A purchase requisition is an internal document used by employees to request approval to buy goods or services on behalf of an organization. It is typically submitted through a standardized form and reviewed by supervisors, the finance team, or the procurement staff before any purchase is made. Unlike a purchase order, it is not sent to suppliers. It is strictly for internal authorization purposes.
In a standard procurement cycle, the purchase requisition is usually the first formal step where the need is identified by the employee or department. Once the purchase requisition is submitted, it is then reviewed by managers and the finance department. It is then forwarded to the procurement department for review and vendor selection. Once a vendor has been selected, the purchase order is issued to the supplier, goods or services are delivered, invoice is issued, and payment is made accordingly.
The purchase requisition step mainly ensures that purchases are planned, justified, and aligned with company budgets before funds are committed.
Organizations implement purchase requisitions to control spending, enforce budgets, prevent unauthorized purchases, maintain financial records for audits, standardize procurement processes, and improve forecasting and reporting. They are especially valuable in larger organizations where financial oversight may become more challenging without proper processes.
Some small companies can sometimes bypass formal purchase requisitions when teams are very small and communication is direct, purchase volumes are low, or approval layers would slow operations. Instead, they may rely on informal approvals or simple expense tracking. However, as businesses scale, adopting purchase requisitions into the purchasing workflow becomes necessary.
Purchase requisitions are internal approval requests. Unlike purchase orders which are issued to external vendors or suppliers, purchase requisitions are purely internal documents. While a purchase order is legally binding and is issued after purchase approval, purchase requisitions are not binding and are issued to initiate purchases before approval.
A typical purchase requisition includes the requester's information (including their name, department, and immediate supervisor), the item or service description, quantity, estimated price or budget, preferred vendor (optional), required delivery date, business justification, and approval signatures/ statuses.
These information help decision-makers evaluate necessity, cost, and compliance with policies.
In ERP, procurement, or workflow systems purchase requisitions are digitized and automated. Common system features include integrated approval workflow (such as approval routing based on rules or amount limits), budget validation before approval, vendor database integration, audit trails and change logs, notifications, and reminders.
Digital purchase requisitions reduce manual paperwork, reduce human errors, and improve visibility across departments.
