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African online retailer Jumia to exit South Africa and Tunisia
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African online retailer Jumia to exit South Africa and Tunisia
Oct 17, 2024 1:17 PM

By Nqobile Dludla

JOHANNESBURG, Oct 16 (Reuters) - Africa-focused

e-commerce retailer Jumia Technologies will close its

South African online fashion retailer Zando and its Tunisian

operations by the end of the year to sharpen its focus on its

other markets, the CEO told Reuters.

Jumia is aggressively cutting costs to try to turn

profitable, including by reducing head count, exiting everyday

grocery items and food delivery and cutting delivery services

not related to its e-commerce business.

"The trajectory of the countries did not align with the

strategy of the group," CEO Francis Dufay said, citing complex

macroeconomics, the competitive environment and low medium term

potential for growth and profitability.

"We believe it's the right decision," he added. "It enables

us to refocus our resources on the other nine markets, where we

see more promising trends in terms of scale and profitability."

Jumia's remaining markets include Egypt, Kenya, Morocco and

Nigeria. Dufay said success in any would "easily enable us to

recover" lost volumes from South Africa and Tunisia.

These two businesses accounted for only 2.7% of total orders

and 3% of Gross Merchandise Value in the six months ended June

30, Dufay said.

Zando.co.za was founded in 2012 and since then has grown to

become a well-known South African online fashion platform. In

Tunisia, the business has been operating under the Jumia brand

for a decade, selling general merchandise.

Dufay said he was not planning to sell either operation,

which will hold clearance sales before shutting.

The closures mean axing about 110 jobs, Dufay said, but some

may be relocated to other parts of the group's business.

The exit in South Africa follows shortly after the country's

biggest online retail group Takealot announced the sale of its

online fashion business Superbalist in September, amid

increasing competition from fast-fashion Chinese e-commerce

retailers Shein and Temu.

Dufay said in South Africa "growth potential was definitely

more difficult" because of the highly competitive environment.

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