DHL to Compete With Jumia in E-commerce Space
International courier, shipping and packaging company, DHL Express, announced it would expand DHL Africa eShop service to other African nations.
Since the e-commerce app was launched in April, shoppers in 11 African countries have been able to shop across 200 U.S. and U.K. retailers with their local bank cards and have their goods delivered to them in Africa.
DHL Africa eShop presently operates using MallforAfrica.com’s white label service and Link Commerce but Kenya’s M-Pesa and Nigeria’s Paga power its payment system.
Currently, the e-commerce platform operates in Nigeria, Kenya, South Africa, Rwanda, Ghana, etc.
But because of the success recorded in the last seven weeks, the company has decided to extend its operations to more African nations just like Jumia, Africa’s largest e-commerce platform.
“The uptake and usage of this platform over the past seven weeks has been incredible, with exponential growth in subscribers and physical orders,” said Hennie Heymans, CEO of DHL Express sub-Saharan Africa.
The CEO said the e-commerce app will now be available in nine more countries in Africa. “Based on this rapid growth and the positive feedback that we have received from the market, DHL Express has decided to proceed to the next phase of the rollout as quickly as possible. The platform is now live for consumers in Cameroon, Democratic Republic of Congo, Côte d’Ivoire, Gabon, The Gambia, Madagascar, Mozambique, Tanzania and Zambia.”
Since Jumia listed on the New York Stock Exchange market in April and immediately rose by over 200 percent, investors and businesses have been looking to tap into seemingly untapped huge African e-commerce industry with over 240 million internet consumers.
This was after a report by Mckinsey Global Institute revealed that African e-commerce industry could worth $75 billion by 2025 in key economies on the continent.
While Jumia continues to expand operations and currently in 14 countries, infrastructural limitations and low operating capital remained a huge challenge.
DHL, however, has an edge with its broad logistic channel and decade of experience on the continent. Meaning, DHL has the brand reach to network, connect customers to more global brands and deliver quality goods faster and better. Eliminating some of the challenges currently hurting Jumia growth.
According to Heymans, “As the global leader in express logistics, DHL is well positioned to connect African consumers with these exciting global brands. We are committed to driving e-commerce growth on the continent on all fronts. We work with thousands of e-commerce brands in Africa and help them to reach global customers, and now with our DHL Africa eShop, we also connect African consumer to global brands.”
Again, while Jumia is building infrastructure from scratch, DHL is leveraging on its huge logistics across the continent and has already launched in 11 countries and just announced 9 more countries to take the total number of operating markets to 20 within just two months.
Jumia was accused of fraud by Citron Research in May, plunging it’s stock’s value by more than 50 percent from $46 to about $20, currently trading at $24.23 per share.
With over $1 billion in debt, Jumia needs to grow quick by leveraging on its local reach to compete with DHL Africa eShop.