Here at Science Warehouse, we know a thing or two about eCatalogues having been in the business for over 17 years now. Picking through the pros and cons of the different models it can be difficult to identify what really would be the best choice for you.
There are the in-house maintained ERP types, the PunchOut types (who sound quite dynamic?) and the specialist providers (clearly they sound good but are they really for me?).
In this blog, we talk through the pros and cons of each model.
In-house maintained ERP Catalogue
An ERP or a Finance based catalogue is normally the most common type of eCatalogue solution in place and it can be seen as a quick win and a cost effective solution as you may already have it as part of your current system. It ticks the box…. But there are several downsides to consider:
Time/Resources – The entire process of creating and maintaining the supplier catalogue falls to you. Even when you have a catalogue in place, price / product changes fall to your team to keep up to date and how do you assess the impact of those price changes?
Data Quality – Will your team really have time to create rich product data that users want and need to be able to find products, or compare products to make informed buying decisions?
Invoice Matching and Validation – If you are not able to keep products / pricing up to date you may be pushing the problem further downstream to the AP department for them to pick up the pieces at invoice match stage – adding costs to the whole process. The efficiencies from eInvoicing drop dramatically if most of your invoices don’t match!
User Adoption – The quality / richness of your catalogue will have an impact on user adoption if they are not able to be confident they are ordering the right product. In addition, most catalogue solutions included in Finance and ERP solutions don’t have a great user interface so training may be needed to help users locate what they want. All this has an impact on getting users to comply with the procurement process and increases maverick buying.
PunchOuts sound like a better solution than maintaining it all in-house but there are issues here as well.
There are some very good reasons for having PunchOut facilities so we are not dismissing they play a part. For example, where items are highly configurable (e.g. IT equipment) or where live stock updates are required. Where eCatalgoues just become a series of PunchOuts, then the “ease of use” suffers as users have to navigate different websites and the ability to compare across Suppliers becomes much more difficult so users tend to go for what they find first rather than looking across available Suppliers.
Level 2 PunchOut sounds good doesn’t it? Well it can help user adoption as a user can search multiple suppliers with a single search but the richness of the data supplied back can be an issue and depending on the integration type of Level 2 you may not see the price till you access initiate the price call (making comparing pricing between suppliers more tricky).
PunchOut is valuable in the right places but beware of the control you can be losing around user journey, pricing and richness of data.
An advanced catalogue solution will integrate seamlessly with your ERP / Finance solution and here the majority of the catalogues should be maintained by the suppliers themselves. That means that the responsibility of updates and data richness falls to the suppliers who want to provide good data as they want to sell their goods and services! This saves you time and money and allows you to focus on more strategic objectives.
Good catalogue solutions will have an excellent user interface that requires little or no training. It should be as simple to use as the systems we use in our everyday life and have many of the same features (Compare facility, advanced search, filters for example).
Moving to a specialist provider does not mean that you loose control of your catalogue. You should still be in control of price approvals from Suppliers and what products / services / prices your end users see.
Additional benefits then stem from having a specialist provider over and above the catalogue itself, spend analytics, electronic invoicing, service based / configurable product ordering.
Once the basics of a catalogue are in place you can start to leverage further savings from more strategic purchasing but you need a strong catalogue to understand what you are buying from whom…… what solution would you choose?
Science Warehouse has been supporting customers (and their Suppliers) through their Spend projects for the last 17 years and have a wealth of experience in this area. We have, for a long time, been expanding our procurement services away from our “Science” background and support organisations in delivering savings in a wide range of sectors including Education, Government, NHS, and Housing.
Contact us for a FREE catalogue assessment.Download our Buyer Handbook