Using Purchase Contracts on Purchase Orders

After you have created purchase contract records, you can select a Purchase Contract in the form header field when you are entering a purchase order. Then, the purchase order is associated with the contract and the following occurs:

The department, class, location, and terms fields all autofill from the selections made on the contract. These will also default on lines items where applicable.
Terms for the contract apply to the entire order.
Items added to the purchase order are priced based on the contract.
The contract tracks item quantities and currency amounts on the purchase order to use for pricing and discount calculations.

Note:

If you use NetSuite OneWorld and the selected vendor is shared with multiple subsidiaries, note the following. The purchase contract list is based on the selected vendor and all assigned subsidiaries.

Even if you choose a header contract, you can also have multiple contracts associated with multiple lines on one purchase order. When you select a contract for a line item, the contract shown on each line determines the rate for the quantity on that line.

When you add the line, NetSuite calculates item rate using the appropriate tiered pricing rates and criteria.

For example, on a purchase order line, you can select an item and enter a quantity and expected receipt date. Then, the Purchase Contract list displays all valid contracts to choose from. The choice is based on whether the contract effectivity is the expected receipt date or the purchase order date. Based on the contract you select for the line, NetSuite calculates the appropriate rate. The rate is based on the quantity you order and how the contract is set up to calculate purchase order lines.

If the quantity entered for that line results in more than one rate applied to items on that line, note the following. The rate shown is a blended rate based on all applicable rates on that line.

After the purchase order is saved, you can open the order in View mode and can click the Rate link on a line. This opens the Purchase Rate Detail window which shows the specific rates applied to specific quantities on that line.

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