E-commerce platform Jumia cannot guarantee the safety and quality of products sold by vendors enlisted on its platform, an indicator that its customers risk health and physical hazards over items purchased on the platform.
Jumia, which enables customers to buy items from local and Chinese vendors, made the revelation on the US Securities and Exchange Commission (SEC) filing of its initial public offering (IPO) on the New York Stock Exchange.
The e-commerce platform admitted that it was hard for it to police its third-party vendors and would in future have no grounds to stop litigation over product liability claims.
Online marketplaces in general are known to be a haven for scammers, counterfeiters and products that are misrepresented.
To this end, Jumia has a return policy in place for items worth more than Sh1,500. The 90-day cover is only for faulty electronic products purchased locally. The cover does not include beauty, consumables and items shipped in from the Chinese vendors.
“As the goods offered through our marketplace are manufactured by third parties, we have only limited control over the quality of these goods. We cannot always effectively prevent our sellers from selling harmful or defective goods, which could cause death, disease or injury to our consumers or damage their property,” Jumia’s IPO prospectus reads.
Kenyans buying products through the platform, especially from China, are at a greater risk of purchasing sub-standard items that pose danger to consumers.
A 2016 report by the US Chamber of Commerce’s Global IP Centre shows that 86 percent of world’s counterfeit foods originate from Asian country.
“…There is no guarantee that we will be adequately insured against such risks or that we will be able to take recourse against the sellers or suppliers from whom we sourced these goods, in particular if the seller or supplier is located in a foreign country where enforcement of our rights may be difficult, such as China,” Jumia said.