This week, we bring you the first in a 3 part series of live episodes recorded at Procurement Summit in Berlin on 29 and 30 September 2021.
We’ll be covering a different theme on each episode, and featuring 3 procuretech startups each week. Our focus is on some of the newer, less well-known startups who pitched and exhibited during the summit to bring awareness to some of the exciting new players out there who are destined to grow quickly.
Hot Digital Procurement and Supply Chain Startups in the ESG and Risk Management Space
On this episode, we’re looking at startups whose mission is solving problems in the rapidly growing and increasingly important ESG and Risk Management area.
Tobias Bohnhoff, Founder of Shipzero is my first guest.
Shipzero tracks and manages transport emissions, helping freight buyers and logistics managers to have more transparency around their shipping data.
The tool essentially enables companies to make strategic decisions around two key areas of transportation procurement and logistics management:
- Helping companies to reduce their overall transport footprint through optimisation of their freight operations.
- Evaluating different case scenarios when it comes to deciding which mode of transport to use.
One part of this conundrum is actually looking at where to source goods from. The increasing cost, especially of ocean freight, is making companies reconsider lengthy supply chains where historically the logistics cost was not a major factor.
Technology is now in place to enable data sharing between companies. The transportation market is very fragmented and contains a lot of smaller businesses who are not as technologically advanced as global logistics firms. Shipzero enables this data to be aggregated for the end customer.
When it comes to decarbonisation, there are also the factors of considering transportation methods powered partly or wholly by renewable energy.
Shipzero enables companies to simulate the CO2 emissions based on different transportation scenarios.
The range and payload for electric trucks is different to diesel trucks. Using a granular data stream from the telematics of the truck allows you to make the decision of which methods or lanes for transport can be switched to transportation from renewable energy sources.
Tobias mentions that any company with over €/$100 million annual turnover with significant transportation spend can benefit and see a positive payback of using the tool to optimise their transportation.
I ask Tobias how he would convince a company who doesn’t see this as a priority, to take action now rather than in a few years time. Then we round off the interview by looking at Shipzero’s plans for future growth.
Next up is Harald Nitschinger, CEO of risk management solution Prewave.
Harald comes off the back of winning DPW’s Startup Pitch competition during their virtual conference just a few weeks ago in September. So, what’s so special about Prewave?!
Well, it’s certainly a hot topic with COVID-19, broken supply chains, the new “Lieferkettengesetz” (Supply Chain Law) coming into effect in Germany making it a topic and a solution very much in focus right now.
Supply chains have never been less transparent and have never been more complex, with large organisations having tens of thousands of suppliers all over the world. Keeping on top of all of these transactions, past, present and future, is almost impossible without the help of technology.
Potential scandals, force majeure events, natural disasters
We take the hypothetical example of a child labour scandal for a textiles retailer using a supplier in Bangladesh: how could Prewave help to identify this before the story breaks and causes brand damage to the retailer.
Harald explains the concept of “known locally, unknown globally”, where social media and more traditional news outlets in the local language can often assist in gaining insights much faster than would otherwise be possible.
Having this foresight enables the end customer to take pre-emptive action before it becomes a bigger reputational issue in the international news.
B2C manufacturing business are the obvious target customers of Prewave, but as Harald explains, there are also other industry sectors, such as logistics and some of the wider service industries, who can also benefit from this analysis.
Managing first tier suppliers is great, but how do you tackle the wider issue of the multi-tiered supply chain? Harald gives a brief example of how Prewave has helped VW Group to do this with rare earth metals.
Prewave’s pricing model is based on the number of suppliers you want to monitor, rather than a licence-based or per enterprise pricing structure. This also means that the technology is affordable to mid-sized businesses who just have a small number of critical suppliers that they want to track.
Our final interview on this episode is with procuretech veteran Prof. Christian Heinrich and his company Carbmee.
Carbmee is one of the youngest companies pitching at Procurement Summit and focuses on offsetting carbon emissions.
If a business is aiming for achieve net zero in CO2 emissions, then you have two options: pay for carbon credits OR reduce your carbon emissions. This comes in 3 different scopes.
Scope 1 and scope 2 relate to the production and manufacturing process of a business. Energy savings being a classic example of this. The problem for most firms though lies within scope 3, which, as Christian explains, refers to the supply chain.
This is where 80% of a company’s typical carbon emissions can be found, and is also where Procurement and Supply Chain would become involved to assist in reducing emissions from suppliers or transportation providers.
Where would you start? By doing a classic pareto analysis to identify which of your suppliers are the biggest threats.
Carbmee is all about bringing the collaboration with suppliers into one, digital space rather than relying on emails and Excel sheets to try to keep track of this. The software has three key features:
- Facilitating Supply Chain Transparency
- Identifying where the CO2 hotspots are in a supply chain
- Tracking down and measuring the reduction of the emissions
The end result (and business case) is achieving net zero faster, and thus saving money through not having to pay for carbon offset credits.
Without using software, the reliance is on emails and spreadsheets, and likely also a costly external consulting project to resource and report on this properly.
Instead, it allows Procurement and Supply Chain to lead, own and manage this in-house and gets companies to where they need to go faster. The process automation and data automation, as well as the dashboards to track the progress and success, mean that it’s easy to report out at any time.
The industry sectors where Christian sees the biggest opportunity to make an impact with Carbmee are automotive, machine building, pharmaceuticals, chemicals, shipping and logistics.