Difference between Purchase Order and Purchase Requisition in SAP MM

In SAP MM, a Purchase Requisition is a formal request to procure goods or services, initiated by a department or individual within an organization. It serves as an internal document that triggers the purchasing process.

A Purchase Order, on the other hand, is a legally binding document issued by the buyer to the vendor, outlining the specific details of the goods or services to be purchased, including quantities, prices, delivery dates, and terms of payment.

Key differences between Purchase Order and Purchase Requisition in SAP MM:

• A Purchase Requisition is an internal request, while a Purchase Order is a formal agreement with a vendor.
• A Purchase Requisition initiates the procurement process, while a Purchase Order finalizes the purchasing transaction.
• A Purchase Requisition does not commit any financial obligation, whereas a Purchase Order represents a binding agreement to pay for the goods or services.

Understanding the distinction between Purchase Order and Purchase Requisition is essential for effectively managing the procurement process in SAP MM.