Purchase order software: inventory tools versus procurement tools for a small business

Purchase order software comes in two kinds, and small businesses usually need the first

Purchase order software is either an inventory system that creates purchase orders and receives the goods into stock, or a procurement tool that routes purchase requests through approvals and matches invoices. A small business that buys products to resell or build with needs the first kind. A company that wants to control what employees spend on services, software and supplies needs the second.

The difference shows up at receiving. In an inventory system, receiving a purchase order raises stock on hand and updates product cost. In a procurement tool, receiving confirms that an invoice can be paid.

Purchase order software for small business: entry prices compared

Prices can change. Each figure comes from the vendor's own pricing page.

What each purchase order tool is best at, and one limitation

• Zoho Inventory: lowest cost way to send purchase orders and convert them to bills. Limitation: purchase orders per month are capped by plan, at 300 on Standard and 1,500 on Premium.
• SOS Inventory: the Companion plan already includes purchase orders, POs generated from stock levels, partial receiving, blanket POs and drop shipments. Limitation: multiple vendors per item and returns to vendors need Plus ($139.95 per month), and landed costs need Pro ($194.95 per month).
• inFlow Inventory: purchase orders tied to reorder points for each location, scan-to-receive on the mobile app, and bills pushed to QuickBooks Online or Xero. Limitation: PO approvals are part of advanced access rights, which is a $69 per month add-on on Core and is included on the higher plans.
• Sortly: simple POs built from your item list. Limitation: it is an item tracker, so there is no sales order side.
• Tradogram: purchase orders, supplier management and invoice workflows from $99 per month. Limitation: it does not manage stock for resale.
• Precoro: approval workflows and invoice matching for growing teams. Limitation: the entry price is about five times Tradogram's.
• Procurify: spend control with three-way matching. Limitation: no public price.

Where inFlow Inventory fits for purchasing, and where another tool is better

inFlow Inventory fits when purchase orders are part of a stock cycle. Its purchasing page describes setting a reorder point per product and location, then restocking by purchase order, stock transfer or manufacture order. Receiving can be done on the web or mobile app, including scanning lots, serial numbers and expiry dates on the way in. The reorder point guide shows how to set those numbers, and the receiving checklist covers the dock.

Another tool is the better pick in three cases. If you send fewer than 20 purchase orders a month and have one user, Zoho Inventory's free plan costs nothing. If your books are in QuickBooks Online and you want the lowest-cost inventory add-on, SOS Inventory Companion is $69.95 per month. If the real problem is that staff buy without sign-off, a procurement tool such as Tradogram handles requests and approvals that an inventory system does not.

A short test for any purchase order software

Run the same four steps in each trial before paying:

1. Create a purchase order for three items from one vendor and email it.
2. Receive two of the three items and leave one open. Check that the order shows as partly received.
3. Confirm that stock on hand and item cost changed after receiving.
4. Push the bill to your accounting software and check the vendor, quantities and amounts.

Tracking open orders afterwards is its own habit. The purchase order status guide lists the stages worth tracking. QuickBooks users should read the QuickBooks purchase order comparison next.