Table of Contents
What is PunchOut Catalogue?
A PunchOut catalogue is a software tool in which a buyer’s e-procurement application allows direct access to a supplier’s eCommerce website. The term “PunchOut” describes the action that the buyer takes: when accessing their internal and familiar e-procurement system (such as SAP Ariba or Coupa), the user “punches out” from this platform into the supplier’s catalogue.
Rather than following through to the checkout system, the buyer returns their order to their eProcurement system as a requisition. This requisition can still be added to, cancelled or edited and is not sent to the merchandiser until the requisition is approved. The buyer’s system automatically sends it through electronically as a purchase order and once the website receives this, it automatically downloads their order into the supplier’s order management system.
How Does a PunchOut Catalogue Work
- The buyer finds the merchandiser link in their internal system
- They are automatically logged in to the website, and their individual details (name, email, shipping address) are transferred over
- They shop as normal, adding items to the basket
- At the checkout, they don’t enter further details and instead the order is brought back into their purchasing system as a requisition
- Internally, their order is approved – eg. their manager may need to approve it
- Once approved, their system automatically sends it through electronically as a purchase order
- The website receives this and automatically downloads the order into the supplier’s order management system
Why are Buyers Asking Their Suppliers to Provide PunchOut Catalogues?
Many large corporations are now using e-procurement software due to its ease of control, removal of paperwork and saving of staff time. It is likely the majority of companies will adopt eProcurement in the future as B2B purchasing edges closer to what we are familiar with in B2C. The pitfalls found in supply chains during the pandemic has further encouraged the use of technology in purchasing. For example, the UK government has encouraged government-funded businesses to consider a supplier’s use of technology, such as eProcurement systems if they are to trade with them.
Large companies have internal purchasing systems to help control the buying and approval process. They may have many users who all need to purchase from the buyer’s website, and it can be hard to manage if each buyer has their own password, placed orders on the account and have no approval process internally; PunchOut is able to remove many of these barriers to purchase. These large companies are setting the standard for B2B purchasing by enforcing that merchants offer a PunchOut catalog if they wish to supply their business. By offering a Punchout, suppliers protect current agreements and open opportunities for new ones.
Benefits of a PunchOut Catalogue
As previously mentioned, suppliers are pressed by their buyers to invest in PunchOut catalogue capabilities in order to retain customers and win new ones. As eProcurement is still relatively unknown amongst merchants, it is possible to have not fully explored how this online platform will affect their business. Innovative suppliers view eProcurement as a clear strategic advantage, investing in PunchOut catalogue and automation technology to make it easy for transactions between the two parties to take place. These suppliers are providing a simpler method for their customers to purchase, as the technology is available 24/7, rather than when someone is available to take their call. Some of the benefits found amongst merchants we have worked with include:
- Retained business
- New sales opportunities
- Decrease cost to serve by eliminating manual order entry
- Preferred vendor status and exclusive opportunities with major eProcurement platforms.