What's the a Purchase Order (PO) used as a payment Methods in Aladdin's e-Commercial website?
In the context of e-commerce, a Purchase Order (PO) is a commercial document issued by a buyer to a Aladdin, indicating types, quantities, and agreed prices for products or services. It’s not a payment method in itself, but rather a document that authorizes a purchase transaction, which will later be paid for using an actual payment method, such as a credit card, bank transfer, or another method agreed upon by the buyer and Aladdin.
How it Works in E-Commerce of Aladdin:
1. Purchase Order Creation:
The buyer creates a PO with details of the goods/services they wish to purchase and sends it to the Aladdin.
2. Order Review and Acceptance:
Aladdin reviews the PO and, if acceptable, processes the order.
3. Delivery and Invoice:
Once the goods/services are delivered, the Aladdin sends an invoice to the buyer referencing the PO.
4. Payment:
The buyer then pays the invoice using a predetermined payment method, referencing the PO number.
Implementing Purchase Order in Aladdin’ E-Commerce Websites:
1. User Interface:
Aladdin platform should allow buyers to select “Purchase Order” as a payment method and enter a PO number if they have one.
2. Verification:
Aladdin have a system for verifying PO numbers, especially if they are provided by the buyer.
3. Invoice Generation:
Once the order is fulfilled, Aladdin system should generate an invoice, referencing the PO number, and send it to the buyer.
4. Payment Collection:
Aladdin system needs to track the payment against the specific invoice and update the order status once payment is received.
Benefits of Using Purchase Orders in Aladdin’s E-Commerce website:
1. Clear Documentation:
POs provide clear documentation of what was ordered, making it easier to resolve discrepancies between orders and deliveries.
2. Improved Financial Control:
They allow businesses to control and track their expenditures more accurately, as each PO has detailed information about the order.
3. Enhanced Legal Protection:
Legally, a PO can serve as a contractual document between buyer and Aladdin in case of disputes.
Considerations:
• In B2C transactions, POs are not typically used, as customers usually pay for goods/services directly using methods like credit cards, debit cards, or digital wallets.
• However, in B2B transactions, especially where large quantities or amounts are involved, POs are more common as they allow businesses to manage and control their purchasing processes more effectively.
• Offering POs as a payment method might involve more administrative work and require more robust financial tracking systems.