In certain circumstances, such as when the delivery date changes, the product reaches the wrong address, you don’t need the items anymore, etc., you may need to cancel a purchase order. To request a cancellation, you will need to call their customer service department or write a Purchase Order Cancellation Letter to terminate the order process. Otherwise, you will get yourself into a more complicated process. In this article, we will discuss more of the Purchase Order Cancellation Letter.
What Is a Purchase Order Cancellation Letter?
A purchase order cancellation letter is a type of letter that you can use to request a cancellation or termination of a purchase order that you have submitted to a supplier. Other vendor businesses implement a cancellation policy for purchase orders to set proper expectations for them and their customers to follow.
What are the Components of a Purchase Order Cancellation Letter?
For a more efficient order cancellation process, many businesses allow their customers to do it through an online application. Some even encourage their customers to call their designated customer support. Nevertheless, they still cater to this type of business-to-business transaction through letters and emails. An excellent purchase order cancellation letter format includes the following items.
- Customer’s name
- Order Date
- Order Number
- List of canceled items
- Reason of the cancellation
- Copies of any receipts, invoices or purchase orders
FREE 3+ Purchase Order Cancellation Letter Samples and Templates in PDF
Are you looking for a purchase order cancellation letter template? You are in the right place. Just go over the following downloadable examples and templates and choose the one that fits best for your purpose.
1. Purchase Order Cancellation Letter in PDF
2. Purchase Order Cancellation Letter Example
3. Letter for Cancellation of Purchase order Due to Delay of Delivery
4. Customer Order Cancellation Notification Letter
What are the Best Practices in Writing a Purchase Order Cancellation Letter?
Did you know that according to the statistics that Alexander Kunst of Statista reported on December 20, 2019, as of April 2017, in the United States, the most common reason online shoppers are canceling online orders is the change of mind? Other popular reasons also include very high shipping costs and services charges, long delivery timeframe, unfavorable return policy, and hassle payment options. Some shoppers cancel orders without reason. Lastly, others do so because they hate creating accounts.
Thus, it is normal for people to cancel purchase orders. However, you can’t deny that the cancellation process can be a hassle task. Still, it should not worry you because we have included a set of best practices in creating a purchase order cancellation letter.
1. Secure the Customer’s Name, Order Date, and Order Number
The supplier companies use this information as an order identification. Thus, omitting any of these details can lead to the cancellation process unnecessarily long, which is quite common in the retail industry. Therefore, for a faster process, you need to secure this information first.
2. Check the Items’ Details
Another situation that makes the process of cancellation is the lack of details of the items that the customers wish to cancel. Unless you intend to cancel the entire order, ensure to include the colors, sizes, quantity, and the inventory number of the items of the order that you want to cancel. By doing it, you can also avoid any discrepancies. For example, you intend to cancel only 200 of the 500 items of RJ45 connectors. However, since you forgot to include the number of items you plan to cancel, the supplier assumed that you want to cancel all the RJ45 connectors, which can lead to further issues.
3. Include a Cancellation Reason
Since many companies are implementing a purchase order cancellation policy, it is a good practice to include a reason for the cancellation in your Purchase Order Cancellation Letter. These companies base their cancellation request approval on their policy. Therefore, by including a reason for canceling, you can make the purchase order cancellation process quicker.
4. Attach Supporting Documents
Don’t allow to create an unnecessary long email thread for a single transaction. Include all the relevant information, such as the copies of any receipts, invoices, or purchase orders the first time you send the email. Also, it is a good practice to let the supplier send the receipts to your email for easier data retrieval. You can also do it yourself by taking a screenshot of the receipt and save it on the company’s database.
What is a purchase order?
A purchase order is a document that contains the services or products list and the agreed prices that the buyer wishes to purchase from the seller. Retail companies usually include this document in their enterprise resource planning to maximize the efficiency of the utilization of their resources.
What is the difference between the purchase and the invoice?
As we have mentioned earlier, purchase order orders come from the buyer. Meanwhile, its the suppliers who provide the invoice, which they will give once they receive the payment from the buyer. However, at times, the buyer and supplier can create an agreement with specific payment terms. In this case, the seller will include this payment agreement on the invoice.
Can I consider a purchase order as a contract?
Yes. In fact, a purchase order fundamentally intends to serve as a legally bound contract between you, as the customer and the seller. Meaning, if you refuse to pay with the goods that you purchased, the seller can file a lawsuit to get paid. However, it does not necessarily mean that you cannot protect yourself. Just like any other types of lawsuits, you have the right to hire a lawyer to defend yourself against the claim.
For instance, you have sent a purchase order to the seller. However, for some reason, you decided to cancel it. Unfortunately, the seller filed a lawsuit, saying that you didn’t pay as you promised. The authorities will allow you to get a lawyer to help you express your side. In this case, the Purchase Order Cancellation Letter is one of the pieces of evidence that you can use to defend yourself.
Purchase Order Cancellation Letter is indeed a great tool in running a business. Even though it is not the main tool that you want to use all the time, creating a well-written Purchase Order Cancellation Letter can save yourself from relevant difficulties, making it an essential item to add in your business plan.
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