By AYOOLA OLAOLUWA
Troubled e-commerce giant, Jumia, has adopted new business models to survive market challenges after its much celebrated listing on the New York Stock Exchange (NYSE) turned sour, Business Hallmark can reveal.
Thee-commerce firm, it would be recalled, had in April 2019, listed its shares on the NYSE, opening trading at $14.50 under the ticker symbol of JMIA.
The stock price of the firm, which had offered 13,500,000 American Depository Shares, representing 27,000,000 Ordinary Shares, had hit its highest peak of $59.96 on January 25, 2021, just 10 months after it was listed on the NYSE.
However, following allegations of irregularities and ‘cooking’ of its books by a media outfit, the firm’s stock prices slumped, pushing the once valued firm to the brink of financial ruins.
As of 5:10PM of Friday, June 17, 2022, the firm’s share was trading at $6.27, about $53.69 short of its peak of$59.96onJanuary25,2021.
For the company generally praised as ‘Africa’s Pride’ in 2019, it has been from one trouble to the other. For instance, it closed shop in three African countries of Gabon, Congo DR and Cameroon.
Apart from its businesses shrinking from 14Africancountries to11, Jumia had continued to declare huge losses year-in year-out. In fact, the firm had never declared a profit since it was founded ten years ago.
According to the company’s financial statements obtained by Business Hallmark, the firm made a loss of $53.4million in 2019 and $28.3million in2020.
It further declared a staggering loss of $84.7 million in FY 2021. The firm did not fare better in 2022 as it has declared loses in the first quarter of the year.
In its most recent financial report released in May, the company anounce an EBITDA (interest,taxes, depreciation and amortisation) loss of $53 million in Q1 2022.
Meanwhile, determined to halt the company’s streak of losses and and underperformance, its management is adopting new strategies to survive market challenges.
One of such innovations is the e-doctor, atelemedicine service meant to provide quality, affordable and digital real-time healthcare consultations to millions of poor Nigerians for just $1 (N600).
To effectively deliver the service, Jumia is partnering with a service provider, Meeting Doctor, and the Consultative Group to Assist the Poor (CGAP), a global partnership of more than 30 leading organizations focused on financial inclusion to improve the lives of lower-income populations.
With the scheme, the firm’s consumers will have access to a licensed doctor through the e-doctor service on the JumiaPay app.
According to the company, the medical scheme seeks to address healthcare access issues faced by millions of Nigerians, including crowded hospitals and long waiting times.
“We’re excited to offer consumers a platform to connect with an online e-doctor easily and conveniently. Aside from paying for utility bills, buying tickets, data, and airtime on the JumiaPay app, consumers can now benefit from high-quality healthcare on their terms.
“Whether they want to inquire about or ask a doctor about symptoms while at work, this service aims to provide consumers with the help they need at their convenience and comfort.
“We remain committed to using technology to improve people’s lives and solve real-life problems,” said Jumia Nigeria’s Chief Executive Officer, Massimiliano Spalazzi.
Also speaking at the event, the Chief Executive Officer (CEO)of Africa at Meeting Doctors, Alvaro Oteyza, noted that his company partnered with Jumia to provide quick healthcare access to consumers.
“By introducing and integrating our medical consultation service to the JumiaPay platform, we are providing a convenient and affordable way for consumers to connect with a doctor.
“We have a team of highly trained and qualified doctors so consumers can be assured of the best care in real-time,” Oteyza stated.
To participate in the health scheme, subscribers must first download the JumiaPay app on their devices and then pay an initial subscription fee of N1,500 only for the e-doctor service. The subscription fee lasts for three months only.
Subsequently, subscribers will be paying $1 (N600) per month subscription fee to enjoy the service.
Jumia workers, including sellers, JForce agents, riders and Jumia Nigeria employees will enjoy thee-doctorservice forfreeforsixmonths.
Sources in Jumia, who spoke with our correspondent, said the initiative, which will rely heavily on the nation’s vast mobile internet network, is a bold move to fully tap into the recently launched government’s healthcare scheme for the poor and vulnerable in the country.
It would be recalled that President Muhammadu Buhari had in May this year signed into law a National Health Insurance Authority Bill 2022. The scheme is to cover about 83 million poor Nigerians who cannot afford to pay the health insurance premium.
“We expect to cover a large chunk of the 83 million Nigerians who are not buoyant enough to afford the normal health insurance premium of about N4,000 currently packaged by the National Health Insurance Scheme (NHIS) and Health Management Organisations (HMOs).
“Imagine us getting just 25 percent of the number which is over 20 million people. That is over $20million dollars in a month. Spread that over one year, we are looking in the region of over $250 million. I think that is huge!
“As an early entrant, we hope to be far ahead of competitors who will be entering the business later in the day when the market would have been fully saturated with health products providers”, a source in Jumia informed BH.
Apart from the $1 health initiative, Jumia also recently partnered with an American courier and logistics giant, the United Parcel Service (UPS), to help expand its delivery services for businesses and consumers across the African continent.
According to the e-commerce firm, the deal will enable UPS to leverage Jumia’s infrastructure to offer its customers an extended range of delivery solutions, including door to door package delivery and collection, with various payment options.
However, the collaboration will initially cover three countries, namely Morocco, Kenya and Nigeria.
While plans are on to expand to West African countries of Cote d’Ivoire, Ghana, as well as other countries where Jumia operates.
Speaking on the partnership, the Co-CEO, Jumia, Sacha Poignonnec, said, “We have this vast, untapped market opportunity both on the e-commerce and payment fronts, and in this context, we really want to establish Jumia as the go-to destination for consumers, and we want to develop Jumia Pay into a payment and fintech champion on the continent over the next few quarters,”
Also speaking, the UPS Head of Strategy for the Indian subcontinent, Middle East and Africa, UPS, Renzo Bravo, said the collaboration with Jumia will enable the Atlanta-Georgia based firm build a greater presence in several African markets and tap into an anticipated boom in online retail.
“We believe that Africa has the potential to reach around $180 billion in online trade by 2025 that will enable growth and commerce, not only across Africa but also from the continent to the world and from the world to Africa”, Bravo stated.
The e-commerce firm has also expanded the range of digital and financial services it is offering its consumers.
For instance, its Nigerian customers can now book bus tickets via the JumiaPay app.
It was widely reported in March that billionaire businessman and Chairman of the Zinox Group, Leo Stan Ekeh, was interested in buying Jumia. Ekeh had been scooping Jumia’s shares, fueling reports that a possible acquisition was going was in the offing.
However, officials of Konga, though acknowledging that a deal is possible in the nearest future, declared that Ekeh had not made known his intention to acquire Jumia.