Global trade slumps ignite a new chapter in globalization

Many of the world’s largest buyers and their suppliers use Tradeshift’s trade technology network to exchange digitized purchasing and invoicing information. The data these transactions yield provides us with a unique awareness of trading activity between businesses.

Tradeshift’s Index of Global Trade Health analyzes anonymized world trade 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 world trade data provides a useful snapshot of 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, something which you will see us draw on throughout this report.

The Index of Global Trade Health compares business-to-business transaction volumes (orders processed from buyers and invoices processed from suppliers) submitted via the Tradeshift platform against a ‘baseline’ created by analyzing medium-term seasonal trends in the transaction data that flows across our platform.

A reading that meets the baseline indicates growth aligned with expectations against historical trends. Readings greater than and below the baseline indicate above-trend and below-trend growth.

Looking at the data this way helps give a sense of how volatile activity is across different sectors and geographies. For example, a sudden rise in orders might trigger orders to jump at a rate exceeding what we consider normal. By contrast, waning demand might trigger volatility in the opposite direction.

We consistently strive to improve and evolve the accuracy of our analysis. As a result, from time to time, you may see small revisions to historical numbers reported in previous versions of the Index.