Jumia, Africa’s leading eCommerce platform, has announced its decision to cease operations in South Africa and Tunisia by the end of 2024. This strategic move comes after a comprehensive review led by CEO Francis Dufay, revealing that both markets contributed minimally to the company’s overall performance.
In 2023, Jumia’s South African subsidiary, Zando, and its operations in Tunisia accounted for just 3.5% and 2.7% of total orders, respectively. The gross merchandise value (GMV) from these regions has been consistently low, with a noticeable decline observed in the first half of 2024. This stagnation, coupled with increasing competition, prompted Jumia to reassess its market strategy and prioritize regions with greater growth potential.
Dufay acknowledged the difficult nature of this decision but emphasized the necessity of concentrating resources on markets where Jumia can achieve sustainable growth. The company plans to redirect its efforts towards core markets, including Nigeria, Kenya, Egypt, and Morocco, where the eCommerce landscape is significantly stronger.
This exit aligns with Jumia’s broader objective to streamline operations and work towards profitability. The company has faced challenging market conditions, influenced by economic pressures and fierce competition from both local and international players. In Q2 2024, Jumia reported a staggering 25% drop in revenue compared to the previous quarter, and its GMV also suffered a setback.
Despite these hurdles, Jumia remains optimistic about its prospects in Africa’s more promising markets. By concentrating on enhancing its marketplace, logistics network, and JumiaPay platform, the company is focused on a path to recovery and profitability.
