Jumia, previously recognized as the foremost e-commerce platform in Africa, is ceasing its operations in Tunisia and South Africa.
The company has stated that this decision will enable it to concentrate its resources on markets with greater growth potential.
For the fiscal year ending December 31, 2023, and the six-month period concluding June 30, 2024, Jumia reported that the combined contributions from South Africa and Tunisia represented merely 3.5% and 2.7% of total orders, as well as 4.5% and 3.0% of gross merchandise volume (GMV), respectively.
This limited impact, along with challenging competitive and macroeconomic factors, has led Jumia to reevaluate its operations in these areas.
According to Jumia CEO Francis Dufay, the company anticipates that this strategic move will enhance overall operational efficiency throughout its business.
“Since assuming the role of CEO, I have focused on initiatives aimed at strengthening our business and placing us on a path to profitability. After a thorough analysis, we made the difficult decision to close down our operations in South Africa and Tunisia.
‘’Both businesses account for a negligible portion of our overall operations. Furthermore, competitive and macroeconomic conditions in both markets have limited each country’s growth potential and their contribution to our overall business has not aligned with expectations,’’ he said.
Jumia has announced that it intends to exit certain markets and concentrate its resources on nine remaining markets, a strategy it believes will enhance its capacity for overall growth and improve operational efficiency.
The company’s ongoing operations will focus on significant markets, including Egypt, Kenya, Morocco, and Nigeria, among others.
In May of this year, Jumia appointed Vinod Goel as the Regional CEO for East Africa.
Previously the CEO of Uganda, Vinod will now oversee Jumia’s operations in both Uganda and Kenya.
The company plans to discontinue its operations in South Africa and Tunisia by the end of 2024, concluding its presence in these two nations as part of its restructuring initiatives aimed at reinforcing its business across the continent.