--- sourceDocument: Yokohama Finance and Supply Chain sourceDocumentLink: https://servicenow-prod.fluidtopics.net/r/yokohama/source-to-pay-operations Release : - yokohama ft:locale : - en-US ft:publication_title : - Yokohama Finance and Supply Chain ft:clusterId : - stpop bundleId : - stpop workflow : - Employee --- # Understanding punchout # Understanding punchout {#ariaid-title1} * Release version: Yokohama * * Updated July 31, 2025 * * ![](https://www.servicenow.com/docs/portal-asset/ico-clock) 1 minute to read Punchout is a technology that connects a buyer's eProcurement application directly to a supplier's eCommerce site, enabling the buyer to browse products, build a cart, and then have the cart redirected into the buyer's procurement system for checkout. Punchout enables an organization's employees to shop on a supplier's third-party eCommerce site. Purchases are completed in the organization's eProcurement application, where approval workflows and spending controls are applied. In a Level 1 punchout, shoppers can browse the supplier's catalog within Shopping Hub but with limited functionality, such as viewing products without real-time pricing or availability. When they select items, they are redirected to the supplier's punchout site to add products to their cart. The cart is then redirected back to Shopping Hub, where the shopper completes the checkout. With a Level 2 punchout, shoppers search for products within Shopping Hub. When they select items, they are redirected to the supplier's punchout site to view real-time product details and pricing. After finalizing selections, the cart is redirected back to Shopping Hub, where the shopper completes the checkout. * **[Punchout configuration in SPO](https://servicenow-prod.fluidtopics.net/RTSRLdn0r8ghDfWBwCMlQw)** You must configure punchout for third-party suppliers. * **[How L1 punchout works](https://servicenow-prod.fluidtopics.net/f4XKIHWcYZyqny04qrJtNw)** In the Level 1 (L1) punchout, SPO and the punchout supplier communicate using the cXML protocol. * **[Establishing connection between SPO and the supplier punchout system](https://servicenow-prod.fluidtopics.net/datAOHcWKAFiCyuLISTsHw)** SPO and the supplier punchout system use PunchoutRequest and PunchoutResponse payloads to establish the connection. * **[How L2 punchout works](https://servicenow-prod.fluidtopics.net/NYrjt4yASJqq_8JdrHFEpQ)** Level 2 (L2) Punchout enables buying organizations to search for and discover Punchout items directly within their procurement application, eliminating the need to search each supplier's site individually. **Related concepts** * [My purchases on Shopping Hub](https://servicenow-prod.fluidtopics.net/5t~ZNsWYNWZH_Tag5DDi5A "As a shopper, you can view all the purchases made from your shopping account by selecting My purchases from your Shopping Hub profile.") * [Shopping Hub Mobile](https://servicenow-prod.fluidtopics.net/uffEy6Bj5o7UMcKmNr4olQ "The ServiceNow Shopping Hub Mobile app enables you to engage with procurement organizations from a mobile device. Shopping Hub Mobile is available on the Now Mobile app and is supported on iOS and Android devices.") * [Performance Analytics for Sourcing and Procurement Operations](https://servicenow-prod.fluidtopics.net/RLsMjJAKrsOeG9O68m1CTA "With this application, you can use a set of pre-configured metrics and dashboards to assess spend, operational efficiency, and team performance across the Sourcing and Procurement Operations product.") * [Procurement Case Management](https://servicenow-prod.fluidtopics.net/XDrgia_5WzfU2ZJwmuo0NA "With the Procurement Case Management application, you can enable your employees to submit procurement cases and access your organization's knowledge base. You can also enable your procurement teams to automate their fulfillment processes so that they can manage and monitor the progress of their tasks.") * [Source-to-Pay Workspace](https://servicenow-prod.fluidtopics.net/iT1k4CmltMD0SgUETDW63Q "As a Procurement Specialist, you can easily complete your actionable tasks within the premises of an enhanced user experience with Source-to-Pay Workspace.") * [Spend and Savings Management](https://servicenow-prod.fluidtopics.net/QIfiJ_BvM55yR63TwlaRmQ "Category management is a strategic procurement approach that involves managing a group of related products or services to maximize value, optimize costs, and enhance supplier relationships. Essentially, it’s the structured management of category taxonomy, ensuring that goods and services are categorized, sourced, and managed efficiently to drive better decision-making and operational efficiency.") * [Sourcing Pipeline Management](https://servicenow-prod.fluidtopics.net/AO~BRG26uVqG3I73qFg15A "Sourcing Pipeline Management (sn_spend_pipeline) provides a centralized framework for creating, tracking, and executing sourcing initiatives through pipeline projects. It enhances efficiency through automated workflows, improves visibility into project progress, and simplifies savings tracking and forecasting.") * [AI Search for Sourcing and Procurement Operations](https://servicenow-prod.fluidtopics.net/1a37kuiY2AvtZU9QCbLCrQ "The AI Search application provides a modern consumer-grade search engine for the Service Portal, Employee Center (EC), Mobile, and Virtual Agent.") **Related reference** * [Sourcing and Purchasing Automation](https://servicenow-prod.fluidtopics.net/Mc~Py~dE0Ephniz~fyxBbA "Sourcing and Purchasing Automation for ShoppingHub includes workflows that help support the user interface purchasing experience for the shopper. These workflows consist of sourcing requests, negotiations, purchase requisitions, contracts, purchase orders, receipts, and invoices.")