What is a punchout?

John O'rourke

John O'rourke

5 Minute read December 2020

Another slice of toast pops up – burned one side, soft bread on the other – and Jill had had enough. Work was hard enough already, with the recent fiasco with her biggest customer, Acme Corp, over the stock level spreadsheet. Half an hour later, she’d compared seven new toasters on the website of Jack’s Appliances and ordered one for next day delivery. It amazed her how easy that was compared to the order handling process she had to go through at work each day.

 

She’d barely sat down at her desk when the phone lights up.  It’s Fred from Acme, annoyed as usual, asking why his order for four palettes of kettles that he emailed over yesterday had been given a seventeen week lead time by one of Jill’s sales team, even though Monday’s email from Jill with the latest stock figures showed plenty available. Jill spoke with Joe from the sales team later that morning, and only after reviewing the email thread carefully, discovered that Fred’s order hadn’t been specific about the model number of the kettles he wanted, and from his description, Joe had assumed a different model number that was still on its way over from China.

 

Jill was exasperated; she called John in IT.  “Can’t we do something about this?  Acme has this new purchasing system which they said would make it easier for us to process the orders they send us, but all it’s done is send beautifully formatted PDF documents. Fred still can’t type out an order to save his life so now we get beautifully formatted nonsense!  What’s the point?”

 

John and his team had set up a website for Acme last year, the idea being that staff there could see what stock was available and easily order it.  It was a simple online shop, using the Shopify system, but there were two big reasons it never got used; Fred, and Acme.  Fred constantly forgot his password, or forgot to create a PO number – having this website didn’t help him, because to use it, he had to create the order on the website, then manually type it all in to Acme’s purchasing system, so that it could send a PO over to Jill.  Acme wouldn’t pay Jill’s invoices without a matching purchase order number.

 

John remembered something his contact in Acme’s IT department, Julie, had mentioned.  He called her up and Julie described a process called “punchout”.

 

“It’s really easy for the user; they click through from our purchasing system straight to your website, see stock levels, choose products, and that creates a purchase requisition on our side.  Fred can then submit the requisition, Acme’s finance dept get notified automatically, and provided it’s within Fred’s budget it’ll get approved and sent through to you electronically as a PO!”

 

“Sounds fantastic!” said John, “but what if he still puts the wrong product code in?”

 

Julie laughed. “Easy! Fred doesn’t have to enter any product codes or prices. He just chooses the products on your website, like you’d choose them on Amazon at home. That data goes straight into the requisition, and straight onto the purchase order which comes back to you.  That way, when you get a PO, you know it’ll match up exactly to your system.”

 

John was worried. It was coming up to the year end and his IT budget was already stretched. Julie had mentioned that their Coupa system used something called “cXML” to integrate this way.  Searching the web, John found that lots of purchasing systems used this technology, so it could work for their other large corporate customers too.

 

Later, John found a service called Punchout Hub, which could connect Acme’s Coupa purchasing system with his Shopify website. John, Julie and the team at Punchout Hub had to spend a bit of time testing the new setup, but within a few weeks, the first PO arrived.  It was from Fred, who had managed to order four pallets of toasters without having to call Jill.

 

Jill bit into her evenly cooked toast, savouring the sound it made, and how, for once, it was not being interrupted by a call from Fred.

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