At the end of Q1, a bleak picture was painted for the near future of world trade. Unfortunately, these predictions proved to be accurate as global transaction volumes fell for the second quarter in a row, not to mention invoice traffic took its steepest drop in over a year.
In the face of skyrocketing energy prices, supply chain bottlenecks, and labour shortages, it’s hard to argue that supply chains have seen an outlook this rocky in recent memory. And while some of the current challenges facing supply chains are transitory, we’d be remiss to ignore the structural changes in the world economy that could mean inflation remains a recurring problem. However, all is not lost, as experts predict a focus on sustainable trade and supply chain resilience could be the path to redemption.
Business leaders in every sector are now acknowledging what we have been saying for all these years. Amid the gloomy short-term forecast, supply chain resilience, access to finance, and a focus on sustainable trade are seen as the fastest route to a brighter future.
Many of the world’s largest buyers and suppliers use Tradeshift’s trade technology network to exchange digitized purchasing and invoicing information. The data these transactions yield provides a unique awareness of trading activity between businesses.
Tradeshift’s Index of Global Trade Health analyzes anonymized data flowing across our platform to reveal a timely perspective of how external events impact business-to-business commerce worldwide.
We acknowledge that there are limits to how accurately our view of what is happening on our network can reflect how complex global supply chains are reacting to a variety of external factors. Our data provides a useful snapshot that provides clues as to what might be happening to the global economy. The patterns we see in our data become more valuable as we combine them with other third-party data and expert insight, which you will see us draw on throughout this report.
The new model compares business-to-business transaction volumes (orders from buyers and invoices from suppliers) submitted via the Tradeshift platform since Q1 2020 against a ‘baseline’ we have created by analysing medium-term seasonal trends in the transaction data that flows across our platform.
A reading of 100 indicates growth in line with expectations against historical trends. Readings greater than and below 100 indicate above-trend and below-trend growth.
We consistently strive to improve and evolve the accuracy of our analysis. As a result, it is possible that from time to time, you may see small revisions to historical numbers reported in previous versions of the Index.Download the full report
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