B2B eProcurement is Picking Up Speed

Keeping up with industry trends can be cumbersome, and one that is gaining traction is the adoption of eProcurement. Business-to-business (B2B) eProcurement (also known as “Punchouts”) integrates a business’s purchasing software with their vendor’s ecommerce website. This integration allows any business or organization to use its existing purchasing processes and technology for a seamless shopping and ordering experience, and complete the transaction within their accounting systems

How does it work? When done right, a business can add convenient vendor icons on their purchasing department’s desktops that direct them instantly to their supplier's ecommerce site. After ordering, customer purchase orders are automatically sent to their designated internal department for approval, mitigating any confusing back-and-forth conversations between parties.

eProcurement Punchouts are integrated into the vendor’s ERP system. Ensuring a business gets the full benefits of its ERP is important for return on investment (ROI), and keeping up with the latest technology will help businesses continue to rise in an oversaturated marketplace. By embracing eProcurement, vendors can streamline processes, grow existing accounts, and motivate others to work with them.

We recently talked with our internal industry experts to explore some of the challenges that business product resellers face and how an eProcurement punchout can help them overcome the hurdles.

Challenge: Not Understanding the True ROI

“Having a punchout was mandatory to even be able to submit an RFP. If we hadn’t had one, we would have been ruled out immediately… eProcurement Punchouts allow smaller independent dealers to compete and win,” explains Juliette Trahan, operations manager at Union Office. By having a punchout that was fully integrated with their ERP, Union Office was able to win a contract as a preferred vendor for a top university in Cambridge, Massachusetts, and its affiliated laboratories.

When competing for accounts in industries such as healthcare, education, and government sectors, punchouts are often required. Without it, these organizations will often bypass a vendor. Having eProcurement punchouts shows accounts that a vendor can handle their business requests and will open the door to many possibilities they may have been too timid to approach initially.

An eProcurement system that highlights vendors as desktop icons also helps companies retain loyal customers.

“One of the biggest benefits for us is having our logo on their computer screens. It leads to a higher level of commitment from customers. You are more closely tied to the end users because they see you on the screen. It is easier for them to order because it helps them streamline the process, and they know you are a preferred vendor.”

Beth Freeman, executive vice president at FSIoffice,

Solution:

Businesses may be thinking: “this sounds great, but integrations are always a hassle and take up more time and resources than I’m willing to give up.” Maybe a vendor is worried that an eProcurement solution won’t integrate with their customers purchasing system. Take it from Freeman at FSIoffice, who explains: “the process is smooth with one- to two-week turnaround time. To date, we have not found a platform we were unable to integrate with.” Reaching out to an ERP representative and asking experts to help guide your business through the process. Often, these teams will have tactical training for a vendor’s ERP and eProcurement processes.

Challenge: Depending Too Much on Traditional Procurement Methods

eProcurement is a growing technology that many businesses are beginning to invest more in. Amazon Business’s 2022 State of Business Procurement Report found that 91% of B2B buyers prefer online shopping to traditional methods. In their 2021 B2B Evolution in eCommerce Report, we see that 85% of business buyers have pushed more of their procurement process online due to COVID-19, indicating that increased reliance on eProcurement will not be temporary and instead will become a core part of the procurement process well into the future. Customers of vendors are less willing to spend hours on the phone with their vendors discussing their purchases. The customers want a smooth, streamlined ordering process with as little resistance as possible. If vendors are unwilling to adopt agile processes, they may lose customers to more progressive competitors.

Solution:

“It takes out the paperwork and turns what in the past took five to 10 steps into a two-step ordering process,” Beth Freeman says about how eProcurement has helped make ordering less complicated. Simplifying processes for vendors and customers will give both a better experience that will keep customers coming back. Since many companies are moving to eProcurement, businesses do not want to be known as old-school and complicated to work with.

Challenge: Stagnant Growth

When trying to attract new customers, it is important to convey that a vendor is credible and can handle customers' business. Word-of-mouth can be one of the most powerful marketing techniques, so building a repour with happy clients will only inspire others to use a company as their vendor. In today’s world, everyone wants quick responses and even faster results, but manual procurement steps and back-and-forth communication can put businesses at a disadvantage. Additionally, existing procurement processes may restrict a business’s ability to explore other markets that could open great opportunities for growth and profit.

Solution:

By implementing an integrated eProcurement system, vendors can now compete for higher-end government accounts that, simply put, make them look good. Don’t be reactive when telling customers about the new eProcurement process; use this technology as a selling point. The business's sales team can be armed with the promise of streamlined ordering through eProcurement. Clients are more willing to accept vendors when they understand their level of capability; in this case, bragging is acceptable and encouraged. eProcurement sets businesses up to handle any customers they want to attract.

Punchouts do not only have to be a perk for customers; they can help grow a business through credibility, streamlined processes, and proven prior success experiences.

To keep up with industry trends like supply chain demands and inflation, and changing workplace dynamics, check our blog and learn more.