SAN MATEO, Calif.--(BUSINESS WIRE)--Tipalti, the leading global payables automation solution, released findings that demonstrate which industries and countries have experienced the biggest shifts in average remittance per transaction (ART) during the COVID-19 pandemic.
Tipalti found that the ART as a whole across all transactions showed a decrease. From the pre-COVID-19 period of Q4 2019 to the post-COVID-19 period of March through May of 2020, the ART dropped 5.0%. It recovered slightly from the period of March through May 2020 as compared to June through August 2020, at 1.2%. From the Q4 2019 to June to August 2020, the total reduction in ART was 3.8%.
Regarding regional trends, Tipalti looked at ART data by continent and found that South America and Africa were the hardest hit. South America’s ART decreased by 40.72% when looking at Q4 2019 when compared to the June through August 2020 period, and Africa saw an ART decrease of 35.57% during the same time period. Many European countries took hard hits as well, with Finland, France, Spain, Denmark, and the UK amongst the worst performers.
In contrast, Asia and Oceania have actually increased their ART compared to Q4 2019. Asian countries have been able to maintain solid operations across Indonesia, China, and India. In addition, Norway and Sweden were amongst the fastest growing regions post-COVID-19 when compared to before the pandemic.
The Tipalti data also identified several noteworthy industry trends. Data on the Advertising and Marketing industry showed that compared to Q4 2019, from June through August 2020 there was a decrease of 8.8% ART. However, within the industry, it was Ad Networks that received the largest hit, with a decrease of 13.0% during the same time period. Influencer and affiliate marketing on the other hand actually gained 10.9% and 8.5% in ART, respectively, likely due to brands requiring more accountability and focusing onto increasing their conversion rates with more measurable campaigns. Advertising agencies also saw an ART increase of 33.2% during the same period.
Tipalti also looked at the Retail, E-commerce, and Marketplaces industry. Similar to the findings for the Advertising and Marketing industry, the data team discovered that while some sectors including general retail and e-commerce saw a 58.8% and 15.4% ART increase, others – such as the gig economy and online marketplaces – experienced decreases. The decline in online marketplaces, which decreased by 43.0%, may be due to consumers looking primarily to buy essentials rather than specialty items.
The Business and Finance Services industry also saw a mix of both positive and negative ART numbers depending on the sub-category. For example, both financial services and wholesale distribution saw positive changes in ART, at increases of 34.5% and 54.9%. However, sub-categories like consulting firms and translation fared much worse, with double-digit ART decreases for both.
“During a black swan event like the coronavirus pandemic, businesses need to consider the shifts in their supply chain strategies. This data broadly highlights how the pandemic has impacted business and supplier communities around the world,” said Chen Amit, CEO and Co-founder of Tipalti. “With the world bracing for what seems like a third wave of COVID-19 as we enter the winter months, we will continue to monitor our data to help share insights on how the pandemic is impacting the business community.”
Tipalti currently processes over $12 billion in payments annually for over 1,000 customers to 196 countries. This provides a compelling data set to examine the economic impact that the pandemic has had. Tipalti has unique visibility into ART, which allows the company to look at transactions at the molecular level to determine the health of a given industry or country. The assumption is that if transaction sizes to suppliers and partners decrease, it would indicate that people were paid less for goods and services.
About the study
Tipalti’s data team compared post-COVID-19 remittance (pay-out) activity in 2020 (March through August, 2020) with pre-COVID-19 (October through December, 2019) transaction behavior. For the post-COVID-19 period, Tipalti also broke out the data between the two waves (March through May and June through August). Tipalti gathered this data to better understand how COVID-19 impacted the business and supplier community.
Tipalti comes from the Hebrew expression for "We handled it." Tipalti does just this by providing one comprehensive, global payables automation solution that automates all manual supplier payment processes. Its customers typically wipe out 80% of their payables workload, enabling them to focus on mission-critical initiatives, while doing more with less. Tipalti helps strengthen compliance and financial controls, avoid future AP headcount requirements, accelerate the financial close by 25%, and employ AP best practices.
Every step in the payables process—including self-service supplier management, tax compliance, fraud and regulatory controls, invoice processing and approvals, global payments execution, and payment reconciliation—is fully self-contained and backed with integrated artificial intelligence and machine learning.
Tipalti's commitment to being customer-first has culminated in an industry-leading 98% customer retention rate with trusted brands including Amazon Twitch, Amplitude, Roku, Duolingo, Gitlab, Medium, ClassPass, Toast, Automattic, Twitter, Business Insider, GoDaddy, Zola, Boston Globe Media, Noom, Roblox, Headspace, Fiverr, Vimeo, Stack Overflow, ZipRecruiter, AppLovin, Canva, Indeed, and Foursquare.
Visit tipalti.com to learn more.