BREAKING:Jumia Food will cease operations in Nigeria starting December 2023.

In a strategic move, Jumia is set to close down its food delivery service, Jumia Food, across its operational countries, which include Nigeria, Kenya, Morocco, Ivory Coast, Tunisia, Uganda, and Algeria, by the end of December 2023. The company is reallocating its focus to its primary business of physical goods and the Jumia Pay platform across its 11 countries of operation.

Francis Dufay, Chief Executive Officer of Jumia, explained, “The more we concentrate on our physical goods business, the more we recognize the immense potential for Jumia to expand with a path to profitability. We must make the right decision and fully direct our management, teams, and capital resources to pursue this opportunity. In the current context, it means exiting a business line that we believe does not offer the same upside potential – food delivery.”

Despite contributing 11% to Jumia’s Gross Merchandise Value (GMV) in the first nine months of 2023, Jumia Food has faced challenges in achieving profitability since its establishment. The total value of food sold on Jumia Food during this period was $64 million (11% of $581 million). This reflects the extensive scale of Jumia Food’s operations but does not necessarily translate into revenue or profitability.

Jumia Food experienced fluctuating fortunes since its inception, with a notable 82% year-over-year growth in 2021, showcasing the company’s strong presence in the food delivery sector. However, in 2023, there was a significant decline in Quarterly Active Consumers and Orders, a consequence of the company’s shift toward profitability by concentrating on viable categories and reducing consumer incentives.

Regarding employees associated with Jumia Food, the company has indicated that some will transition to the core physical goods segment, implying that there might be workforce adjustments, including potential layoffs.

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BREAKING:Jumia Food will cease operations in Nigeria starting December 2023.