Africa’s economy keeps growing despite the many challenges facing businesses and manufacturers. A key factor to this is the increasing participation of the continent in the global supply chain. Supply chain management largely contributes to the visible growth of Africa’s economy
The continent, equipped with the right resources and strategies, is set to become a hub for advanced technologies in industry. This also makes it a key player in the global supply chain.
Indeed, effective supply chain management will keep adding more growth to the economy. Even those who initially doubted its relevance have been proved wrong. Well-placed supply chains can work wonders for an economy like Africa’s, and Jumia is one such case.
A Jumia Story: How It Started
Jumia is the leading e-commerce company in Africa, founded in 2012. Since then, it has grown into one of the largest platforms by country on the continent, operating in 14 countries. Everything was smooth sailing until the company ventured into new areas.
By June 2013, Jumia had entered heights of achievement. This included the launch of Jumia Travel, which is a hotel booking platform, Jumia Food, and a food delivery platform. Thus, this journey towards growth also continued.
However, There were Challenges
As Jumia’s company expanded, so did its logistics and supply chain activities. Several reports highlighted the numerous challenges the company faced with timely product delivery. At the time, the average delivery speed ranged from 7-10 days, while customers across the continent were demanding faster service.
The logistics challenge was one of the issues Jumia had to deal with, a problem many African businesses are also familiar with. such as limited options when it comes to delivery, poor infrastructure and sometimes congested roads and others.
Jumia also faced challenges with payment and security concerns, expanding to limited access to digital payment options. These challenges included limited delivery options, poor infrastructure, congested roads, and more.
A Fresh Reset: How Jumia Overcame These Challenges
In 2018, Jumia took a different approach for a better turn of events. Jumia invested in logistics tech solutions, addressing their logistics challenges. This changed the narrative by helping them track and monitor their shipments, giving them more control of the whole process.
With time, Jumia was able to build a network of strong logistics hubs and sorting centres across different countries they operate in. Integration of warehouse facilities helped Jumia reduce its reliance on third-party logistics and gave it control over its delivery process.
There was a drastic change from the reform made. This led to an improved faster delivery of 2-3 days, widening their margin on customer satisfaction. Jumia also expanded in growth through a decreased logistics cost by 20%.
Keying into The Jumia Story
Africa’s growing economy reflects the great potential the continent houses.
Jumia showcased what growth-efficient supply chain management brings to a business – reducing the cost of logistics operations and expanding customer satisfaction. It also highlighted that an effective supply chain is key to unlocking potential business growth.
Wrap Up
Supply chain management, improving trade, creating jobs, enhancing competitiveness, and supporting SMEs can very well improve the challenges encountered in Africa’s economy.
As Africa’s e-commerce market grows, it is vital to use companies like Jumia as a roadmap for logistics and supply chain management.
Addressing challenges can prompt growth and play a critical role in Africa’s growing economy.
Mercy Nnaji is a seasoned journalist, reporter and media presenter. She enjoys contributing her opinions to trending topics within supply chain, politics and innovation.
