Jumia Moves Top Bosses to Africa from Dubai in Profit Push

  • In Business
  • 2022-12-05 08:44:30Z
  • By Bloomberg

(Bloomberg) -- Jumia Technologies AG is closing its office in Dubai and moving senior management to the African countries they oversee as part of a plan to cut losses and redirect the company after its founders quit last month.

Most Read from Bloomberg

  • China's Covid Pivot Accelerates as Cities Ease Testing Rules

  • OPEC+ Pauses as Russia Sanctions and China Covid Rules Roil Crude Markets

  • OPEC+ Latest: Group Agrees to Keep Oil Production Unchanged

  • Elon Musk Says Apple Is 'Fully' Advertising on Twitter Again

  • This Stock Strategist Says We'll See 5% Inflation for the Next Decade

Managers will move to countries in their region, with most going to Morocco, Kenya and Ivory Coast, and the 60-person Dubai office will be disbanded, Jumia's acting head Francis Dufay said in an interview.

"As we are an Africa-focused company, we want our leaders to be based with customers, vendors and employees," he said.

Dufay took over after founders Sacha Poignonnec and Jeremy Hodara left the online retailer last month. He said he's attempting to cut costs -- Dubai's rents are rising faster than those in New York or London -- and become more responsive to the young, tech-savvy population in its African markets while fending off larger competitors.

Read More: Co-Founders Depart Africa's Rival to Amazon as Losses Pile Up

Jumia went public in 2019 in a New York listing where it was was hailed as the Amazon of Africa. Since then, it's been struggling with persistent losses and its shares have dropped 68%. Meanwhile, Amazon.com Inc. is planning to expand its e-commerce service into some of the larger African markets as soon as next year, people familiar with the matter said.

A representative for Amazon didn't immediately respond to a request for comment.

Still, Dufay said that the company's more than 10 years of experience operating in Africa give it an advantage over new competitors. For example, Jumia has built a logistics business from scratch to deal with the lack of formal addresses and city mapping in many of the areas where it makes deliveries.

The company, which was one of the first African companies to achieve so-called unicorn size and has attracted investors such as French drinks maker Pernod Richard SA and US investment bank Goldman Sachs Group Inc., plans to reduce its losses over the next 12 months, Dufay said, without elaborating. Jumia previously guided that it expects an adjusted Ebitda loss of $200 million to $220 million this year.

He said he'll double down on Jumia's "bread-and-butter" e-commerce categories, including fashion, beauty, consumer electronics and appliances. The company will also pause the logistics services it offers third parties in its operating countries except for Morocco, Nigeria and Ivory Coast, he said.

"We have spread ourselves a bit too thin in the past by pushing many projects across our markets," he said. "We are at a very interesting point in the life of the company, as the board appointed a new leadership more focused on the on-the-ground operations to drive a new plan to lead to a significant improvement on the profitability trajectory."

(Added Dufay timeline on cutting losses in 8th paragraph)

Most Read from Bloomberg Businessweek

  • 11 Hours With Sam Bankman-Fried: Inside the Bahamian Penthouse After FTX's Fall

  • TikTok's Viral Challenges Keep Luring Young Kids to Their Deaths

  • Can Duolingo Actually Teach You Spanish?

  • Ryanair, EasyJet Scale Back in Germany Over Airport Fees

  • Forget Zoom Calls, Remote Work Startups Want to Build a Virtual Office

©2022 Bloomberg L.P.


More Related News

European Gas Prices Swing as Traders Track Demand, Stockpiles
European Gas Prices Swing as Traders Track Demand, Stockpiles

(Bloomberg) -- European natural gas fluctuated as the return of warmer weather keeps a lid on heating demand, even as cheaper fuel brings the possibility of ...

Malaysia's Anwar Vows Gradual Debt Reduction to Ensure Stability

(Bloomberg) -- Malaysia's Prime Minister Anwar Ibrahim said his government will work to gradually lower the nation's debt and narrow the budget gap, without ...

Spanish Inflation Unexpectedly Jumps After Months of Easing
Spanish Inflation Unexpectedly Jumps After Months of Easing

(Bloomberg) -- Spanish inflation unexpectedly quickened, snapping five months of slowdowns, prompting traders to boost bets on how high the European Central ...

Adani Labels Fight With US Short Seller as Attack on India
Adani Labels Fight With US Short Seller as Attack on India
  • World
  • 2023-01-30 06:49:58Z

(Bloomberg) -- The Adani Group has cast its brawl with a US short seller as an attack on India and the issue could overshadow parliament's budget session...

Standard Chartered Warns of Reality Check for
Standard Chartered Warns of Reality Check for 'Goldilocks' Rally

(Bloomberg) -- From stocks to corporate credit markets, investors are indulging in wishful thinking by bidding up prices of risky assets on wagers that...

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply


Top News: Business