What is PunchOut

Always wondered what PunchOut is? Or did you just recently get a request for a punchout connection from one of your customers? 

1. About PunchOut

PunchOut methods allow companies to give their employees access to a supplier's webshop from a link or button within the procurement system (ERP). The ERP sends information which automatically logs the employee into the webshop. Once the employee is logged in, he or she can fill a shopping cart in the webshop as usual. Once this process is completed, the selected products are not paid for, but returned to the purchasing package. (This means no actual order has been placed yet!)

Within the procurement system an approval flow is activated. Once all necessary approval has been given, the ERP package automatically sends an order confirmation to the supplier, who can then proceed with delivery. If the supplier sends digital invoices, the ERP package can often automatically match these with the purchase order.

An example of the information flow between the ERP package and the webshop.

2. Types of PunchOut

In practice, there are 2 different versions of PunchOut. Although the user experience of both versions is the same, the technical implementations differ. 

OCI PunchOut

was developed by SAP and uses the standard HTTP POST and GET functions to login the customer into te webshop and return the contents of the shopping cart.
More explanation about the technical implementation of OCI PO.

cXML PunchOut

is developed by Ariba and sends cXML (commercial XML) files back and forth to the ERP package to allow the customer to log in, return the shopping cart, and modify orders.
More explanation about the technical implementation of cXML PO.

The implementation that is most suitable for you depends on the wishes of the customers, and on the purchasing package that they use. In general, it can be said that an OCI PunchOut implementation is easier to set up than a cXML PunchOut integration. In practice, many vendors choose one of the two implementations, and use an OCI to cXML converter if the customer expects a different form of PO.

3. Why should you offer PunchOut to your customers?

Most vendors only learn about PunchOut integrations after they are asked to provide them by customers. It is also increasingly common for tenders/tendering processes to explicitly ask for PunchOut capabilities with the existing ERP package. Customers who have a PunchOut connection with your webshop are generally more loyal, order more often and usually pay their invoices faster (because they can easily match incoming invoices with purchase orders).

Buyers from customers who do not order via PunchOut can often choose for themselves which suppliers they place an order with. In practice, this often means that one buyer will order from 'Webshop A', while another buyer prefers 'Webshop B'. When using Punchout integrations, there are often only a limited number of webshops displayed in the ERP. As a result, a customer will place more orders with the same webshop.