SAN FRANCISCO, Ca.–Tradeshift launched two new joint ventures in China to connect millions of trading partners, digitalize the transactions between them, and offer accessible trade-based financial services to SMBs in the region.
The joint ventures aim to help strengthen the competitiveness of Chinese SMEs across global supply chains and support the country’s goal of raising cross-border trade to $2.5 trillion within a decade. Tradeshift and the joint ventures offer a framework for digital connectivity and collaboration between China-based enterprises and businesses worldwide to help the country achieve its technology modernization goals.
Tradeshift entered a joint venture with Shenzhen XunLian Technology Development Co.,Ltd. located in Chongqing, one of China’s four directly-controlled municipalities. It will primarily provide supply chain financing to millions of businesses and will process more than $30B of gross merchandise value (GMV) worth of transactions per year for some of the largest state- and private-owned enterprises in China.
The XunLian Tradeshift joint venture – Tradeshift Supply Chain Technology Ltd., – has developed several new customers, including Zongshen and Automobile Motorcycle Exchange, both headquartered in Chongqing.
Chongqing is currently the main hub for the Chinese government’s $140B “One Belt, One Road” initiative where Tradeshift will play a central role by providing suppliers with electronic infrastructure for trading and related financial services.
“Tradeshift Supply Chain Technology Ltd. established in Chongqing City, China, is a shining example of the infrastructure projects that we’re continually investing in to provide strategic support for our municipality and overall country goals,” said Zhang Rui, CEO of the new joint venture. “Through the help of modern tools necessary for supply chain management effectiveness, we aim to improve trade and relations with all our partners, especially those in Asia, Central Asia and European countries.”
Baiwang Tradeshift Joint Venture
The company’s strategic partnership with Baiwang, a provider of tax-related services, has paved the way for a joint venture named Baiwang Tradeshift. This year, the Chinese government replaced provincial Business Taxes (BT) with VAT for all service-based industries. This joint venture is with one of two companies in China that are authorized by the government to implement and market e-invoicing solutions for VAT compliance.
The 85-person joint venture serves more than 100 customers, including some of the largest companies in the insurance, banking and hospitality industries. Baiwang Tradeshift has processed more than 20 million invoices over the last three months, and that rate is poised to accelerate.
“We’re delighted that our investment in China has gained significant traction in 2016 and that we’ve been able to create a second joint venture with one of the most innovative supply chain financing companies in China to offer digital reverse factoring or supply chain financing apps,” said Mikkel Hippe Brun, Tradeshift SVP of Asia-Pacific and Co-founder. “Our platform vision puts both buyers and their suppliers at the center of our value proposition, which is proving to be a natural fit in China’s trade ecosystem as it is everywhere else.”
In late October, Tradeshift announced that it expanded into Australia and New Zealand to further meet the global demand for its cloud software designed for business networks.