Jumia’s new business model is made in China

China is where you go when you want to mass-produce cheap, affordable products, and Jumia is the latest company to take that path. While disciplined marketing, cheaper fulfilment, and a leaner cost base have dominated stories about the company’s recent turnaround, the truth is simpler: Africa’s biggest e-commerce company is becoming increasingly dependent on Chinese supply.

As of September 2025, Jumia had about 24,000 China-based sellers on its marketplace and roughly 2.2 million China-sourced items sitting in its warehouses across Africa, according to its 2025 Investor Day presentation on November 13, 2025. Of its over 25,000 international merchants, Chinese partners dominate. In Q3 2025, items sold from China grew 55% year-on-year.

This pivot is deliberate. Jumia has shifted from chasing Africa’s aspirational higher middle class to serving the continent’s lower-middle-income consumers. And this requires a supply base that matches the actual spending power of African households. 85% of Africans live on less than $5.50 a day ($165 per month), according to the World Bank.

“Our customers are the lower middle class of Africa… people making $150 to $400, $500 a month,” group CEO Francis Dufay said during the investors’ day presentation. “The fantasised middle class making $2,000 and driving to work does not exist.”

Before 2022, Jumia leaned heavily toward big global brands and aspirational items. But that audience was small, and the unit economics did not scale.

“The price points were too high because of too much focus on fancy brands,” Dufay said during the presentation. “People love to focus on Apple and L’Oreal rather than cheap white-label brands from China. We had to change that.”

Early days

Jumia began operations in Lagos in 2012 with ambitions of becoming the Amazon of Africa: a one-stop online marketplace for electronics, fashion, groceries, and more. It burned cash on marketing and discounts, riding the wave of Africa’s then-emerging middle class.

By 2019, the company became the first African tech company to list on the New York Stock Exchange at $14.50 per share, hitting unicorn status. But its operating losses mounted. At its peak, Jumia operated in 16 countries across many verticals, including food delivery.

“After the IPO in New York in 2019, the company was able to raise a lot of money and burn it very fast, quite helped at the time by the COVID bubble,” Dufay said during the presentation. “Jumia was at a phase of growth at all costs, like a lot of other tech companies, and it came with negative consequences on the quality of operations and unit economics.”

By late 2022, Jumia was burning $200 million a year, triggering a leadership overhaul. Over the last three years, the company has aggressively cut costs and clarified its identity. It has exited unprofitable verticals, stopped stocking categories such as groceries, pulled out of several countries, and reduced staff from 4,500 to 2,000. It shifted fulfilment toward pickup centres, now 72% of deliveries, up from 38% in Q3 2022.

“It is a big relief that we are finally able to focus only on e-commerce,” Dufay said.

The results are beginning to show: revenue is up 6.79% to $45.6 million in Q3, 2025, from $42.7 million in Q3, 2021. Operating loss is down 72.81% to $17.4 million from $64 million. Advertising spend per order is down $0.9 from $2.9 in Q3, 2022. Fulfilment cost per order is down to $2.1 from $3.5.

Jumia’s share price closed in November 2025 at $12.68, with a $1.55 billion market cap, and it only operates in nine countries now.

The China engine  

China fits Jumia’s new ethos: right price points, deep assortment, fast iteration, and manufacturing partners willing to retool quickly. Shoes at $3, headphones at $5, and backpacks at $8, to match Jumia’s new customer base.

As of September 2025, 64.71% of the 3.4 million internationally sourced items Jumia sold came from China.

According to Hisham El Gabry, Jumia’s group chief commercial officer, China’s value is not just cost. “The main thing for us is the entrepreneurial mindset that we can scale fast, and try things very efficiently and very fast together,” he said during the investors’ day presentation.

He cited an example from the peak of Nigeria’s fuel crisis, when Jumia needed to design a solar-powered generator tailored to the market. “We had to try multiple variants and iterations with many of our partners to get to the right balance… We couldn’t have done this without having someone sitting on an established manufacturing capability and willing to try with you a lot.”

Jumia now has a 60-plus team managing its end-to-end China chain.

“We have all of this as a self-reliant team in China. And because of that, we can keep our supply coming in. It is a very clean supply chain in millions and millions of units today,” El Gabry said at the investors’ day presentation. “The growth is 55% year over year and accelerating. And this is not even uncovering all the opportunities. Even with this rate of growth, we are still in the early stages, still a lot to unlock.”

Jumia China’s play is bearing financial benefits. Sourcing from China shortens Jumia’s cash conversion cycle, reducing capital tied up in inventory. Chinese sellers also allow Jumia to offer sharper prices and earn slightly higher take rates even as the average order value edges down to $35.3 from $37.6. 90 day repurchase rate was at 43.2% in Q2, 2025 from 39.1% in Q2, 2022. 

Chinese sellers are now Jumia’s most profitable thanks to scale, technical skill, and reliable supply.

‘Competing with Temu’

Jumia’s China bet comes just as Chinese platforms themselves aggressively enter African markets, forecasted to surpass half a billion ecommerce users by 2025.

Temu is blanketing the continent with marketing, discounts, subsidised shipping, and cheap goods that overlap some of Jumia’s categories.

Unlike Jumia, these platforms do not have to manage heavy last-mile networks or upcountry delivery. Their model is simple: bombard advertising channels with cheap goods directly sourced from China, offer discounts, and ship with the help of outsourced logistics partners.

Jumia, however, argues that its model is better suited to Africa’s logistics realities.

“We have been competing with Temu for at least a year and a half,” said Temidayo Ojo, head of Jumia Nigeria, during the investors’ day presentation. “About 60% of our general merchandise drivers are appliances and TVs. Temu cannot compete because of the size of the items. High-value phones and large or medium items cannot be drop-shipped cost-effectively from China.”

Jumia says its China hub allows it to match Temu on prices in categories like accessories and fashion. “We are able to match Temu on prices and supply. We can also deliver in 24 hours because many items are already in our fulfilment centres and warehouses in the countries that we operate,” Ojo said.

Temu still cannot offer payment on delivery, a crucial trust mechanism across African markets.

Hitting profitability

Jumia expects to break even before tax by Q4 2026 and reach full-year profitability in 2027. China sits at the centre of that plan, including Jumia’s 2030 GMV target of $2.5 billion to $3 billion.

“Assortment + Availability: scale China sourcing engine and deepen key categories,” Jumia said.

While Jumia insists its over 46,000 local sellers remain its backbone, the economics increasingly favour Chinese suppliers because of their scale, speed, and price points. However, this also raises the age-old question about product durability that hangs around cheap products.

Jumia turned to China to solve old problems, but in doing so, it may be opening the door to new ones.