Why are most online timber trading platforms not successful?

VonWood, a Dutch timber startup founded in 2022, filed for bankruptcy recently. The company aimed to simplify the wood trading process and cut costs by removing middlemen. However, one of the co-founders pointed out that the timber industry’s resistance to digital transformation was a major challenge.

The timber industry is generally conservative, and many people in it are not eager to adopt digital tools. This is partly because many grew up in a time before computers and smartphones. At APP Timber, we have an advanced online order platform called APPiC, where customers can track orders and access up-to-date shipping information and documents. It took years to get customers to use this platform, and even today, some still ask us to “fax” documents.

Fordaq and Timber Exchange were likely the first major online timber platforms, both launching in the late 90s. Fordaq was a B2B platform connecting buyers and sellers, and it was successful for many years. However, it became less relevant after being flooded with Chinese traders. I’m not sure what happened to Timber Exchange.

As for VonWood, I think the founders didn’t fully understand how the industry works. While it’s good to try to simplify the process, cutting out middlemen is not the main issue. Buyers mostly want reliable, high-quality products delivered on time, at fair prices, and with proper sustainability compliance. Suppliers prefer working with traders who understand the market, ensure timely payments, and handle any issues, so they can focus on production.