Purchase Order Terms Template and How to Draft One (2026)

What are purchase order terms, and when do you need them? Purchase order terms (often called purchase order terms and conditions) are the standard legal terms a buyer attaches to a purchase order. They turn a simple order into a binding contract that protects the buyer: they set when the order is accepted, the price, delivery, inspection rights, warranties, when title and risk pass, and what happens if goods are late or defective. You need them whenever you buy goods or services regularly and want your own terms, rather than the supplier's, to govern the deal. Below is a purchase order terms template you can copy and adapt, followed by plain-English guidance on how to fill each clause. These terms are usually printed on or linked from the purchase order itself. This is general information, not legal advice. For high-value or regulated purchasing, have a qualified lawyer review your final terms. ## Purchase order terms and conditions template ```

PURCHASE ORDER TERMS AND CONDITIONS These terms apply to Purchase Order No. [PO NUMBER] ("Order") issued by [BUYER NAME] ("Buyer") to [SUPPLIER NAME] ("Supplier"). 1. ACCEPTANCE The Supplier accepts the Order by acknowledging it in writing or by starting to perform. These terms govern the Order and prevail over any conflicting terms in the Supplier's quotation, acknowledgement or invoice, unless the Buyer agrees otherwise in writing. 2. PRICE The price is as stated in the Order and is fixed. It is [inclusive / exclusive] of applicable taxes (e.g. GST/VAT), which will be shown separately. No extra charge applies unless agreed in writing before delivery. 3. DELIVERY The Supplier will deliver the goods/services to [DELIVERY LOCATION] by [DELIVERY DATE], during [hours]. Time is of the essence. The Supplier will notify the Buyer promptly of any expected delay. 4. QUANTITY AND PACKAGING The Supplier will deliver the exact quantity ordered, properly packed and labelled, with a delivery note quoting the PO number. 5. INSPECTION AND ACCEPTANCE The Buyer may inspect goods within [N] days of delivery and reject any that do not conform to the Order or specification. Rejected goods may be returned at the Supplier's cost and risk for refund or replacement. Payment does not imply acceptance. 6. TITLE AND RISK Risk passes to the Buyer on delivery and acceptance. Title passes to the Buyer on the earlier of delivery or payment. 7. PAYMENT The Buyer will pay correct, undisputed invoices within [N] days of the later of acceptance or invoice date. Invoices must quote the PO number. 8. WARRANTY The Supplier warrants that goods/services will conform to the Order and specification, be of satisfactory quality and fit for purpose, be free from defects, comply with applicable law, and not infringe any third party's rights, for [N] months from acceptance. 9. INTELLECTUAL PROPERTY Any materials created specifically for the Buyer under the Order belong to the Buyer on payment. The Supplier grants a licence to use any pre-existing materials needed to use the deliverables. 10. COMPLIANCE The Supplier will comply with applicable laws, including product safety, data protection, anti-bribery and (where relevant) labour and environmental standards. 11. CONFIDENTIALITY The Supplier will keep the Buyer's information confidential and use it only to fulfil the Order. 12. INDEMNITY AND LIABILITY The Supplier indemnifies the Buyer against third-party claims arising from defective goods/services or IP infringement. Liability limits, if any, are as stated in the Order or any governing agreement. 13. TERMINATION / CANCELLATION The Buyer may cancel the Order, in whole or part, before delivery on written notice, or immediately if the Supplier breaches these terms or becomes insolvent. The Buyer pays only for conforming goods/services already delivered. 14. GOVERNING LAW The Order is governed by the laws of [JURISDICTION], and disputes are subject to the [courts of [PLACE] / arbitration seated in [PLACE]].