Do you ever wish procurement for your business could be as easy as online shopping? Just find the product you want, add it to your cart, and suddenly it’s on its way.
With punchout procurement, it can be.
Punchout catalogs simplify the process of business to business (B2B) procurement, making it as easy as adding to cart.
This blog post will explain what punchout is, how it can benefit your business, and how to get started.
What is punchout?
Punchout procurement connects a supplier’s catalog directly to an enterprise resource planning (ERP) platform like NetSuite or an e-procurement system. This allows businesses to place purchase orders directly from their existing platform.
This direct connection significantly simplifies the procurement process, eliminating the steps of logging into a separate portal to access the catalog, finding supplies, then replicating the purchase order in your ERP.
Most major suppliers offer punchout catalogs for ERPs and other platforms, making punchout procurement readily available for every industry (more on this below).
How punchout procurement works
Punchout provides a direct electronic connection between your ERP and your supplier using cXML (a protocol format used to exchange data between systems). Once you integrate your supplier’s punchout catalog into your system, purchasing supplies takes a few simple steps:
- Access the supplier’s punchout catalog from your ERP or e-procurement system. If you have multiple suppliers connected, they’ll typically show up as tiles in the system.
- Shop directly from the catalog, which is customized with negotiated rates and the exact products your company buys. Select your supplies and quantities and add them to cart (just like you would when shopping on a site like Amazon).
- Select “transfer cart” (or a similar option, depending on the platform) to automatically transmit your order to your ERP and generate a purchase order.
- The purchase order goes through the approval process.
- Once approved, your purchase order is sent directly to the supplier for fulfillment.
This simplified process saves businesses a lot of time by eliminating manual purchase order creation, delayed approval processes, emailing back and forth with accounts payable, and slow fulfillment times.
Benefits of punchout procurement
As you may have gleaned from the step-by-step process above, punchout procurement has a lot of benefits for businesses, including:
- Cost efficiency: Punchout catalogs can lead to reduced procurement costs through faster transactions (which means less work for your team) and negotiated pricing unique to your business.
- Automation: Automatic order transmission and purchase order creation eliminate manual processes — like data entry and reconciliation — that take time and are prone to manual errors.
- Accuracy: By reducing the risk of data entry mistakes when creating purchase orders manually, you get more accurate financials and improved visibility into your company’s procurement.
- User experience: The efficient procurement process, improved accuracy, and time savings lead to improved satisfaction for procurement teams and accounts payable teams alike.
- Compliance: Customized punchout catalogs built for your business help enforce company purchasing policies and budget limits.
Industries that can benefit from punchout procurement
Every business needs to purchase supplies, whether it’s office supplies or specialized materials and equipment. This means every business can benefit from punchout, regardless of the industry.
Here are some examples of the industries that tend to get the most out of punchout procurement:
- Biopharma and life sciences: This is one of the industries with the most specialized equipment and materials. Punchout procurement ensures precision and compliance in procuring laboratory equipment, reagents, and research and development materials.
- Manufacturing: With the constant stream of supplies this industry requires, punchout streamlines the procurement of raw materials, parts, and maintenance supplies.
- Healthcare: Another industry with highly specific procurement needs, punchout ensures fast, accurate, compliant purchasing of medical supplies and equipment in healthcare.
- Education: Punchout simplifies the procurement of supplies and services for universities, schools, and research departments.
- Retail: With the constant need to restock in this industry, punchout facilitates bulk purchasing and vendor management for retail chains and franchises.
- Government and public sector: Procurement in the public sector requires transparency, compliance, and precise budgeting, all of which punchout provides.
- Energy and utilities: Punchout streamlines the procurement of all the specialized equipment and maintenance services required in the energy and utilities space.
- Financial services: Financial institutions often have multiple offices with varied needs, and punchout centralizes the procurement of office supplies, software licenses, and services.
- Construction: In an industry that relies on diverse suppliers and materials for complex, multi-phase projects, punchout centralizes supplier management and creates a streamlined procurement process.
Integrating punchout procurement with your existing platform
Now that you have a better understanding of what punchout can do for your business, let’s explore how you can get started.
One of the key strengths of punchout procurement is its ability to seamlessly connect supplier catalogs with your existing systems, like an e-procurement platform or ERP. This gives you access to the catalog with real-time pricing and inventory updates while feeling like a natural extension of your existing workflows.
The first step to integrating punchout catalogs is understanding the capabilities of your platform and how you can work with integration partners to add suppliers to your system. For example, Netgain PunchOut connects catalogs directly into NetSuite, taking care of the entire technical side of the implementation.
The next step is to work with your suppliers to ensure they can support punchout catalog integration and are familiar with your procurement platform. Working with an integration partner like Netgain PunchOut simplifies this process.
Lastly, establishing an agreement with suppliers on data formats, protocols, and pricing structures is critical. Punchout catalogs are dynamic, meaning you’ll have real-time updates for product availability and pricing, which need to be accurately reflected in your system.
Enjoy better procurement with Netgain PunchOut
Ready to discover how punchout can transform your procurement processes?
Netgain PunchOut allows you to access your business’ negotiated and curated supplier catalogs directly from your NetSuite dashboard. With PunchOut, you can easily add your supplies to cart, then submit them for approval and purchase order creation, all within NetSuite.
Because it’s built directly in NetSuite, Netgain PunchOut matches your purchases with your NetSuite license, giving you full traceability for reporting. Plus, you can continue to use NetSuite as your accounts payable system, so you don’t have to replace existing approval processes.
To explore how Netgain PunchOut can simplify your procurement process, request a personalized demo today.
