Jumia is set to exit operations in South Africa and Tunisia to focus its resources primarily on its most promising markets.
The e-commerce company noted that South Africa and Tunisia only accounted for 3.5 percent and 2.7 percent of total orders and 4.5 percent and 3.0 percent of gross merchandise volume, respectively, for the year ended December 31, 2023. It noted that the decision to stop operating in these markets will improve its overall operational efficiency in other markets.
Francis Dufay, Jumia’s chief executive officer, said, “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.
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“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.”
The decision to exit these markets will reduce Jumia’s total number of operating countries from 11 to 9, with most of its focus now concentrated in West and East Africa.
“Jumia 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,” it added. The company expects to cease operations in South Africa and Tunisia by year-end of 2024.
The e-commerce company has recently struggled with currency depreciation in key markets like Nigeria and Egypt. In Q2 2024, its total value of orders declined to $170 million despite an increase in number of orders.
Source link : https://businessday.ng/companies/article/jumia-exits-south-africa-tunisia-to-focus-on-profitability/
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Publish date : 2024-10-16 12:53:22
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