It was last November, a clap of thunder resounded in the sky of African e-commerce. The two founders of Jumia, the French Sacha Poignonnec and Jeremy Hodara, founders of the company, were disembarked from the management by the shareholders, dissatisfied with the lack of results. Since then, the Franco-Ivorian Francis Dufay has refined a recovery plan intended to ensure the profitability of Jumia, the African Amazon.
Ten years after its beginnings, Jumia, an e-commerce pioneer in Africa, is going through its most serious crisis. After losing hundreds of millions of dollars in recent years, we are talking about almost half a billion, the shareholders thanked the founders. A sanction inherent in the capitalistic model of Jumia, according to Jean-Michel Huet, specialist in e-commerce at the consulting firm Bearing Point.
« The current situation is also the consequence – advantages and disadvantages – of having decided to list this company on the stock market. “, explains the specialist. ” From the moment we go on the stock market, it’s great, because we can raise funds, and therefore have the means. The downside is that we have new shareholders who are also decision-makers and who, if they feel that things are not going in the right direction, can very well oust management. And sometimes, in the direction, there are also the founders “, he adds.
Exit therefore Sacha Poignonnec and Jeremy Hodara, the supervisory board appointed last November, Francis Dufay, who joined Jumia in 2014. He worked on a recovery plan for many weeks. ” We’ve built a brand, we’ve built relevance for our suppliers, our vendors and our logistics partners, but besides that, we’re still not making money. he says. “ So we are at a turning point where we have decided to refocus very strongly on our profitability, the preservation of cash and the reconstruction of sound fundamentals for the business. »
Cost hunting
Recovery requires a cost hunt that is all the more complex in that it must not harm the core business. ” We stopped, stopped or paused a number of projects on which we did not see profitability. For example, Jumia Prime which was our free delivery subscription program », continues Francis Dufay. “ Our logistics service for third parties, which has been refocused on three countries out of the group’s eleven. The goal is really to carry out a smaller number of projects and to be able to succeed in them on a tighter perimeter and more in line with the resources at our disposal. »
For Jean-Michel Huet, Jumia will not only be judged on its financial results. ” The results, it’s not just to have profitability, it’s also to know if in the ten countries where Jumia is present, will it succeed in gaining market share, will it succeed to develop certain businesses in depth, and to fight against competition. We hear about the arrival of Amazon in Nigeria. »
A competition that does not scare Francis Dufay. Amazon is already present in Egypt, the second country for Jumia in terms of activity.