Let us begin by taking a 30,000 foot view of the purchasing process. Putting together a purchasing system requires several steps, and initially it can be confusing for people new to ERP systems. But when you break the steps down and look at them individually the process becomes much easier to understand.
When you set up a supplier you are determining the individuals or companies that are providing you with products. In OpenERP it is perfectly possible to create a product and sell it without implementing a purchasing system. However, to begin using your system for purchasing you will need to configure the suppliers.
The steps you take when setting up a supplier are much the same as setting up a customer. In fact, now is as good a time as any to tell you that OpenERP maintains core customer, employee, and supplier records all in the same model (or table) named res.partner. Sometimes suppliers are also referred to as vendors.