Jumia has announced its decision to discontinue its food delivery service, Jumia Food.
The Pan-African e-commerce platform explained that its food delivery business does not align with the current operational landscape and prevailing macroeconomic conditions in the seven markets, including Nigeria, Kenya, Uganda, Morocco, Tunisia, Algeria, and Ivory Coast.
Consequently, Jumia will conclude its food delivery operations across these markets by the end of December 2023.
“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,” Mr Francis Dufay, the Jumia Group chief executive officer, said in a statement Wednesday.
Jumia Food accounts for approximately 11% of Jumia’s overall merchandise value for the nine months ending on September 30 and has remained unprofitable since its inception.
Jumia also stated that employees currently assigned to the food delivery business will transition to the ongoing physical goods business in the seven countries. The company emphasized that this strategic shift underscores its commitment to achieving profitable growth.
Mr. Antoine Maillet-Mezeray, the Executive Vice President of Finance and Operations at Jumia, commented that food delivery remains a business with very challenging economics, both in Africa and globally.
He noted, “We want to focus our efforts on our physical goods e-commerce business in the [11] markets where we operate. This is a matter of prioritization of opportunities and expected return on investment.”
