The flows
The purchase side
Everything on the sales side has a mirror here. The documents are the same; what changes is which of you posts and which of you reads.
Most companies start with the sales side, because that is where the customer is asking for it. The purchase side is where the saving usually is, because that is where people are typing.
The four documents, the other way round
| Document | Direction | What happens |
|---|---|---|
| Order | Out to the supplier | Confirming a purchase order sends it |
| Order confirmation | In from the supplier | Their answer lands on the purchase order |
| Despatch advice | In from the supplier | What is on its way, before it arrives |
| Invoice | In from the supplier | Matched against the order and the receipt |
Sending an order
Confirming a purchase order sends it, where an outbound agreement exists for that supplier. The supplier gets the order in their system without anyone rekeying it, which removes the most common source of a wrong delivery: a line typed twice.
Taking a confirmation
An incoming confirmation says what the supplier will actually deliver. It is staged and compared first, the same as any inbound document, and the comparison is against the purchase order you sent: the prices you agreed, the quantities you asked for, the dates you wanted.
A confirmation that agrees on everything can update the purchase order by itself. One that changes a price or a date waits, because that is a decision rather than an update. That is exactly the case you want a person to see, and the one that is currently invisible when confirmations arrive as PDFs.
Receiving against a despatch advice
An incoming despatch advice tells you what is coming and, where the supplier packs to licence plates, exactly how it is stacked. The receipt can then be booked against the document rather than counted at the door.
Two routes are available, and which one you want depends on how you work. A warehouse-managed receipt registers against the shipment so the goods can be scanned in. A journal receipt posts the receipt directly. Neither is more correct; the first suits a warehouse with scanners, the second suits a stores area with a keyboard.
Matching supplier invoices
An incoming supplier invoice is staged and compared against the purchase order and the receipt. Where the three agree, it can be posted without a person. Where they do not, the difference is shown: a price that moved, a quantity that does not match what was received, a line that was never ordered.
Acknowledgements, both ways
The receipts work the same in both directions. You answer your suppliers' documents if you have agreed to, and you expect answers to yours. A supplier who never acknowledges your orders is a supplier whose orders you cannot prove arrived, and acknowledgements covers what to do about it.
Where to start
With one supplier, and with the invoice. It is the flow with the clearest saving and the one where a mistake is caught by the matching rather than by a customer. Add the order and the confirmation once the invoices are posting cleanly.