How to Write a Purchase Order Termination Letter (with Samples)

Cancelling a purchase order is quite common, and businesses expect a certain number of orders placed to be cancelled by consumers. The best way to cancel a purchase order is by phone.

This will quickly stop the order from being processed. However, it is also a good idea to send a purchase order cancellation letter for purchase orders that take longer to process as well as to formally verify a cancelled purchase.

Consumers should not wait to cancel a purchase. It is more likely the cancellation will be effective if the time between the purchasing and cancellation is short. Some companies have a time limit in which cancellations must be made.

Most Common Reason

Businesses also cancel purchase orders. The most common reason for cancelling an order is when a supplier doesn’t honor their commitment and fails to deliver the goods on the agreed date. 

Cancelling a purchase is usually disappointing because the consumer or business was counting on receiving the products, but, even if they feel disappointed and somewhat angry, they should be polite when writing a letter.

If the consumer decided that they cannot afford the products or do not need them, they should also feel free to cancel their order. The letter should be short and firm, giving all the required information in a clear format.

The information that should be included in the cancellation letter:

• The name of the customer
• The date the order was placed
• The order number of the items being cancelled
• A list of name of items being cancelled
• A list of items not being cancelled if they are on the same purchase order
• The list should include the size, color, quantity and inventory number of the items being cancelled
• The time the cancellation should be completed
• The reason for the cancellation (optional)
• A request for written confirmation of the cancellation
• Copies of any receipts, invoices or purchase orders

Give A Reason?

If the product or goods were received and found to be faulty or not as advertised, this could be mentioned in the letter. However, it is not essential for an individual consumer to give a reason. 

A business that is cancelling a shipment of goods, should give a reason. Even with proof of a good reason for cancelling, the cancellation is not complete until the other party acknowledges or agrees with it.

Here are two examples of a purchase order cancellation letter, one is from a business and one is from an individual consumer. Certified mail should be used for either of these letters because it will provide the customer with proof of the date and time the cancellation letter was received.

This information may be necessary if any dispute later occurs about the order processing. For example, a business may say they didn’t receive the letter in time to stop the purchase, but the date they received the letter is before the date the goods were sent.

Letter from a business:

Sample 1 – Purchase Order Termination Letter

COMPANY LETTERHEAD

Name of Company Representative who is cancelling the order
Name of Company
Address of Company
City, State, Zip Code

DATE

Name of Company
Name of Person responsible for taking orders
Address of Company
City, State, Zip Code

Dear NAME of RESPONSIBLE PERSON:

This letter is a formal request to cancel the order REF. NUMBER that I placed with you on DATE. It is for DOLLAR AMOUNT.

As agreed by you, the goods were to be delivered to this address on or before DATE. Today is five days past the agreed date, and we have not received any notice from you about the delay.

I expect you will credit our account with a full refund for AMMOUNT that was paid according to the agreement signed by both of us within 10 working days. I have enclosed a copy of the agreement. Kindly send written confirmation of my cancellation.

If you have any questions you can reach me at Name@email.com or at 555-123-4567. Thank you for your quick attention to this matter.

Sincerely,

Signature of business representative
Printed Name of business rep
List of enclosures

Letter from an individual:

Sample 2 – Purchase Order Termination Letter

Name of consumer
Address of consumer
City, State, Zip Code

DATE

Name of Company
Address of Company
City, State, Zip Code

RE: Cancellation of order number NUMBER

Dear Sir/Madam:

This letter is to formally inform you that I am cancelling order number NUMBER and request a full refund. The amount of the order is DOLLAR AMOUNT. I placed the order on DATE. Enclosed is a copy of the invoice. The items on the order to be cancelled are:

• Three light blue T-shirts, size L, inventory number NUMBER
• One beige tunic, long sleeved, size L, inventory number NUMBER

Thank you for your attention to this matter. I expect written confirmation of this cancellation from you and to see a full refund within 10 working days. If you have any questions, I can be reached at Name@email.com or at 555-123-4567.

Sincerely,

Signature of consumer
Printed name of consumer
List of enclosures

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