PunchOut Technology — A Game Changer for B2B E-commerce websites

In e-commerce businesses, “PunchOut” seems to be a bit of a buzzword, but it is actually crucial in growing e-commerce for large customers.
Let’s take a look at it in more detail.

What is PunchOut Technology?
This is a method for corporate purchasing agents to buy from suppliers’ e-commerce websites without leaving their procurement applications.

What is PunchOut Website?
In simple term, PunchOut website is just an instance of a seller’s ecommerce website which is available from within the buyer’s eProcurement platform so that it helps buyers to manage the entire procurement process from within their eProcurement platform.

It has the ability to communicate with a procurement system via CXML and sending pending purchase order back to the buyer’s procurement system so that they do not need to enter product catalog information in procurement software itself.

PunchOut Process :

1. Buyer searches for a suitable pre-approved supplier in their eProcurement platform
2. They choose a supplier and are immediately forwarded to the supplier’s ecommerce store.
3. Authentication is handled automatically, and the buyer is logged in to their account on the ecommerce store.
4. The buyer chooses products for their cart as usual. The seller retains control of the ecommerce catalog and can present a custom product selection and personalized discounts to the buyer.
5. When the buyer is finished, instead of checking out, they punchout: order data is automatically transferred to the eProcurement platform for approval.
6. When the order is approved, a purchase order is created in the supplier’s ecommerce store.

So here we need to focus on following goals.

1. Custom screen layout for punch out enabled items with faster search capability and custom checkout workflow.
2. Single signon from procurement to website
3. Send Order data to from website to ecommerce
4. Send approved order from procurement app to website so that new purchase order can be created in e-commerce website .

Traditional Procurement System:

Inside traditional procurement systems, buyer agent needs to enter supplier catalog items when a purchase order was being created or the item would be located in the procurement system master catalog and added to the purchase order.
Over time, procurement systems gained the ability to import supplier catalogs directly into the procurement system. The buying organization, often the purchasing department, had the responsibility to enter the catalog information, convert it from one electronic form to another, and maintain costs.

Catalog Interchange Format(CIF)

Ariba® introduced the Catalog Interchange Format (CIF) which is a standardized electronic file format for supplier catalogs. It eliminates the need for buyers to manually enter item information or file conversion from one format to another. Through the CIF standard, suppliers could easily publish catalogs and buyers could easily import them.

It is good for catalogs that infrequently change. If a supplier sells a item or performs a service that stays the same for a long period of time, a CIF file is the best way to communicate catalogs.

In case of normal consumers, an e-commerce website is an alternative to static product catalog. But for a corporate purchasing agent who works within a procurement system , its not possible to access an external supplier website.Even if it were possible, there was no standard way to automatically enter the item information from the website into the procurement system.

In case of static catalog, it has the inability to exchange information with e-commerce website which further increases extra effort for purchasing department. To address this problem, an electronic document interchange standard called the Commerce eXtensible Markup Language (cXML) and PunchOut concept was introduced by the cxml.org industry consortium.

CIF vs PunchOut

CIF catalog is always static where a PunchOut website is a dynamic product which provides current information, product configuration, and real-time price and availability.

Pros of PunchOut

1. Real-time availability.
2. Cost-efficient procurement.
3. Increase order accuracy.
4. Increased buyer retention.

Integrations

There are two approaches to integration:
1. Custom Integrations. — It takes much time to make existing e-commerce to punch out compatible as it involves a different workflow .
2. Cloud gateways. — this gateway is capable of ingesting data from a wide variety of ecommerce and eProcurement platforms, mediating communication between incompatible systems.
PunchOut2Go is a cloud gateway for punchOut .

Nowadays, integration for e-procurement systems with e-commerce websites has been a challenge and PunchOut technology helps to overcome it easily.