Africa’s E-Commerce at a Crossroads

Africa’s leading online marketplaces — Jumia, Takealot, and Konga — are navigating an increasingly competitive and resource-constrained environment. The early euphoria surrounding Africa’s “e-commerce revolution” has given way to sobering realities: low internet penetration in rural areas, logistical bottlenecks, patchy infrastructure, and widespread consumer mistrust of online payments have forced platforms to adapt — or risk fading away.

So, what strategies are keeping these marketplaces afloat?

1. Refocusing on Core Markets

After years of aggressive pan-African expansion, the major players are scaling back to concentrate on markets where they can realistically achieve profitability or build sustainable scale.

Jumia, for example, exited several markets — including South Africa and Tunisia in late 2024 — to focus on stronger bases such as Nigeria, Kenya, Egypt, and Morocco. These regions boast larger urban populations, more reliable logistics networks, and more developed digital payment ecosystems.

This “shrink-to-grow” strategy reflects the insight that trying to serve all 54 African countries — with their widely varying levels of readiness — merely spreads resources too thin and leaves companies vulnerable to nimble, localised competitors.

2. Logistics Investment: Tackling the Delivery Challenge

Delivery remains one of Africa’s greatest obstacles to e-commerce growth. Poor roads, congested cities, and a lack of reliable postal systems make getting goods to customers both slow and costly.

Konga (Nigeria) has invested heavily in building its own logistics and warehousing network, ensuring greater control over delivery and reducing customer complaints about delays or losses.

Takealot (South Africa), meanwhile, has focused on automation and “dark stores” — local fulfilment hubs situated closer to customers — which speed up deliveries and lower costs.

Both platforms are experimenting with “personal shopper” models to serve underserved areas such as townships and peri-urban communities. This hybrid approach combines the convenience of digital shopping with the trust and familiarity of human interaction.

Payment Solutions: Building Trust Takes Time

One of African e-commerce’s perennial challenges is the low level of trust in online payments — compounded by low credit card penetration. Many consumers remain reluctant to pay for goods they cannot see upfront, and millions lack access to formal banking.

To overcome these barriers:

Cash-on-delivery remains widespread, despite being more expensive for retailers.
Partnerships with mobile-money providers (such as M-Pesa) have made payments more accessible for unbanked customers.
Some platforms are introducing Buy Now, Pay Later (BNPL) options, enabling customers to receive goods immediately and pay in instalments.

Niche Platforms and Specialisation

While the big players chase scale, a new wave of smaller, specialist marketplaces is emerging. These focus on specific sectors — such as fashion, gaming, or artisanal goods — and are proving more resilient, thanks to reduced price competition and stronger brand loyalty.

For example:

Local fashion and craft marketplaces cater to consumers seeking unique, locally produced items not found on the major platforms.
Gaming-focused sites offer consoles, accessories, and payment plans that resonate with a younger, tech-savvy demographic.

These leaner models can thrive in smaller markets, unburdened by the overheads of large, generalist rivals.

E-Commerce for Informal Retailers: The B2B Opportunity

Beyond the well-known B2C giants, another vital segment of African e-commerce serves tBeyond the well-known B2C giants, another vital segment of African e-commerce serves the informal retail sector — the countless small, independent shops, kiosks, and spaza shops that remain the backbone of African retail.

Here, platforms such as Wasoko (formerly Sokowatch) and TradeDepot have pioneered digital B2B marketplaces, helping informal shopkeepers restock more efficiently while accessing credit and delivery services.

Wasoko, operating across East and West Africa, delivers fast-moving consumer goods directly to informal retailers, alongside short-term credit. At its peak, Wasoko operated in several countries including Kenya, Tanzania, Rwanda, Uganda, Côte d’Ivoire, and Senegal. However, amid mounting losses and investor pressure, Wasoko began scaling back in 2024 — shutting down operations in Uganda, Zambia, Senegal, Côte d’Ivoire and even Zanzibar, and significantly reducing its workforce. That same year, it announced a merger with Egyptian B2B player MaxAB, consolidating their operations to focus on core markets and a clearer path to profitability.
TradeDepot, based in Nigeria and Ghana, has remained independent and continues to grow steadily by offering stock aggregation, BNPL financing for shopkeepers, and real-time analytics to help suppliers better target demand.

These platforms address three key pain points for informal retailers:
✅ Expensive and time-consuming restocking trips.
✅ Unpredictable pricing and stock shortages.
✅ Lack of working capital and formal credit access.

While the unit economics remain challenging, especially in less dense markets, the B2B segment still holds significant promise — not by replacing informal retail, but by empowering it. The Wasoko–MaxAB merger highlights a growing trend of consolidation in the sector as companies seek scale and sustainability through partnership rather than overextension.

Growth vs. Profitability: A Delicate Balance

Despite the fact that few African marketplaces have yet achieved sustained profitability, investors continue to back them — drawn by the promise of a growing middle class and vast untapped potential.

Jumia has endured years of losses, but continues to attract backing from shareholders who hope that scale will eventually yield profits.

Takealot remains in growth mode, reinvesting in infrastructure and extending its reach, betting that market dominance will pay off in the long term.

Wasoko and TradeDepot illustrate the same tension: significant investor support, tempered by rising pressure to deliver clearer paths to profitability — especially after Wasoko’s market exits and merger in 2024.

This phase can best be described as pragmatic optimism: an acknowledgement that profitability may take longer than initially hoped, but confidence in the fundamentals remains.

What Does the Future Hold?

E-commerce in Africa has matured significantly since its initial boom a decade ago. Retailers now better understand which geographies and customer segments are viable — and which are not — and are adjusting accordingly. Over the coming years, expect to see:

Further consolidation and market exits.
Greater investment in logistics technology and localised delivery models.
A sharper focus on payment innovations and trust-building initiatives.
Heightened competition from global entrants such as Amazon and fast-growing Chinese platforms like Temu.
More B2B–informal retail integration, as Wasoko, TradeDepot, and others refine their models to serve Africa’s informal economy more profitably.

For now, African marketplaces — both B2C and B2B — are learning that “being everywhere” is not sustainable — but being better where it matters is.