Is now the time for e-commerce in Africa?
While short-term trends have indicated increased investor appetite for the e-commerce space in Africa, it is still a fairly nascent industry. Despite the headline grabbing progress made by Jumia in 2019, it is worth reflecting that they also announced that they are pulling out of certain geographies (such as Côte d’Ivoire) in Q1 2020.
E-commerce, particularly B2C online retail, relies on the repeat services of tech-savvy customers. Challenges with infrastructure such as congestion will have an impact on the service provided to online retail customers, but perhaps the real challenge to wholesale adoption is how to service more rural customers in a cost-effective way. This is where the e-commerce and online retail sector has an opportunity to innovate and perhaps partner with companies offering supply chain-management and smart delivery services.
The coronavirus (COVID-19) pandemic is forcing us to rethink our habits and preferences, and perhaps out of necessity is causing consumers to seek out retail options that they previously have not considered. It is too soon to tell if any change in customer behaviour is permanent, but e-commerce companies currently have an ideal opportunity to capitalise upon this change.
The Baobab Network
Based in Nairobi, The Baobab Network is Africa’s leading start-up accelerator, providing early stage technology companies across the African continent with funding, support and a global, platform to scale their businesses. In the last three years, VCs in Europe, Asia, the US, and Africa have invested follow-on capital into Baobab portfolio companies. Baobab also works closely with corporate partners around the world that partner with their accelerator for research, innovation, and access to new technologies in Africa.