Jumia Layoff 900 workers from the company

Jumia, Africa’s e-commerce group has slashed about 20% of its workforce in a recent layoff exercise in the company.

The layoff exercise saw the exit of 900 people from the company.

The company disclosed the new development in its Q4 2022 financial result.

Moreover, Jumia had hinted at the possibility of cutting off some heads last year as part of its strategies to cut costs and reduce loss.

Jumia’s re-organization also saw a significant reduction in its presence in Dubai which houses some of its management functions.

Also, Jumia reported that its headcount in Dubai has been reduced by 60% while most of the remaining staff are being relocated to its African offices, where it will be closer to its customers, sellers, and operations.

Jumia explains how the headcount reduction would affect them

“We expect these headcount reductions to allow us to save over 30% in monthly staff costs starting from March 2023, as compared to the October 2022 staff cost baseline.

“The implementation of these organizational changes resulted in $3.7 million in one-off restructuring costs booked in the fourth quarter of 2022.”

Jumia reveals other strategies

Jumia has revealed that it also focused on driving marketing efficiencies which have allowed it to reduce sales and Advertising expenses by 41% year-over-year in the fourth quarter of 2022.

Also, the company stated that they are working on optimizing the returns on its paid online marketing investing investments by rationalizing marketing channels.

“We are also working on a comprehensive plan to drive fulfillment cost efficiencies. This includes several actions such as optimizing our footprint and logistics routes, improving warehousing staff management and productivity, reducing packaging costs, and many more. We have seen early signs of success of this strategy in our e-commerce physical goods business where the freight & shipping cost per package decreased by 23% year-over-year in the fourth quarter of 2022,” the company stated.

Jumia’s new Chairman

Meanwhile, Jumia has disclosed that Francis Dufay, who was previously appointed Acting CEO has now been appointed CEO of Jumia by the Supervisory Board.

According to the company, the executive search that was being conducted has now been concluded.

It added that the appointment reflected the strong confidence of the Board in the leadership of Francis and his ability to successfully scale the business to profitability.

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