Jumia, once regarded as Africa’s leading e-commerce platform, is shutting down its operations in both Tunisia and South Africa.
The company says the closure of these markets will allow it to focus resources on its most promising markets that have a stronger growth potential.
For the year ended December 31, 2023, and the six months ended June 30, 2024, the company notes that South Africa and Tunisia combined accounted for only 3.5% and 2.7% of total orders, and 4.5% and 3.0% of GMV, respectively.
This minimal contribution, coupled with challenging competitive and macroeconomic conditions, has prompted Jumia to reassess its presence in these regions.
It further says that the strategic decision to close operations in these markets is expected to improve overall operational efficiency across Jumia’s 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.’’ Jumia CEO, Francis Dufay said.
‘’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 adds.
Jumia said in a statement it believes that exiting these markets and refocusing resources on its other nine markets will leave the company better positioned to accelerate overall growth and further improve efficiency.
Jumia’s remaining operations now include key markets such as Egypt, Kenya, Morocco, and Nigeria, among others. In May this year, the company appointed Vinod Goel, as the Regional CEO of East Africa. Vinod previously served as the CEO for Uganda but will now manage Jumia operations in the country as well as Kenya as direct CEO.
The Company expects to cease operations in both South Africa and Tunisia by year-end 2024 marking the end of its presence in these two countries as it continues its restructuring efforts to strengthen its business across the continent.
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