Home Virto Commerce blog The Essentials of PunchOut Catalogs in B2B eCommerce

The Essentials of PunchOut Catalogs in B2B eCommerce

Feb 22, 2024 • 15 min

When your daily work involves ordering and purchasing products or services from multiple suppliers, creating orders and entering them into the CRM becomes an additional challenge that no one likes.

To alleviate this unnecessary stress, PunchOut technology was invented. PunchOut is a popular B2B procurement automation tool that allows you to place orders directly from your existing procurement software.

In this article, we will explain how PunchOut works, the pros and cons of this technology, and how to integrate it into your ecommerce site.

Introduction to PunchOut Catalogs

The core idea of Punch Out is to export a product catalog from the supplier's ERP system or website to the buyer's ERP system or e-procurement application for convenient corporate purchasing. Let’s dive into more details to discover all ins and outs of the technology.

What is a PunchOut

PunchOut is a system where the seller’s product catalog is integrated with the buyer’s CRM or ERP system. It looks like a normal seller’s website built in your CRM or ERP but with some smart features. It allows customers to buy goods straight from their CRM with no need to log in, check out, create purchases in the system, and so on. 

The technology was widely implemented in the 2000s, before the modern era of B2B ecommerce portals and marketplaces. Still, many large companies and government agencies actively use PunchOut because of its user-friendliness and the inertia of the established business processes in large companies. Accordingly, integrating PunchOut systems with modern B2B ecommerce portals and marketplaces has become vital. 

Why is it called PunchOut

The name of the technology is literary related to the moment when you want to punch out from your tasks quickly! Instead of finishing your purchase by creating a purchase order and sending it to the accountant, you just put what you need in the cart as usual and punch out: the system will do the rest of the paperwork. 

What is a PunchOut catalog

Basically, a PunchOut Catalog is a normal items catalog of the products the seller has in stock. The only difference is that it can link to the buyer’s e-procurement solution and grant easy access to all products on their website without leaving the buyer’s e-procurement system. All the functions of a standard catalog are present!

What is the purpose of a PunchOut

PunchOut catalogs provide benefits for both buyers and sellers: the buyer gets transparency of pricing and terms, a streamlined ordering process, and increased efficiency of the whole working process, while the seller gets more loyal clients and more purchases due to more convenience. This solution best fits the medium size and large companies that often buy for the following purposes: 

  • To get tools and accessories to produce what they sell; 
  • To get equipment for maintenance or repair; 
  • To resell what they bought with some margins added; 
  • Or just to standardize their procurement processes. 

PunchOut catalogs allow buyers to easily browse and search for products from their preferred suppliers, all within their own procurement application. This can save much time compared to manually searching and ordering products.

They also provide sellers with a way to showcase their products and services to potential customers highly efficiently. By making it easy for buyers to find and compare PunchOut catalogs from different suppliers, sellers can increase their chances of winning business.

What is a B2B PunchOut

For B2B eCommerce, PunchOut technology is the easiest way to reach the target buyer easily. B2B PunchOut is actually just a working B2B eCommerce website optimized well to fit in the interface of the customer’s eProcurement solution. 

B2B PunchOut is a complex system that requires fine configuration. However, many vendors offer this solution as a simple addon or extension. 

eCommerce PunchOut not only makes it easier to purchase but also helps to build a personalized approach as the system identifies a buyer as an individual and can offer special pricing or related products for up sales and cross sales. 

Schedule a demo with our B2B eCommerce expert.

Punchout Catalogs, APIs, EDI - Technologies for B2B eCommerce

Although this post is about PunchOut technology, it's fair to point out that there are other ways to integrate vendor and buyer computerized trading systems in B2B. This includes using APIs and EDI, so I will briefly discuss them to expand your knowledge in this area.

In modern B2B commerce, there are several technologies for buyers to work with supplier directories. The choice of method depends on the digital maturity of the company, its size, established business practices, and the availability of an in-house development team that can implement the most advanced technologies on the customer side. 

  • A hosted catalog is the simplest way to share vendors’ product catalogs with buyers. The vendor exports its product catalogs in a universal format, such as excel, and places them in a password-protected folder on the website for download. This is a static form of catalog data exchange. It is primitive because the information in these files is updated sporadically, and not all items in the catalog may have actual prices. The customer has to additionally contact the vendor's sales team to clarify the price and availability of the selected items. 
  • APIs (application program interfaces) are a set of protocols that govern how one application can send a request to another. In other words, an API connects one machine and software to another via a local network or the Internet. API is widely used for software integration in many e-commerce applications. API is a peer-to-peer communication like PunchOut technology and doesn’t require an operator for exchange between a buyer and supplier. 
  • EDI technology stands for electronic data interchange, which is the transmission of commercial information such as purchase orders, invoices, change requests, and so on in a standardized format that each partner's system can process. The advantages of EDI include improved competitiveness by forming relationships with suppliers and customers who use it. Currently, EDI is mainly implemented in the retail industry. 

Is PunchOut an EDI?

EDI is not a peer-to-peer communication like PunchOut technology or API. It requires an EDI operator in the middle to exchange messages between a buyer and supplier. This is like the talk of two persons using mobile phones through an operator. 

PunchOut, on the contrary, interacts directly from the buyer’s side to the seller’s eCommerce catalog, only verifying log-in details via a PunchOut gateway. 

Moreover, EDI only offers the exchange of the static information like price lists and documents. It doesn’t offer any interactivity and shopping experience, as EDI is not a real-time technology. 

Basically, EDI is a kind of an old-fashioned PunchOut version. They offer entirely different capabilities in terms of buying, which means PunchOut technology is a better solution.

What is ERP PunchOut?

A B2B PunchOut catalog is an e-procurement platform that allows clients to access a distributor's catalog from their ERP system. PunchOut-enabled customers do not have to leave their ERP system to order goods from a verified supplier.

What is PunchOut in a supply chain?

PunchOut technology makes it easier for supply chain specialists to purchase the correct goods. They use their usual procurement system to order exactly what was discussed with a supplier. This leads to the following improvements: 

  • The company gets products from a reliable vendor. 
  • The numbers are always correct as the system counts them automatically. 
  • The whole supply chain works faster due to the ability to build invoices and purchase orders automatically, with no need to spend time doing it manually. 

How Does a Punchout Catalog Work?

Technically, a PunchOut catalog is an online supplier catalog that is developed with an open catalog interface to support PunchOut procurement related to a customized PunchOut website. The PunchOut ecommerce solution enhances the structured relationship between an e-procurement system of the buyer or ERP and the vendor's storefront.

The PunchOut system is designed, so the vendor isn't notified when the customer makes any purchase. The buyer's e-procurement system serves as a processor for the items in the shopping cart. This makes it very easy for customers to migrate between different product catalogs.

It is important to note that a PunchOut catalog stands as the most effective way for customers to examine a vendor's catalog. Also, it's a convenient way to place orders using an e-procurement system.

The PunchOut Journey

A customer interested in buying a product leaves—or “punches out” of—their procurement application and moves to the seller's webspace or e-catalog. The buyer can then shop and add items to their cart while a connection is established between the buyer’s procurement application and the supplier’s web-based catalog.

When the buyer wants to place an order, the cart and items are sent back to the buyer's procurement application, and the customer does not follow a standard checkout procedure. Instead, the cart is sent back, and the order is placed through the application to the buyer organization for financial approval; once it is verified, a purchase order is created and sent to the supplier to fulfill. 

The moment there is a PunchOut integration with the buyer's e-procurement application, a purchase would look like this: 

  • The prospective buyer (client’s employee) uses the e-procurement application and selects your supplier’s name as the vendor. 
  • The vendor website and its contents would be fully displayed to the user even though they haven't logged in or visited the actual website. The user can now browse and search for the products or goods and add them to the shopping cart; however, instead of checking out, they punch out. 
  • When the user finishes the product selection, a request is sent for approval within the user’s company's e-procurement application. The moment the approval is granted, the system sends the product list to the supplier's original site, and the normal procedure for online purchase begins. 
  • The PunchOut process is quite straightforward and helps the buyer’s organization search for and purchase products freely on numerous sites without leaving their e-procurement applications. 

What Format Are PunchOut Catalogs?

PunchOut catalogs work on the principle of open catalog interface (OCI), a standard format used by SAP Supplier Relationship Management, Microsoft Dynamics AX, and other purchasing systems that links to an external PunchOut online catalog.

What Is the PunchOut e-Procurement System?

Electronic procurement is a standardized way that large organizations and government agencies purchase many items for their daily needs. Although the process may seem similar to regular buying from shopping sites, there is a big difference—electronic procurement requires an e-procurement application to monitor management policies, vendor agreements, and other specifications.

An e-procurement system is a specialized application that business organizations use to conduct electronic transactions. It is a software tool through which employees of an organization or an agency purchase goods needed by that organization from a supplier.

Businesses ask their employees to conduct transactions only through their e-procurement system. The application can also be used to browse and look for products online from different suppliers. When the procurement officer sees an item that needs to be purchased, this user adds it to the cart and sends it to the buying organization for approval via the e-procurement system. Once approved, an order request is sent to the supplier. 

Organizations are establishing procedures for their purchasing employees to conduct transactions only through their e-procurement system. An e-procurement software application can also be used to browse and search online for items from various vendors. 

After approval from the finance department or a senior manager, the purchase order is sent to the supplier for fulfillment. Often, the approval process in organizations is built accordingly to order amount limits—small orders can be approved automatically, larger orders require approval from the purchasing manager, and especially large ones from the CFO. 

There are several kinds of vendor catalogs for e-procurement systems:

Hosted catalogs 

A hosted catalog is a list of products available for purchase and created by the vendor (usually in an excel format) to give vital information for searching for offered goods and services. Suppliers can easily create such kinds of catalogs, and buyers easily access them; this type of catalog is ideal for catalog lists that rarely change. However, it is unable to share information with the e-commerce website. 

CIF catalogs

The Common Interchange Format (CIF) is a worldwide standard for catalog descriptions. Thousands of procurement systems from many manufacturers around the world use it. CIF catalogs are divided into two categories: full-line and cross-tabular. 

  • Full-line catalogs are the most common type. They list all items in the catalog and their descriptions and prices. 
  • Crosstab catalogs only list items that have been updated since the last time the file was generated. They don't include descriptions or prices. 

Which type of CIF catalog you use will depend on your needs. Crosstab might be a better option if you need to update your catalog frequently. But a full line is probably better if you want to include more information about each item.

PunchOut catalog

PunchOut and CIF/Hosted catalogs both allow suppliers and organizations to display their products for sale through an e-procurement application. However, the approach toward fulfilling this goal differs.

A CIF (catalog interchange format) catalog is a static list that only provides information about goods displayed within the organization's procurement system; it is also referred to as a line-item catalog. The supplier must always compile the data for this type of catalog and upload it to the buyer's e-procurement system. Examples include SAP Ariba, Coupa, and JAGGAER.

A PunchOut catalog is a more dynamic tool that can integrate with a buyer's e-procurement system in real time and handles data automatically. The trend is that organizations use this format more frequently.

Schedule a talk with our ecommerce expert

Cif/Hosted vs. Punchout catalogs - understanding the difference

Punchout and CIF/Hosted catalogs both allow suppliers and organizations to display their products for sale through an e-procurement application. However, the approach toward fulfilling this goal differs.

A CIF (catalog interchange format) catalog is a static list that only provides information about goods displayed within the organization's procurement system; it is also referred to as a line-item catalog. The supplier must always compile the data for this type of catalog and upload it to the buyer's e-procurement system. Examples include SAP Ariba, Coupa, and JAGGAER.

A punchout catalog is a more dynamic tool that can integrate with a buyer's e-procurement system in real-time and handles data automatically. The trend is that organizations use this format more frequently.

Why Do You Need to Use a Punchout Catalog?

Most companies and institutions have strict purchasing policies, budgets to follow, regulations for adding new vendors to the pool of verified vendors, and many other rules. PunchOut apps help these organizations manage procurement activities and provide several benefits, such as: 

  • Reduced costs: A PunchOut system offers some opportunities to save money by reducing labor costs, mostly using automation. There are also discounts from vendors on their e-commerce sites. Working with a PunchOut system is a cost-effective process. 
  • Productivity: A PunchOut catalog provides a stable online connection between an organization's e-procurement application and the supplier's website. This means the buyer won't waste time searching vendor websites when they want to purchase items for the organization, and less time will be spent placing orders because the process is automated. 
  • Reduce errors and increase speed and accuracy: A PunchOut catalog helps reduce purchasing errors in the buying organization. It also makes purchasing fast because of working with a verified supplier. Procurement processes become easier to manage. 
  • Centralized docflow: Companies can better manage information and purchasing with a single PunchOut catalog because the customer must send the product through the e-procurement application for approval. Companies can set the appropriate internal docflow rules, automate them, and manage the process. 
  • Real-time updates: Product information and prices in PunchOut catalogs are always automatically updated on the supplier side so that information is available to customers in real time. 
  • Preventing Unauthorized Purchases: Unauthorized purchases are items purchased by employees that are not on the approved purchasing list. If items were purchased with company money and in the company's name, it could cause losses. Having a PunchOut system in place means that all transaction reports are sent back to the company through the e-procurement app so dark purchases can be checked and prevented. 
  • Verified Supplier Pool: It can be difficult to keep track of all the suppliers a company deals with and the products they supply. However, with the PunchOut system, a buyer can easily search for products from various sources without leaving the e-procurement application. 

Although Punch Out procurement methods may seem complex and troublesome initially, they are essential for efficiency in large companies and government agencies with rigid procurement rules and multi-step internal docflow. 

PunchOut Catalog Benefits

For several reasons, many B2B clients opt for the B2B punchout catalog, and product vendors have been asked to provide these catalogs.  Most suppliers don't understand the reason for this and might not be quick to adapt, but experienced suppliers know how important a catalog is and the benefits it gives their customers. Benefits of using a punchout catalog include:

Punchout is steadily becoming a must-have for supplier companies. This technology easily solves a complicated product search by allowing users to access vendors' product catalogs, increasing the chances of making a purchase. 

The vendor company gains more loyalty from the B2B customers, more sales, and faster deals with a punchout system.

cXml and OCI Document Languages for PunchOut

cXML (Commerce eXtensible Markup Language) is a standard document language that gives B2B users with procurement systems the ability to PunchOut to a vendor's e-commerce website.

OCI (Open Catalog Interface) is similar to XML; however, it uses field mapping to connect the buyer's procurement system and the supplier's e-commerce site. OCI document language is more configurable than CXML and is more versatile. 

PunchOut Catalog Examples

There are many other examples of PunchOut catalogs, each with unique features and benefits. Here are just a few PunchOut catalog examples: 

  • PunchOut2Go (currently rebranded as TradeCentric) is the leading provider of PunchOut catalog integration solutions. They offer a simple, turn-key solution that makes it easy for buyers to connect to any PunchOut catalog and a wide range of other ecommerce platforms. Learn more about PunchOut integration capabilities with Virto Commerce below. 
  • Amazon Business PunchOut: This PunchOut catalog gives buyers access to millions of products from Amazon Business, the B2B marketplace from Amazon.com. With Amazon Business PunchOut, buyers can enjoy the same convenient shopping experience they're used to from Amazon while also getting the added benefit of competitive pricing and discounts available only to businesses. 
  • SAP Ariba PunchOut: Ariba PunchOut is a popular PunchOut catalog that connects buyers to suppliers through the Ariba Network. With SAP PunchOut, you can provide an updated and personalized shopping experience for customers browsing SAP Ariba catalogs. B2B shoppers are redirected to the vendor's website, where the latest products, prices, and ordering options are displayed in real-time. 
  • Oracle iProcurement: PunchOut Catalogs allows Oracle iProcurement users to punch in and shop on vendor websites while completing the verification and approval process internally at the Oracle enterprise application suite.

Why Choose Virto Commerce?

Virto Commerce serves as a commerce integration platform that simplifies the integration of advancing B2B ecommerce abilities with other systems of business like PunchOut that ignite faster starts.

PunchOut integration allows businesses to connect their ecommerce store with their PunchOut system. This enables buyers to easily punch out and purchase items from the ecommerce store and suppliers to receive orders and invoices automatically.

Why is integrating punchout systems and ecommerce so vital? 

The advantage of PunchOut integration lies in the fact that it can save a company a lot of time and money. For example, if a business uses an ecommerce store to sell products but still has to handle orders and invoices manually, the process can be very time-consuming and expensive. By integrating the two systems, businesses can automate the process and save both time and money. 

Features and benefits of punchout catalog and ecommerce integrations

PunchOut integration offers many benefits for businesses, including: 

  • Reduced costs: Businesses can save on labor costs associated with manual processing by automating the process. 
  • Increased efficiency: Automated PunchOut can help businesses reduce errors, increase accuracy, and improve turnaround time for orders. 
  • Improved customer satisfaction: Businesses can improve customer satisfaction by making it easier for customers to punch out and purchase items. 
  • Increased sales: Businesses can increase sales by making it easier for customers to purchase items. To summarize, PunchOut integration is vital for businesses that want to save time and money, increase efficiency, and improve customer satisfaction.

How do you make a PunchOut catalog

Creating a PunchOut catalog with a provider usually requires a few steps: 

  1. First, you need to create an account with the PunchOut provider of your choice.   
  2. Once you have created an account, you will be able to create your PunchOut catalog.   
  3. To create your PunchOut catalog, you will need to provide basic information about your company, such as your company name, address, and contact information.   
  4. Once you have provided this information, you can choose the products you want to include in your PunchOut catalog.   
  5. After selecting the products you want to include in your PunchOut catalog, you will need to provide PunchOut instructions to your customers.   
  6. Once you have provided PunchOut instructions to your customers, they can access your PunchOut catalog from their ERP system and order the products they need. 

How do you integrate a punchout application with the Virto commerce platform?

To integrate a PunchOut application with the Virto Commerce Platform, we cooperate with TradeCentric. TradeCentric is the perfect partner for businesses looking to connect, automate, and scale their digital trading capabilities.

TradeCentric's unique position at the intersection of ecommerce and eProcurement makes it the perfect partner for businesses looking to connect, automate, and scale their digital trading capabilities.

In conclusion, Virto Commerce stands among the greatly developed product companies in the business space. You can check out the program and its enormous benefits and solutions, like the B2B marketplace platform, to get started and have a flawless operation. Your customers can rest assured that your site is secure and always updated. Companies can download and use Virto Commerce for a free trial. Virto Commerce is available for all companies to handle their online needs.

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