E-commerce firm Jumia Technologies will close its food delivery business in all seven countries in which the unit operates by the end of the year to focus on growing its core online retail business.
Jumia is aggressively cutting costs in order to turn profitable, including headcount reductions, exiting everyday grocery items and reducing delivery services not related to its e-commerce business.
Jumia said in a statement that food delivery was “a business with very challenging economics”, and it decided to focus on the physical goods side of the business, where mobile phones are the most ordered item on the company’s platform.
Jumia was the first Africa-focused tech firm to list on the New York Stock Exchange in 2019 – about seven years after it was launched in Nigeria by two French entrepreneurs.
The move is in line with Jumia’s “strategy to optimize its capital and resource allocation and to continue its path to profitability,” the retailer said, adding that Jumia Food is not suitable to the current operating environment and macroeconomic conditions.