Africa-focused e-commerce retailer Jumia Applied sciences will shut its South African on-line trend retailer Zando and its Tunisian operations by the tip of the 12 months to sharpen its deal with its different markets.
Jumia is aggressively reducing prices to attempt to flip worthwhile, together with by decreasing head rely, exiting on a regular basis grocery gadgets and meals supply and reducing supply companies not associated to its e-commerce enterprise.
“The trajectory of the nations didn’t align with the technique of the group,” CEO Francis Dufay stated, citing complicated macroeconomics, the aggressive atmosphere and low medium time period potential for development and profitability.
“We consider it’s the best determination,” he added. “It allows us to refocus our sources on the opposite 9 markets, the place we see extra promising developments by way of scale and profitability.”
Jumia’s remaining markets embrace Egypt, Kenya, Morocco and Nigeria. Dufay stated success in any would “simply allow us to recuperate” misplaced volumes from South Africa and Tunisia.
These two companies accounted for under 2.7% of whole orders and three% of gross merchandise worth within the six months ended 30 June 2024, Dufay stated.
Zando.co.za was based in 2012 and since then has grown to turn out to be a widely known South African on-line trend platform. In Tunisia, the enterprise has been working beneath the Jumia model for a decade, promoting common merchandise.
Clearance gross sales
Dufay stated he was not planning to promote both operation, which can maintain clearance gross sales earlier than shutting.
The closures imply axeing about 110 jobs, Dufay stated, however some could also be relocated to different components of the group’s enterprise.
The exit in South Africa follows shortly after the nation’s largest on-line retail group Takealot Group introduced the sale of its on-line trend enterprise Superbalist in September, amid growing competitors from fast-fashion Chinese language e-commerce retailers Shein and Temu.
Learn: Zando launches new unit to counter Shein and Temu
Dufay stated in South Africa “development potential was positively harder” due to the extremely aggressive atmosphere. — (c) 2024 Reuters
