Blanket purchase order

A blanket purchase order sets purchasing terms for repeated orders over a period. Individual releases specify what is needed and when, allowing a buyer to avoid issuing a completely new agreement for every delivery.

A blanket order can establish a time period, maximum spend, expected volume and agreed prices without requiring all goods to be delivered immediately. The buyer then issues releases against it. Forecast quantities may be estimates rather than guaranteed purchases, so the parties should distinguish planning information from commitments to buy or hold stock.

For example, a warehouse may agree annual prices for packing materials and release quantities every month. Each call-off order confirms what to dispatch against the blanket arrangement. A standing order usually follows a recurring delivery schedule, whereas a blanket order allows the timing and quantity of individual releases to vary.