11% of Jumia’s Gross Merchandise Value in the first nine months of 2023, the company has had difficulty turning a profit since its founding.
Jumia will cease operations for its food delivery service, Jumia Food, in all of its operational countries, which include Nigeria, Kenya, Morocco, Ivory Coast, Tunisia, Uganda, and Algeria by the end of December 2023.
The company’s current priorities across its 11 operational nations are the Jumia Pay platform and its core physical goods business.
Even though Jumia Food accounted for 11% of Jumia’s Gross Merchandise Value in the first nine months of 2023, the company has had difficulty turning a profit since its founding.
This indicates that between January and September of 2023, the total value of food sold on Jumia Food was $64 million, or 11% of $581 million. a measure of the enormous size at which Jumia Food was functioning, but it is not a measure of profits.
Jumia CEO, Francis Dufay, said on Wednesday the company will now refocus on its core physical goods business and payment platform.
He stated, “The more we focus on our physical goods business, the more we realise that there is huge potential for Jumia to grow, with a path to profitability.
“We must take the right decision and fully focus our management, our teams, and our capital resources to go after this opportunity. In the current context, it means leaving a business line, which we believe does not offer the same upside potential – food delivery.”
“The company further explained that a number of employees at Jumia Food will transition to the core physical goods segment.
Their exit is coming after Bolt Food, another major player, also announced its withdrawal from Nigeria and South Africa, highlighting the harsh realities of the African food delivery landscape.
