E-commerce firm Jumia Kenya has sent home about six percent of its local employees, coming days after its parent company announced the closure of its operations in three countries.
Berlin-based Jumia Technologies recently shut down operations in Cameroon, Tanzania and Rwanda.
“After careful consideration, we have made the difficult decision to undergo some headcount reductions across our business verticals and geographies,” Jumia’s local office said in a statement.
“While decisions like these are always difficult, we need to put our focus and resources where they can bring the best value and help Jumia thrive. We are supporting all impacted employees during this period of transition.”
The company did not specify the number of affected employees. Kenya is its largest market in East Africa where it had 686 employees as of December 2018.
Its parent company made a net loss of €163.4 million (Sh18.3 billion) in the nine months ended September, representing a 39 percent jump from €117.3 million (Sh13.1 billion) the year before.
This was despite sales rising 28 percent to €111.1 million (Sh12.4 billion) from €86.7 million (Sh9.7 billion), with the larger loss brought by a surge in administrative and other expenses.
Jumia says it will continue to balance growth with profitability, adding that it will seek to focus on more promising markets that can help it reverse its losses.
“We regularly conduct portfolio reviews which assess the allocation of our resources to business verticals and geographies against multiple criteria, including financial performance, commercial environment as well as the ease and cost of doing business,” the company said.
“As part of this year’s portfolio review, a number of initiatives are underway…These initiatives are aimed at enhancing our business focus and allocating investment, resources and talent to those areas that we believe present the best opportunities to support the company’s long-term growth and the path to profitability.”
Jumia also announced the shutting down of its travel agency business, Jumia Travel, and transferred the operations to booking portal Travelstart.
Jumia Travel had offices in six countries with Africa and this includes Dar es Salaam, Abidjan and Lagos.
“In TravelStart, we have found the perfect partner to build on the success Jumia Travel has achieved so far,” the company said in a statement.