The latest index of global trade health by US-based Tradeshift, which deals with e-invoicing, accounts payable automation and business-to-business marketplaces, shows that cumulative transaction volume growth across the Tradeshift platform stayed flat in the fourth quarter (Q4) of 2021 compared to pre-pandemic forecasts. Recent history suggests that things could have been a lot worse.

Fears that the significant drop in order volumes the company saw in Q3 could be the beginning of more profound and protracted slowdown in activity also proved unfounded, the company said in a press release.

Instead, ordering activity appears to be returning to a more predictable pattern. With recent data also suggesting that the supply chain bottlenecks of the past year are beginning to ease, a gradual calming of the waters heading into 2022 is foreseen.

The latest index of global trade health by US-based Tradeshift, which deals with e-invoicing, accounts payable automation and B2B marketplaces, shows that cumulative transaction volume growth across the Tradeshift platform stayed flat in 2021 fourth quarter compared to pre-pandemic forecasts. Recent history suggests that things could have been a lot worse.

Cumulative growth in transaction volumes remained flat against pre-pandemic forecasts despite early predictions that the omicron variant could trigger a steep fall in activity.

Order volumes appeared to stabilise in the fourth quarter (Q4) after wild fluctuations over the previous two quarters. Invoice volumes however remained flat, suggesting suppliers are still struggling to clear a backlog of orders from earlier in the year.

US supply chain activity finished the year with an overall Index score of 97, just 3 points below the level Tradeshift had forecast for the period prior to the pandemic.

In China, tough COVID prevention measures, together with weakening demand triggered a 10-point fall in transaction volumes against the forecast range. Q4’s index score of 86 puts cumulative growth in Chinese supply chain activity at its lowest level since the beginning of the pandemic

The recovery in supply chain activity across the eurozone stalled in Q4, dropping by 8 points compared to the expected range. A 20-point quarter-on-quarter fall in invoice volumes indicates fulfilment issues remain a key concern across the region, though the overall picture is less volatile than in recent quarters.

Activity across UK supply chains fell by 9 points in Q4. Demand appears high, with order volume growth remaining comfortably above the expected range, but a steep drop in invoice volumes during the quarter suggests ongoing pressures within the supplier base.

Activity across the worldwide transport and logistics sector climbed above the expected range for the first time in six months during Q4. The acceleration supports claims that supply chain bottlenecks are beginning to ease.

Transactions volumes in the manufacturing sector dropped sharply in Q4, finishing the year well below the expected range. Some commentators attribute the slowdown to a reluctance from customers to place orders before inventories were worked through.

Fibre2Fashion News Desk (DS)