Creating and managing suppliers for purchase orders

Suppliers are the businesses that you source products from and place purchase orders with. Effective supplier management helps you maintain good relationships, ensure reliable inventory flow, and track payment terms and currencies. When you create a purchase order, you can add a new supplier or edit an existing supplier, and you can include payment information that's specific to each order.

Supplier payment terms and currency

You can include optional details about the payment terms for the purchase order from your supplier. Payments to suppliers must be paid outside of your Shopify admin, using a payment method that you organize with your supplier.

Before you place a purchase order, you need to consult with your supplier to agree on payment terms and a currency. Payment terms cover scenarios such as payment on delivery, payment on receipt, payment in advance, or payment within a set number of days after the order.

The supplier currency on purchase orders defaults to the supplier's currency. If you agree to pay in another currency, then you can change the Supplier currency using the currency selector. This updates all pricing-related fields in the purchase order to display in the new currency, so you can keep track of the pricing and purchases that aren't made with your default currency.

Payment terms and supplier currencies are specific to individual purchase orders, and aren't saved as default values to any specific supplier.

Create a supplier

You can create a supplier in your Shopify admin. After you create a supplier, they're listed in the Select supplier drop-down menu when you create purchase orders.

Steps:

1. From your Shopify admin, go to Products > Purchase orders.

2. Click Create purchase order.

3. In the Supplier section, click the Select supplier drop-down menu.

4. Click Create new supplier.

5. Enter the supplier's details, and then click Save.

View a supplier's details

You can view a supplier's information, including their contact information, address, and recent purchase order line items.

The supplier's details are organized into separate cards, such as contact information and address. The Recent purchase order line items section displays the products that you've ordered from this supplier on previous purchase orders. You can search the line items list and page through the results.

Steps:

1. From your Shopify admin, go to Products > Purchase orders.

2. Click Create purchase order or click an existing purchase order.

3. In the Supplier section, click the Select supplier drop-down menu, and then choose the supplier that you want to view.

4. Click View details.

5. If you created a new purchase order, then you can delete the draft purchase order.

Edit a supplier's details

When you edit the details of a supplier, the details are updated in all existing purchase orders. You can edit each card independently, such as contact information and address.

Steps:

1. From your Shopify admin, go to Products > Purchase orders.

2. Click Create purchase order or click an existing purchase order.

3. In the Supplier section, click the Select supplier drop-down menu, and then choose the supplier that you want to edit.

4. Click View details.

5. On the card that you want to update, edit the supplier's details.

6. Click Save.

7. If you created a new purchase order, then you can delete the draft purchase order.

Best practices for supplier relationship

Building and maintaining good relationships with your suppliers is essential for smooth inventory operations. Consider the following best practices for supplier relationship management:

• Communication: Keep suppliers informed about your business needs and any changes to orders.
• Payment reliability: Honor agreed payment terms to maintain trust and potentially negotiate better terms.
• Order planning: Provide suppliers with advance notice for large orders or seasonal requirements.
• Quality feedback: Communicate about product quality issues promptly and constructively.
• Documentation: Keep clear records of all agreements, pricing, and order history.

Managing multiple suppliers

If you work with multiple suppliers, then consider the following strategies:

• Diversification: Don't rely on a single supplier for critical products.
• Performance tracking: Monitor supplier reliability, quality, and delivery times.
• Cost comparison: Regularly review pricing and terms across suppliers.
• Relationship building: Invest time in building strong relationships with key suppliers.
• Contract management: Maintain clear agreements on terms, quality standards, and delivery expectations.