Buyers Reach Out

Punch-out feature offers consistent shopping experience.

Despite the fact that many companies have scaled back on their IT plans, the business-to-business e-commerce concept of punch-out is slowly making inroads into enterprises.

Vendors including Oracle Corp. and Gateway Inc. are ready with new punch-out offerings that let IT managers give their e-procurement system users a consistent look and feel when navigating suppliers online catalogs.

Punch-out is a general term for technology that enables B2B shoppers to remain within an in-house procurement application while traveling to Web sites outside that to shop. Pioneered by the likes of Ariba Inc. and Commerce One Inc., punch-out is not a link to a Web site but is a protocol for interactive sessions managed across the Internet.

Oracle, based in Redwood Shores, Calif., late last month made available a new punch-out feature that allows corporate buyers to browse and buy materials from online suppliers without leaving the Oracle iProcurement application.

The Oracle punch-out feature directs search requests to supplier systems via a structured XML protocol, and matching results are returned directly to the users iProcurement screens. The XML protocol behind Oracles punch-out feature is available for free to all suppliers.

To avoid replication and publication of catalog content to remote systems, suppliers can store information centrally for availability to customers.

Before this new feature became available, iProcurement users were required to navigate through supplier Web sites to find products and then head back to the procurement application to complete the order.

Separately, Gateway, which is again trying to extend its consumer computer business into the enterprise, has created a proprietary process that extends its supplier catalog to an enterprises e-procurement site in a manner that provides continuously updated product, pricing and SKU information. That front-end information is integrated with the enterprises procurement systems.

Last week, Gateway, of Poway, Calif., announced it had created a punch-out Web site for the Pennsylvania Educational Purchasing Program for Microcomputers, or PEPPM. The punch-out capability allows schools and government institutions to punch out to Gateways site to procure Gateway products without leaving their procurement application—and still maintain competitive, prenegotiated contract terms.

In addition to PEPPM, Gateway is in the process of providing punch-out capabilities to about 20 other buyers e-procurement infrastructures.

"[Achieving this process] is expensive and complicated, with a lot of intricacies," said Ajit Sivadasan, director of B2B Web sales and marketing at Gateway. "[But] we are embracing it, so [our customers] can be more efficient, and ultimately we will be more efficient if they can punch out to our sites."

With 128 suppliers and 243 product lines, PEPPM found it would be impractical to integrate with each supplier.

The Gateway service has been the organizations breakthrough integration. Now PEPPM members—schools in Pennsylvania, California, Colorado and Minnesota—have the ability to go into an aggregated buying site that PEPPM participates in and complete purchases online.

"We have some other arrangements with companies where our users can jump out and use their [software to configure purchases], but there is no pass-back of information. There is just the opportunity to get pricing, then they do the order via paper," said James Randecker, procurement technology and services administrator at PEPPM, in Lewisburg, Pa. "It creates the best dynamic pricing environment that is available in the U.S. [for Grades K to 12]."

Punch-out, however, is not issue-free, according to Gateway.

"The rate of adoption is one of the problems we have seen," said Gateways Sivadasan. "Two years ago, I thought adoptions would be much faster, but these initiatives have had a lot of change management issues. Customers keep old systems alive."