Africa’s e-commerce giant, Jumia, said it is reshaping its business strategy to defend market share, boost profitability, and restore investor confidence as Chinese e-commerce giants Temu and Shein intensify their presence in Africa.
Jumia CEO Francis Dufay stated this in an interview with the Financial Times, where he also disclosed that the company is in the process of “rebuilding credibility” with investors while positioning itself to better compete against Chinese low-cost platforms.
Temu and Shein are rapidly gaining traction in African markets with rock-bottom prices and fast logistics.
In response, Francis said Jumia is betting on partnerships with Chinese merchants to expand its catalogue and localise offerings.
“We believe we can fight them. We have more diverse product offerings in categories they can’t offer, we’re more tailored to the market, and we have competitive product offerings in their categories from our international sellers,” said Dufay.
Chinese team
To deepen its China trade pipeline, Jumia has built a 70-member team in Shenzhen, China, focused on onboarding Chinese sellers.
- According to Dufay, goods from these merchants, ranging from fashion to beauty and electronics, now account for about one-third of Jumia’s total sales volume.
- Dufay is also optimistic that the company could benefit from global supply chain shifts, particularly as Asian manufacturers seek new markets in response to U.S. trade tariffs.
“There’s a big, growing, undersupplied market here in Africa. Jumia is the middleman, and we could be in a good position to tap that market and serve our customers better,” he said.
Rebuilding investor trust
Dufay also acknowledged the company’s rocky history with public markets since its 2019 IPO on the New York Stock Exchange.
Once valued at over $1 billion, Jumia’s market capitalisation has now fallen to around $400 million, with its stock down nearly 90% since listing.
“My focus is very simple: we have to deliver the numbers. The target is break-even in 2027,” Dufay said, distancing his leadership from what he called past “overpromising and underdelivering.”
- The company has steadily cut costs under Dufay’s leadership since he took over in late 2022, slashing jobs, exiting unprofitable markets, and narrowing its footprint from 14 countries to nine. Losses have reduced significantly — from $206 million in 2022 to a projected $50–$55 million in 2025.
- Last month, Jumia’s largest institutional investor, Baillie Gifford, exited the company, a move Dufay is trying to counter with new investor outreach, including roadshows.
“Between now and 2027, we’ll just deliver the numbers, and that will be a lot more impactful than big speeches,” he said.
Nigeria remains key to Jumia’s growth
Despite scaling back operations elsewhere, Jumia is doubling down on core markets, particularly Nigeria, which Dufay described as offering the “greatest potential in terms of growth and profitability.”
He noted that Jumia’s Nigerian operations remain relatively small compared to the market opportunity, and the company plans to reach more low-income customers beyond major urban areas. Kenya, Uganda, and Egypt also present significant room for growth, he said.
- However, Dufay admitted that e-commerce across Africa still faces structural challenges, including low internet penetration, payment bottlenecks, and logistics issues, especially in regions where many consumers lack access to formal banking.
- Macroeconomic headwinds such as inflation and currency depreciation have further dampened growth prospects.
- But Jumia hopes that its strategy combining a leaner operation, localized offerings, and stronger supplier networks will help it weather the storm and reclaim its narrative in Africa’s e-commerce space.
