In 2024, Jumia exited Tunisia and South Africa due to unfavorable political and economic conditions affecting consumer spending. The decision reduced operating countries to nine, primarily targeting West and East Africa, with a focus on achieving profitability after significant loss reductions. Affected employees received a $10 million severance package.
In late 2024, Jumia, Africa’s online retail platform, exited Tunisia and South Africa due to adverse political and economic conditions that inhibited consumer spending. The company’s operational focus has shifted to its strongest markets, reducing the number of countries from 11 to 9, primarily in West and East Africa. The exit has resulted in redundancy for affected employees, who received a substantial severance package totaling $10 million.
Jumia’s decision stemmed from an analysis of various macroeconomic indicators, including inflation rates, consumer confidence, GDP growth, and currency exchange dynamics. These considerations were outlined in filings to the US Securities Exchange Commission (SEC). The closure of operations affected Jade E-Services South Africa and Senegalese Jumia E-services but was not categorized as discontinued, as they were deemed not materially impactful on Jumia’s overall financial performance.
Moving forward, Jumia aims for profitability, having cut its losses significantly from $213 million in 2022 to $99.1 million in 2024. With the remaining operations spanning nine countries, Jumia targets a market that comprises over 625 million inhabitants, accounting for 54% of Africa’s internet users and 49% of the continent’s GDP.
Jumia’s exit from Tunisia and South Africa underscores strategic realignment driven by unfavorable economic conditions. The company is now focused on achieving profitability within more promising markets, despite the human resource impact of its decisions. Streamlining operations is essential for leveraging its substantial market presence across the remaining countries.
Original Source: thecondia.com
