Jumia Food to shutdown in Nigeria from December 2023

In a significant strategic move, Jumia has decided to close down its food delivery service, Jumia Food, across its operating countries, including Nigeria, Kenya, Morocco, Ivory Coast, Tunisia, Uganda, and Algeria by the end of December 2023. The decision comes as part of the company’s plan to focus on its core physical goods business and the Jumia Pay platform across its 11 countries of operation.

Francis Dufay, Chief Executive Officer of Jumia, emphasized the decision to exit the food delivery business, stating, “The more we focus on our physical goods business, the more we realize that there is huge potential for Jumia to grow, with a path to profitability. We must take the right decision and fully focus our management, our teams, and our capital resources to go after this opportunity. In the current context, it means leaving a business line, which we believe does not offer the same upside potential – food delivery.”

Despite representing 11% of Jumia’s Gross Merchandise Value (GMV) in the first nine months of 2023, Jumia Food has faced challenges in achieving profitability since its inception. The company reported a decline in Quarterly Active Consumers and Orders in 2023 due to its strategic shift towards profitability by focusing on viable categories and reducing consumer incentives.

Bolt Food, another significant player in the African food delivery market, also announced its exit from Nigeria and South Africa in December 2023, citing economic downturns, high inflation, and intense competition as contributing factors.

While Jumia Food’s shutdown highlights the complexity of the African food delivery landscape, other players like Glovo and Chowdeck continue to navigate the challenges. Glovo, based in Barcelona, has expanded its presence in Sub-Saharan Africa with strategic partnerships, while Chowdeck, a key player in Nigeria, recently celebrated delivering food worth over ₦1 billion ($1.2 million) in a single month.

However, the path to profitability in the food delivery market remains challenging globally, as seen in the experiences of Jumia Food and Bolt Food, as well as larger players like Doordash and Uber in the United States. Despite the challenges, the African food delivery market is expected to grow, presenting both opportunities and obstacles for players in the industry.