The UK is experiencing a significant and drastic fall in the volume of business-to-business transactions, according to the CEO of one of the world’s largest B2B payments and supply chain logistics platforms.
In an exclusive interview with TechCrunch at the World Economic Forum in Davos Switzerland, Tradeshift CEO and co-founder Christian Lanng said: “We see the numbers. There has been a huge drop in the purchase orders in the UK in December last year. Especially in retail. But it’s cross-sector. It’s manufacturing, retail, logistics.”
Tradeshift is a cloud platform for supply chain payments, marketplaces and apps which is one of Europe’s tech unicorns and has raised over $432M to date.
He said Tradeshift works with a “major manufacturer” in the UK which has “one hour of inventory” feeding its production line. He declined to name the firm.
Speaking about the effects of Brexit on supply chains, he said: “If you add 10 minutes of custom checks to every truck feeding that production line you create a traffic jam that cannot be resolved. It would last a week before it would get sorted out. They literally cannot operate the factory,” he said.
“Forget about the politics. This is just a very technical thing that’s going to happen. People don’t understand the facts. You can discuss it in a very abstract level but literally, it’s just like that.”
“People forget about the practices or realities of the supply chains across the channel and nobody is engaging really in any serious way with the people who know how that stuff works, because [Brexit] is like a circus, right?”
Speaking about Tradeshift’s recent acquisition of Bableway, a cloud integration technology platform, Lanng said the combined companies will process “more than trillion dollars of payments.” “That’s twice as large as PayPal and three times as large as Amazon in just payment volumes,” he said. “Between us we’ll have a bigger chunk of the world economy in terms of B2B, not B2C.”
Does Laang think there will be a global slowdown, as some are predicting?
“Our view is pretty simple. China freaked everybody out about how fast they moved with technology such as on health care, renewable energy, electric cars, AI, and financial services. And they’re now starting to push “Made in China” by 2025.”
“So [the West] is losing the global leadership. We have been slow to adapt to electric, or renewable energy. It was described as a hippie thing, but now it’s the future of the world. Countries using tariffs [to slow down China] it’s not going to work. We’re very bullish on Asia and any country in the world that’s ‘leaning in’ to technology.”