Welcome Onboard
Last updated
Last updated
Supply chains are just insanely hard.
This industry is mind-bogglingly complex - try syncing up the movement of stuff between harbors and end points, or folks shipping things and those moving them. It's a total nightmare, especially when you're dealing with massive scale. Tiny slip-ups can snowball into huge messes, and major screw-ups? They could tank the whole company.
But here's the thing: if you can wrestle that chaos into something smooth and efficient, you're looking at some seriously epic opportunities.
A significant portion of supply chain workflows remains manual, involving data entry, validation, and approval. This reliance on human intervention increases the risk of errors.
Understanding most supply chain contracts often requires a "PhD-level" analyst.
When a company like Nike needs to transport products from a manufacturing center to a distribution hub, they hire a carrier, such as a trucking company. This generates extensive data affecting the final cost, including:
Basic metrics: Freight rates, shipping weights, fuel surcharges, distance traveled.
Contract details: Discounts, delivery guarantees, insurance, gate fees.
Additional charges: Inside pickup, liftgate, wait time, protection from freezing, and inspection fees.
These charges come with various documents in different formats (PDFs, photos, EDI 210) and from multiple sources (mail, email, TMSs, ERPs). This complexity makes auditing challenging, especially when unexpected charges, like liftgate fees, need verification.
For large transportation and finance teams, managing and auditing multiple invoices from different carriers can be overwhelming.
Metro’s platform solves this by centralizing payment data for shippers and third-party logistics providers (3PLs). Using AI, Metro ingests, standardizes, and links shipment data across carriers, file types, and sources, turning raw data into a structured, manageable format and streamlining the entire process.
Metro’s industry-first system of record offers substantial value, but it goes beyond that with features that automate finance-related workflows. Metro enhances this system by automating supply chain audits, dispute resolution, scenario planning, data visualization, cost allocation, and payment processing.
Here’s how Metro delivers value:
Short-Term: Metro helps shippers cut unnecessary costs by automating audits to quickly identify and resolve errors, such as unexpected fees.
Long-Term: Metro optimizes supply chain budgets with advanced analytics, allowing shippers to forecast spending per carrier or product accurately for better planning and analysis.
Similar to fintechs like Ramp and Brex, Metro began by helping customers reduce expenses. Now, by centralizing finance and payment data, Metro is positioned to build additional products, aiming to be the leading platform at the intersection of supply chain and finance.
From first principles:
Market leaders are typically large companies operating in expansive, growing markets.
Many startups, despite having exceptional teams and demonstrating solid growth, fail to achieve significant scale due to limited market size. Their growth is constrained by the number of potential customers available.
Therefore, to establish Metro's potential for substantial growth, we must demonstrate two key points:
Metro operates in a large, expanding market.
Metro has the capability to become a dominant player in this market.
The next frontier in supply chain innovation is fintech and AI, offering solutions to these issues. Many problems arise from unstructured, varied data that’s hard to access and analyze. As with other vertical SaaS categories, specialized financial services follow initial SaaS adoption. Now is the time for AI-driven tools to streamline data analysis and transactions.
Shippers turn to Metro to optimize supply chain by:
Automating audits to eliminate extraneous fees and unnecessary spend.
Analyzing payments data for better planning and forecasting.
Providing network insights to help negotiate more favorable carrier contracts.
One indicator is the current market for supply chain audits, primarily served by consulting firms and point solutions. Estimates suggest it's substantial: $3.1 billion annually, growing at 6.8% per year, and projected to reach $4.8 billion by 2024.
Metro creates value by addressing key issues in supply chain operations:
Error Reduction: Supply chain payments are prone to errors. Former Maersk CEO noted that nearly 12% of container industry invoices are inaccurate, with some estimates reaching up to 25%. Errors range from billing address mistakes to complex issues like unplanned fees and miscalculated surcharges. Effective auditing could recover 2-5% of total logistics spend.
Analytics Enhancement: Advanced analytics are crucial but challenging due to poor data quality. Chief Supply Chain Officers (CSCOs) have identified these analytics as a top investment priority, with 79% developing training to boost adoption.
Data Foundations: Few supply chain organizations have robust data foundations. Metro’s data layer helps shippers prioritize carriers, identify expansion areas, and uncover network bottlenecks, leading to significant operational improvements.
Shippers face major challenges today:
Ensuring invoice accuracy and preventing overpayment.
Estimating spend on routes or carriers with variable charges.
Identifying inefficiencies in the transportation network.
For large shippers like Nike, managing invoices from over 36,000 carriers means handling thousands of diverse documents and formats. Without a centralized data repository, achieving accurate, real-time visibility into transportation finances is nearly impossible.
In the current system, invoices often take 30 to 90 days to be paid. Supply chain financing addresses this by allowing carriers to receive early payment in exchange for a small discount (typically 2-3%). Here’s how it works:
A financier pays the carrier 98% of their invoice upfront.
The shipper then pays the financier 99% of the invoice on the due date, allowing the financier to retain the 1% difference as profit.
This arrangement benefits all parties involved:
Carriers: Receiving early payment is crucial for their capital-intensive operations and growth.
Shippers: They can retain working capital longer and enjoy a 1% discount on their invoice.
Financiers: They earn a profit by providing early payment.
The supply chain finance market is rapidly growing: global volumes increased by 21% this year to $2.184 trillion, funds in use grew 20% to $858 billion, and revenue rose 23% to $97 billion. This growth is steady and not just a result of pandemic-induced freight demand surges.
Shippers across diverse industries—such as manufacturing, consumer goods, apparel, and financial services—frequently need to procure raw materials. These shippers receive invoices for these materials, similar to how they receive transportation invoices from carriers. Just as with carrier invoices, these procurement invoices must be audited and paid, often through a labor-intensive and outdated process.
Given that Metro is already streamlining supply chain audits for shippers, it is well-positioned to extend its capabilities to procurement invoices and workflows, offering similar efficiencies and improvements in this area.
Metro aims to become the central player where logistics and finance intersect, handling every financial flow throughout the supply chain.
