Rocket Internet’s Africa Retail Unit Strikes Gold in Ivory Coast – Bloomberg
Ivory Coast’s biggest online retailer will enable consumers to buy goods from international markets for the first time next month as it seeks to tap a shopping boom in one of sub-Saharan Africa’s fastest-growing economies.
Jumia, an internet platform whose investors include Berlin-based Rocket Internet SE and Goldman Sachs Group Inc., is expanding its Ivory Coast operation by adding imports from Asia and Europe, managing director for the country, Francis Dufay, said in an interview in the commercial capital, Abidjan. The retailer is also recruiting local shopkeepers to sell directly via its platform as “the more vendors you have, the wider your assortment of goods and the more interesting you become for a wide range of people,” he said.
Ivory Coast has emerged as the most successful of Jumia’s 11 African markets on a per capita basis, according to Dufay, who added that sales volumes in the West African country are growing at between 25 percent and 30 percent per year. Customers range from middle-class civil servants to minimum-wage domestic workers, while the availability and affordability of smartphones has made online shopping easier.
The company has been able to tap into a retail industry that’s taken off in Ivory Coast under the Presidency of Alassane Ouattara, who assumed office six years ago and set out an ambitious development plan to turn the page on a decade of conflict and instability. New luxury hotels, bakeries and shopping malls in Abidjan are testimony to average economic growth of 9 percent since 2012, with the International Monetary Fund expecting 8 percent expansion this year. The sub-Saharan Africa average growth forecast for 2017 is 2.9 percent.
“What we’re seeing is a market where the transition toward e-commerce is going much faster than in Europe or the U.S.,” Dufay said. “People here love new technologies, new things, but they weren’t very connected because access to internet used to be very expensive. We have lots of clients who’ve never touched a computer in their lives.”
Junia was founded in 2012 and is based in Lagos, Nigeria. Alongside Rocket, investors include South African wireless operator MTN Group Ltd. and French insurer AXA SA.
The recent arrival in Abidjan of international retailers including Carrefour SA, France’s biggest grocery chain, and the launch of a new online platform by a local supermarket group is already making Ivory Coast’s retail sector “pretty crowded,” Dufay said. Promising a two-week delivery deadline for imported goods and charging as little as $2 for shipping items to towns in the interior, Jumia is trying to stay ahead of an increasingly congested online marketplace, he said.
“The market is very competitive, especially in Abidjan, everybody is doing retail nowadays,” he said. “It’s only a few years ago that the market for quality retail goods wasn’t very developed, and now there are some areas in Abidjan were it’s already overdeveloped.”