Nowadays, practically all business transactions are carried out online, either through the use of an e-commerce website or an app, as opposed to the old method of transacting in person. The procure-to-pay (P2P) process in your business, which begins with a straightforward purchase order and ends with payment of a vendor invoice, is ripe with possibilities for optimization and advancement. Punchout catalogs offer one such chance. With the integration of a user-friendly e-commerce-style shopping experience that complies with your business’s internal controls and agreed-upon terms and prices, these hosted catalogs are used to give purchasing organizations a direct link to a supplier’s products and services. Therefore, B2B e-commerce vendors who provide punchout catalogs make the purchasing process faster for their customers. We will explain what a punchout catalog is, how it functions, what types there are, and how it benefits both suppliers and buyers in this article.
What Is a Punchout Catalog?
A punchout catalog is a B2B e-commerce website with the unique capability to interface with a procurement process directly through cXML. And deliver a pending purchase order to the customer, saving them time. And effort of entering product information into the procurement system. It contains a feature that enables seamless connectivity to the e-procurement system or platform of a buyer.
What Is a Procurement System?
An organization can streamline the process of procuring products and services and keep track of inventory by using a procurement system. The management of procurement-related processes includes sending buy requests. Also creating purchase orders, choosing and overseeing vendors, approving delivered products and services, and reviewing invoices.
Punchout Catalog Working Principle
The end user from the purchasing company joins the seller’s online catalog after punching out their procurement application (such as SAP Ariba, Coupa, Jaggaer, Oracle, SAP, etc.). While both programs are connected, the user adds goods to their shopping cart. The shopping cart with the chosen items is passed back to the procurement software when the end user is prepared to complete the transaction. The traditional business-to-consumer (B2C) checkout process is not encountered by the end user. The order is then forwarded through their company for finance approval after the cart has been put back into the procurement software. A buy order is generated by the process and forwarded to the vendor for fulfillment when the order has been approved.
Types of Punchout Catalogs
Let’s examine the various types of punchout catalogs and some of their features.
- Level 1 punchout catalogs: The buyer can access a level 1 punchout catalog from the home page of their e-procurement system. In their e-procurement system’s punchout catalog area, pre-approved vendors will have a logo. The buyer chooses a supplier’s logo and enters the supplier’s e-commerce website after being verified. The customer is directed to the main page, where they can search and explore products. This style of punchout workflow is supported by the vast majority of e-procurement platforms.
- Level 2 punchout catalogs: It combines a punchout website and a CIF catalog to offer a single shopping experience for punchout catalogs and catalogs kept in the procurement system such as Ariba Buyer. Level 2 punchout is also referred to as Level II punchout. Before punching out to the e-commerce store, the buyer can do searches within the e-procurement marketplace and examine rudimentary product details using a level 2 punchout catalog. The search results page will read “punchout to view price” rather than a price. The end user punches out and is immediately directed to the product page in the vendor’s e-commerce punchout catalog, where they can add the item to their shopping cart or find out more information that may not have been available in the e-procurement system such as additional attribute details, material safety data sheets (MSDS), warranty claims, instructions, or product configurations.
Benefits of a Punchout Catalog to the Supplier
There are numerous advantages of punchout catalogs to suppliers. Here are some examples.
- They do not have to bother with manually updating every one of their customers with the latest pricing, line-item descriptions, shipping details, etc.
- Optimal pricing, a simple shopping process, and guided purchases increase customer retention. Directly inside the system, they can provide unique discounts and limited-time offers, use coupon codes, etc.
- Integration makes invoicing simpler, more reliable, and transparent, which enhances suppliers’ capacity to control their cash flow as well as financial forecasting and reporting. Additionally, within the bounds of the buyer’s contractual duties and capacities, it gives providers the chance to upsell. Suppliers have the chance to make use of their intellectual property, brand reputation, etc. through branded integrations.
Benefits of a Punchout Catalog to the Customer
If you are a customer, there are a number of reasons why you will want to use a punchout catalog.
- A simplified shopping experience: B2B connection provides customers with immediate access to comprehensive product catalogs within your e-procurement system. Additionally, shopping carts, promotional coupons, and other elements that define the e-commerce experience are integrated so that customers may efficiently and simply find what they need. Customers may access the complete supply chain thanks to single sign-on (SSO) support without having to manage login information for numerous different e-commerce sites. Additionally, you can easily and automatically create a purchase requisition or order and route it for approval thanks to connectivity with your procurement application. To expedite the process even more, you can specify budget thresholds for automatic approvals.
- Information management: Punchout catalogs are updated by suppliers and made available online, so customers may obtain greater information about products including availability, current sales, and associated shipping costs. This data is typically updated in real-time by the vendors.
- Multiple business task capability: An integrated procurement solution permits users and customers to process integrated buy orders, return products, receive order confirmations, track shipping, submit orders, receive invoices, and view vendor bills.
Bid old, erroneous purchasing goodbye and welcome punchout catalogs’ accuracy and adaptability. You can increase the transparency of your spending and the control you have over your purchasing procedures by directly integrating the catalogs of your suppliers with your procurement system. Additionally, through shared data management, quick and accurate payments, and joint prospects for success, you will develop better, more cooperative relationships with your suppliers.