A client agrees to your quote, then instead of paying, sends over a document called a purchase order and asks you to reference its number on your invoice. If you have never worked with a larger company before, this can feel like a delay or a new hoop to jump through. It is neither. A purchase order is simply how bigger organisations formally commit to a payment internally, and understanding it makes the process faster, not slower.
Here is what a purchase order actually is, why a client sends one, and exactly what to do with it.
A purchase order is a commitment to pay, not the payment itself
A purchase order, usually abbreviated PO, is a document a company's finance or procurement team issues internally to authorise a specific spend, in this case your invoice, before it is paid. It typically includes a PO number, the agreed amount, and a description of what is being purchased. Receiving one is a good sign, not a delay tactic, since it means the client's finance process has actually approved the spend rather than leaving it dependent on one person remembering to pay you.
Larger companies, and increasingly mid-sized ones, use POs as a standard control: no invoice gets paid without a matching PO already on file. If a client asks for one to reference, it usually means their accounts payable team requires it before they can even process your invoice, not that they are stalling.
What to actually do when a client sends a PO
Reference the exact PO number on your invoice, usually in a dedicated field near the top or in the description line, worded exactly as the client's document states it. A mismatch here, even a small formatting difference, is one of the most common reasons an invoice gets stuck in a large company's accounts payable queue, since automated systems often match PO numbers exactly rather than fuzzily. See the guide on what a GST-compliant freelance invoice needs for everything else that field should include alongside the PO reference.
Confirm the amount on the PO matches what you actually agreed before invoicing against it. If the numbers differ, even slightly, flag it with your contact before sending the invoice rather than after, since a mismatch between your invoice and the PO on file is exactly the kind of discrepancy that triggers a manual review and delays payment further.
What if the client never sends a PO but the invoice still stalls
If you have not received a PO and payment is delayed, ask directly whether one is needed: "Just checking, does your team need a PO number on this invoice before it can be processed?" Some companies use POs only for certain vendor categories or amount thresholds, so a first-time freelance vendor might not automatically get one issued unless someone requests it internally. This one question often unblocks a stalled payment faster than repeated follow-ups on the invoice itself.
See the guide on following up on an overdue invoice for the general escalation sequence if the payment still does not move once the PO question is settled.
Small clients rarely use POs, and that is fine
Solo entrepreneurs, small agencies, and individual clients almost never issue purchase orders, since the internal approval process a PO exists to formalise usually does not exist at that scale. Do not ask a small client for one or worry that its absence signals anything wrong. POs become common specifically once a client is large enough to have a separate finance or procurement function reviewing spend before it happens.
Rinto keeps each client's invoice history in one place, so once you know a specific client's finance team always wants a PO number referenced, checking what the last invoice included is a quick look rather than trying to remember or dig through old email threads before sending the next one.
Frequently Asked Questions
What is a purchase order and why did my client send me one?
A purchase order is a document a company's finance or procurement team issues internally to formally approve a specific spend before it is paid. If a client sends you one, it usually means their accounts payable process requires a matching PO number before your invoice can even be processed, not that they are trying to delay payment. Receiving a PO is generally a positive sign that the spend has already been internally approved, and it tends to mean the eventual payment is more predictable, not less.
Do I need to do anything special with a PO number on my invoice?
Yes, reference the exact PO number on your invoice, worded precisely as it appears on the client's document, usually in a dedicated field or the description line. Automated accounts payable systems at larger companies often match PO numbers exactly, so even a small formatting difference can cause the invoice to get stuck in review rather than paid promptly. Double-check the number before sending rather than relying on memory once you have used it once.
Is a purchase order the same as payment?
No, a purchase order is an internal approval to spend, not the actual payment. You still need to send an invoice referencing the PO number and go through the client's normal payment process afterward. Think of the PO as clearing the internal approval hurdle, while your invoice is what actually triggers the payment itself once that hurdle is cleared, so receiving one is progress, not the finish line.
What should I do if my invoice is stuck and I never received a PO?
Ask your contact directly whether their team requires a PO number before your invoice can be processed. Some companies only issue POs for certain vendor types or spending thresholds, so a first-time freelance vendor might not automatically receive one unless someone internally requests it. This single question often unblocks a stalled payment faster than repeated invoice follow-ups that never address the actual cause of the delay, since chasing the invoice itself does nothing if a PO is the real missing piece.
Do small clients or individuals ever issue purchase orders?
Almost never. Purchase orders exist to formalise an internal approval process that typically only exists once a company is large enough to have a dedicated finance or procurement function reviewing spend. A solo client or small agency generally has no reason to issue one, so its absence is completely normal and not something to flag or worry about with those clients, and asking a small client for a PO usually just confuses them.