Jumia is set to discontinue its food delivery service, Jumia Food, in all operational countries, including Nigeria, Kenya, Morocco, Ivory Coast, Tunisia, Uganda, and Algeria by the end of December 2023.
The company’s focus across its 11 operational nations will shift towards the Jumia Pay platform and its core physical goods business.
Despite Jumia Food contributing 11% to Jumia’s Gross Merchandise Value in the first nine months of 2023, the service has struggled to turn a profit since its inception.
In that period, the total value of food sold on Jumia Food amounted to $64 million, representing 11% of $581 million, showcasing the service’s substantial scale but not its profitability.
While Jumia Food demonstrated an impressive 82% year-over-year growth in 2021, it faced challenges in 2023, experiencing a significant decline in Quarterly Active Customers and Orders.
This shift was a strategic move to focus on profitable areas and reduce customer incentives to enhance overall profitability.
Concerning Jumia Food staff, the company states that some will transition to the primary physical goods division, potentially leading to layoffs.
Coinciding with Jumia Food’s closure, Bolt Food, a major player in the African food delivery industry, has announced its exit from South Africa and Nigeria in December 2023.
Bolt Food’s demise is attributed to economic downturns, high inflation, and intense competition from established rivals like Jumia Food, Gokada, and Uber Eats, despite its efforts to expand into major Nigerian cities such as Lagos.
