What is Goods Received Note (GRN) - Ultimate Guide for SMEs

Oct 23, 2021 in Quality and Stores



Businesses these days, whether small or large scale, has many processes running inside them every time. And these processes are essential for their smooth operations. Because these companies have various departments working and they all work in coordination with each other. So, if one of the processes gets not done, it could affect their operating activities. Let's talk about the procurement process as it's one of the core activities. If the Delivery Note and Goods Received Note (GRN) is not perfect, or the employees are not preparing them. Then the communication will get a severe effect between the departments.

Before going into more detail about the usage of GRN and how it is essential for the procurement process, let's understand what it is.

What is Goods Received Note (GRN)?

The GRN (or Goods Received Note) is a 2-way document that verifies that the supplier has delivered the product to the recipient. And this procurement of goods is taking place because of the buyer's Purchase Order.

Further, this document serves as proof that the supplier has fulfilled his obligation as per the agreement with its customer.

Additionally, the meaning that GRN has for the buyers is that it also acts as a quality checking document that verifies their purchases. It confirms that the procurement is happening for the specific quality of products.

Also, it serves as a communication medium between the various departments regarding the purchases.

How do the GRNs help the businesses?

The Goods Received Note helps the businesses in managing their crucial processes, and these are some of the ways how it is necessary for them -

1. Product Verifying document.

This GRN document alone helps verify the quantity and quality of goods for which the procurement process is happening in the organization.

As on the gates of the warehouse, when the supplier delivers the goods, there is no staff available who has given the specific order and can check these items.

So, to verify these goods at the warehouse gate point, only the warehouse staff matches the goods with the Purchase Orders (PO's) and the GRNs.

And if only the products match with the description in these documents. Then only the Goods Receipt Notes get issued to the supplier.

2. Minimizing the Fake Invoices payments.

With the help of Goods Received Note (GRN), the business can stop the Fake invoice Payment.

As through the GRN creation and matching process, the whole Purchase Flow process gets a check.

And the documents like Purchase Requisite Note, Tax Invoices get a double-check with the GRNs, which verifies the quantities ordered from the departments.

Through this matching, only the possibility of any fraud regarding the pricing or extra quantities gets eliminated. And reduces the chances of any extra payments.

3. Auto-Updation of Stock levels and Inventory Management.

The GRN document verifies that a delivery of goods was taking place in the warehouse. Further, this document helps the inventory department in maintaining accurate inventory levels.

And through this process, two tasks of Warehouse Management and Inventory Management for further production and selling process starts.

Way Forward

So to get all these benefits of the GRN document without consuming a lot of time and effort becomes a tough task to manage by the businesses.

And for this task to become easy for them, they need the help of automation software. The business can choose this software from a big pool present in the market. And they should choose only that software that satisfies all their needs. TranZact is such software.

TranZact is a zero-effort digital transformation tool and platform for SMEs to digitize business processes right, from customer inquiry to dispatch. This software helps businesses in all their invoicing needs and their document processing and verifying needs.


TranZact is a team of IIT & IIM graduates who have developed a GST compliant, cloud-based, inventory management software for SME manufacturers. It digitizes your entire business operations, right from customer inquiry to dispatch. This also streamlines your Inventory, Purchase, Sales & Quotation management processes in a hassle-free user-friendly manner. The software is free to signup and gets implemented within a week.