| option (PSM-GPR) |
A line item in an SRM purchasing document that allows purchasers to stipulate the details necessary for ordering the item and leave the decision on whether to order the item until later. A purchaser can, for example, enter a quantity, price, and conditions. However, the purchaser can decide whether or not to exercise the option and order the item at a later date, depending on market or business conditions. The prices and conditions specified when creating the line items will still apply. For example, a purchaser may decide to purchase an item at the price specified six months ago if the market price for the product has increased, and he may decide against it if the market price has fallen below the previously specified price. Also, the purchaser can make this decision depending on whether he is satisfied with other goods or services ordered from the same supplier.