Matagay\",\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/#\/schema\/person\/72d094fab77892483dfa6e061cb27eaa\"},\"headline\":\"Cost of a Purchase Order: The Great Mystery of Procurement\",\"datePublished\":\"2021-03-25T18:44:00+00:00\",\"dateModified\":\"2023-11-30T15:08:55+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/blog\/cost-of-a-purchase-order-the-great-mystery-of-procurement\/\"},\"wordCount\":466,\"publisher\":{\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/#organization\"},\"articleSection\":[\"Procurement\"],\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/blog\/cost-of-a-purchase-order-the-great-mystery-of-procurement\/\",\"url\":\"https:\/\/www.certitrek.com\/nlpa\/blog\/cost-of-a-purchase-order-the-great-mystery-of-procurement\/\",\"name\":\"Cost of a Purchase Order: The Great Mystery of Procurement\",\"isPartOf\":{\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/#website\"},\"datePublished\":\"2021-03-25T18:44:00+00:00\",\"dateModified\":\"2023-11-30T15:08:55+00:00\",\"description\":\"One of the most common questions in procurement \u2013 and the one that has never seemed to have a definitive answer is \u2013 \u201chow much does it cost to process a purchase order?\u201d\",\"breadcrumb\":{\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/blog\/cost-of-a-purchase-order-the-great-mystery-of-procurement\/#breadcrumb\"},\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/www.certitrek.com\/nlpa\/blog\/cost-of-a-purchase-order-the-great-mystery-of-procurement\/\"]}]},{\"@type\":\"BreadcrumbList\",\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/blog\/cost-of-a-purchase-order-the-great-mystery-of-procurement\/#breadcrumb\",\"itemListElement\":[{\"@type\":\"ListItem\",\"position\":1,\"name\":\"Home\",\"item\":\"https:\/\/www.certitrek.com\/nlpa\/\"},{\"@type\":\"ListItem\",\"position\":2,\"name\":\"Cost of a Purchase Order: The Great Mystery of Procurement\"}]},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/#website\",\"url\":\"https:\/\/www.certitrek.com\/nlpa\/\",\"name\":\"Next Level Purchasing Association (NLPA)\",\"description\":\"The Next Level Purchasing Association\",\"publisher\":{\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/#organization\"},\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":{\"@type\":\"EntryPoint\",\"urlTemplate\":\"https:\/\/www.certitrek.com\/nlpa\/?s={search_term_string}\"},\"query-input\":\"required name=search_term_string\"}],\"inLanguage\":\"en-US\"},{\"@type\":\"Organization\",\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/#organization\",\"name\":\"Next Level Purchasing Association (NLPA)\",\"url\":\"https:\/\/www.certitrek.com\/nlpa\/\",\"logo\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/#\/schema\/logo\/image\/\",\"url\":\"https:\/\/www.certitrek.com\/nlpa\/wp-content\/uploads\/sites\/5\/2020\/08\/NLPA-logo-small-1.png\",\"contentUrl\":\"https:\/\/www.certitrek.com\/nlpa\/wp-content\/uploads\/sites\/5\/2020\/08\/NLPA-logo-small-1.png\",\"width\":149,\"height\":50,\"caption\":\"Next Level Purchasing Association (NLPA)\"},\"image\":{\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/#\/schema\/logo\/image\/\"},\"sameAs\":[\"https:\/\/www.linkedin.com\/company\/next-level-purchasing-association\/\",\"https:\/\/www.youtube.com\/channel\/UCrNZYjcLcaNA4xMKQHEGamw\",\"https:\/\/www.facebook.com\/NextLevelPurchasing\/\",\"https:\/\/twitter.com\/nextlevelpurch\"]},{\"@type\":\"Person\",\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/#\/schema\/person\/72d094fab77892483dfa6e061cb27eaa\",\"name\":\"Galo Matagay\",\"image\":{\"@type\":\"ImageObject\",\"inLanguage\":\"en-US\",\"@id\":\"https:\/\/www.certitrek.com\/nlpa\/#\/schema\/person\/image\/\",\"url\":\"https:\/\/secure.gravatar.com\/avatar\/34d4be7be9c43eeb480e7e32739c2f3f?s=96&d=mm&r=g\",\"contentUrl\":\"https:\/\/secure.gravatar.com\/avatar\/34d4be7be9c43eeb480e7e32739c2f3f?s=96&d=mm&r=g\",\"caption\":\"Galo Matagay\"},\"description\":\"Lorem ipsum dolor sit amet, consectetur adipiscing elit. Aenean consequat rutrum ipsum quis iaculis. Duis non porta purus, tincidunt tristique mi. Cras eleifend tincidunt mollis. Aliquam egestas velit vitae interdum egestas. Aliquam vel lorem egestas lectus porttitor volutpat nec sit amet enim. Nullam bibendum vestibulum imperdiet.\"}]}<\/script>\n<!-- \/ Yoast SEO Premium plugin. -->","yoast_head_json":{"title":"Cost of a Purchase Order: The Great Mystery of Procurement","description":"One of the most common questions in procurement \u2013 and the one that has never seemed to have a definitive answer is \u2013 \u201chow much does it cost to process a purchase order?\u201d","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/www.certitrek.com\/nlpa\/blog\/cost-of-a-purchase-order-the-great-mystery-of-procurement\/","og_locale":"en_US","og_type":"article","og_title":"Cost of a Purchase Order: The Great Mystery of Procurement","og_description":"One of the most common questions in procurement \u2013 and the one that has never seemed to have a definitive answer is \u2013 \u201chow much does it cost to process a purchase order?\u201d","og_url":"https:\/\/www.certitrek.com\/nlpa\/blog\/cost-of-a-purchase-order-the-great-mystery-of-procurement\/","og_site_name":"Next Level Purchasing Association (NLPA)","article_publisher":"https:\/\/www.facebook.com\/NextLevelPurchasing\/","article_published_time":"2021-03-25T18:44:00+00:00","article_modified_time":"2023-11-30T15:08:55+00:00","og_image":[{"width":1600,"height":1280,"url":"https:\/\/www.certitrek.com\/nlpa\/wp-content\/uploads\/sites\/5\/2020\/11\/nlpa-images-026.jpg","type":"image\/jpeg"}],"author":"Galo Matagay","twitter_card":"summary_large_image","twitter_creator":"@nextlevelpurch","twitter_site":"@nextlevelpurch","twitter_misc":{"Written by":"Galo Matagay","Est. reading time":"3 minutes"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"Article","@id":"https:\/\/www.certitrek.com\/nlpa\/blog\/cost-of-a-purchase-order-the-great-mystery-of-procurement\/#article","isPartOf":{"@id":"https:\/\/www.certitrek.com\/nlpa\/blog\/cost-of-a-purchase-order-the-great-mystery-of-procurement\/"},"author":{"name":"Galo Matagay","@id":"https:\/\/www.certitrek.com\/nlpa\/#\/schema\/person\/72d094fab77892483dfa6e061cb27eaa"},"headline":"Cost of a Purchase Order: The Great Mystery of Procurement","datePublished":"2021-03-25T18:44:00+00:00","dateModified":"2023-11-30T15:08:55+00:00","mainEntityOfPage":{"@id":"https:\/\/www.certitrek.com\/nlpa\/blog\/cost-of-a-purchase-order-the-great-mystery-of-procurement\/"},"wordCount":466,"publisher":{"@id":"https:\/\/www.certitrek.com\/nlpa\/#organization"},"articleSection":["Procurement"],"inLanguage":"en-US"},{"@type":"WebPage","@id":"https:\/\/www.certitrek.com\/nlpa\/blog\/cost-of-a-purchase-order-the-great-mystery-of-procurement\/","url":"https:\/\/www.certitrek.com\/nlpa\/blog\/cost-of-a-purchase-order-the-great-mystery-of-procurement\/","name":"Cost of a Purchase Order: The Great Mystery of Procurement","isPartOf":{"@id":"https:\/\/www.certitrek.com\/nlpa\/#website"},"datePublished":"2021-03-25T18:44:00+00:00","dateModified":"2023-11-30T15:08:55+00:00","description":"One of the most common questions in procurement \u2013 and the one that has never seemed to have a definitive answer is \u2013 \u201chow much does it cost to process a purchase order?\u201d","breadcrumb":{"@id":"https:\/\/www.certitrek.com\/nlpa\/blog\/cost-of-a-purchase-order-the-great-mystery-of-procurement\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/www.certitrek.com\/nlpa\/blog\/cost-of-a-purchase-order-the-great-mystery-of-procurement\/"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/www.certitrek.com\/nlpa\/blog\/cost-of-a-purchase-order-the-great-mystery-of-procurement\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/www.certitrek.com\/nlpa\/"},{"@type":"ListItem","position":2,"name":"Cost of a Purchase Order: The Great Mystery of Procurement"}]},{"@type":"WebSite","@id":"https:\/\/www.certitrek.com\/nlpa\/#website","url":"https:\/\/www.certitrek.com\/nlpa\/","name":"Next Level Purchasing Association (NLPA)","description":"The Next Level Purchasing Association","publisher":{"@id":"https:\/\/www.certitrek.com\/nlpa\/#organization"},"potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/www.certitrek.com\/nlpa\/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-US"},{"@type":"Organization","@id":"https:\/\/www.certitrek.com\/nlpa\/#organization","name":"Next Level Purchasing Association (NLPA)","url":"https:\/\/www.certitrek.com\/nlpa\/","logo":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.certitrek.com\/nlpa\/#\/schema\/logo\/image\/","url":"https:\/\/www.certitrek.com\/nlpa\/wp-content\/uploads\/sites\/5\/2020\/08\/NLPA-logo-small-1.png","contentUrl":"https:\/\/www.certitrek.com\/nlpa\/wp-content\/uploads\/sites\/5\/2020\/08\/NLPA-logo-small-1.png","width":149,"height":50,"caption":"Next Level Purchasing Association (NLPA)"},"image":{"@id":"https:\/\/www.certitrek.com\/nlpa\/#\/schema\/logo\/image\/"},"sameAs":["https:\/\/www.linkedin.com\/company\/next-level-purchasing-association\/","https:\/\/www.youtube.com\/channel\/UCrNZYjcLcaNA4xMKQHEGamw","https:\/\/www.facebook.com\/NextLevelPurchasing\/","https:\/\/twitter.com\/nextlevelpurch"]},{"@type":"Person","@id":"https:\/\/www.certitrek.com\/nlpa\/#\/schema\/person\/72d094fab77892483dfa6e061cb27eaa","name":"Galo Matagay","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/www.certitrek.com\/nlpa\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/34d4be7be9c43eeb480e7e32739c2f3f?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/34d4be7be9c43eeb480e7e32739c2f3f?s=96&d=mm&r=g","caption":"Galo Matagay"},"description":"Lorem ipsum dolor sit amet, consectetur adipiscing elit. Aenean consequat rutrum ipsum quis iaculis. Duis non porta purus, tincidunt tristique mi. Cras eleifend tincidunt mollis. Aliquam egestas velit vitae interdum egestas. Aliquam vel lorem egestas lectus porttitor volutpat nec sit amet enim. Nullam bibendum vestibulum imperdiet."}]}},"acf":[],"_links":{"self":[{"href":"https:\/\/www.certitrek.com\/nlpa\/wp-json\/wp\/v2\/posts\/2767"}],"collection":[{"href":"https:\/\/www.certitrek.com\/nlpa\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.certitrek.com\/nlpa\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.certitrek.com\/nlpa\/wp-json\/wp\/v2\/users\/12"}],"replies":[{"embeddable":true,"href":"https:\/\/www.certitrek.com\/nlpa\/wp-json\/wp\/v2\/comments?post=2767"}],"version-history":[{"count":3,"href":"https:\/\/www.certitrek.com\/nlpa\/wp-json\/wp\/v2\/posts\/2767\/revisions"}],"predecessor-version":[{"id":11681,"href":"https:\/\/www.certitrek.com\/nlpa\/wp-json\/wp\/v2\/posts\/2767\/revisions\/11681"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.certitrek.com\/nlpa\/wp-json\/wp\/v2\/media\/4016"}],"wp:attachment":[{"href":"https:\/\/www.certitrek.com\/nlpa\/wp-json\/wp\/v2\/media?parent=2767"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.certitrek.com\/nlpa\/wp-json\/wp\/v2\/categories?post=2767"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.certitrek.com\/nlpa\/wp-json\/wp\/v2\/tags?post=2767"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}