Tradeshift found that B2B trade activity across the United States supply chains have accelerated past China in Q2, growing 2.4% quarter-on-quarter.
According to the data, transaction volumes across Chinese supply chains had been growing steadily through 2020 but saw significant slowdown since the beginning of 2021, dropping 22% in just the second quarter.
“The recent slowdown in China shows how quickly external factors can start to impact momentum,” says Christian Lanng, CEO, Tradeshift. “Supply chain operators are walking a tightrope in order to keep recovery on track. Large buyers are understandably keen to capitalise on the current spike in demand, but if suppliers are left to pick up the check then the whole system will start to cave in to pressure.”
- Chinese factory outputs have been affected by supply chain bottlenecks. Tradeshift’s data suggests supply chains in the US and the Eurozone could also start to encounter challenges as suppliers struggle to keep up with demand.
- Total order volumes rose 35% in Q2 compared to the previous quarter. By contrast, the number of supplier invoices processed during the same period grew by just 2%, well below the rate seen in previous quarters. The more this gap widens, the more challenging it becomes for suppliers to build up sufficient cash reserves to fulfil new orders.
- Tradeshift’s data suggests that this imbalance is particularly acute across supply chains in the Eurozone where order volumes rose 62% in Q2 while the total number of invoices rose just 8% during the same period.