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Jumia plans to invest $20m in the Egyptian market in 2015: Executive Director - Daily News Egypt

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Jumia plans to invest $20m in the Egyptian market in 2015: Executive Director

Our investment amount in the African market during 2015-03-10, says Hesham Safwat

Hesham Safwat, the company`s Executive Director in Egypt
Hesham Safwat, the company`s Executive Director in Egypt

By Mohamed Alaa

Jumia Company, specialised in e-commerce, is planning to pump $20m in the Egyptian market, this year.

This is part of its $80m investments in the African continent during 2015, according to Hesham Safwat, the company`s Executive Director in Egypt.

During his interview with Daily News Egypt, he added that the company will concentrate on improving its logistic services in Egypt in the next period. Thus, five new logistic centres will be opened this year in Sharm El-Sheikh, Hurghada, Assiut, Mansoura and Alexandria.

How do you view the e-commerce market in Egypt? 

According to the last statistics, the percentage of the people who intend to purchase through internet is between 5% and 7% from the total percentage of internet users. On the other hand, the rate of development, concerning acquisitions through the internet, and its users, increase steadily, to the extent that it reaches 300%.

As for the actual indicators and rates, we expect that the online share will witness huge growth, next period, thus, it will reach between 10% and 12% from the total percentage of the internet users. If we compare the Egyptian market with the European one, we will find that the percentage in the latter reaches between 12% and 14% of the total amount of Internet users, while the percentage increases to 18% in the USA.

The Egyptian market is promising when it comes to e-commerce, due to the development of the percentage of internet users that reaches almost 40%, which increases the opportunities for development during the next period and the increase of the e-commerce users’ share, compared to the number of internet clients.

What are the challenges that face the local e-commerce market?

It is neither easy nor simple to convince production and industrial companies to present their products through e-commerce. This is a big challenge that the Egyptian market faces, in addition to the difficulty of convincing new clients of acquisitions by the mean of the Internet. Also, we should remember the services provided by “call centre-shipping product”. This is the challenge that we focus on, aiming for its disappearance in the next period, especially as the past periods witnessed many clients’ complaints regarding services.

Attracting new clients requires at least one successful experience, and hence, a massive number of people would be addicted to purchasing via internet, aiming to achieve this. Starting from the second quarter of the current year, we will provide a new service called “The First Client”. This service will be special, in other words, we will provide the customer a good purchase experience via internet, which will guarantee their conversion to permanent clients.

The absence of organised legislations and laws that manage the e-commerce industry is the most important challenge that we face in the Egyptian market. From this end, the Ministry of Communications announced the process of preparing legal legislations that will organise the e-commerce industry, based on its strategy.

What stimulates Jumia’s rapid growth in the Egyptian market?

Jumia is one of the investment arms of Rocket internet group, a German company with huge investments in the internet field, which reflects the level of service and the size of investments in the Egyptian market and Africa, which positively impacts growth.

Additionally, there are many growth opportunities in e-commerce in the Egyptian market, thanks to growth opportunities on the scale of the number of Internet users as well as that of e-commerce activity. This rapid growth is reflected in the number of Internet users over the past four years locally, and the increase of Egyptians’ Facebook accounts.

What is the size of investment planned to be pumped into the Egyptian market?

We have allocated $80m for investments in the African market this year, of which the Egyptian market gets $18m to $20m.

Where will these investments be pumped?

We aim to pump investments into improving our own logistics infrastructure to improve the system of delivery of orders to customers, in addition to improving the call centre service level, as good purchase experiences guarantee that customers becomes regular.

How will you improve your charging service?

We will conduct the charging and delivery ourselves, without depending on specialised shipping companies, as we have founded a department in the company specialised in this area. Also, we are currently working on establishing logistics centres to reach customers faster, in addition to automation of all the steps of the charging process and following up on it moment by moment.

We aim for the number of employees in this department to reach 250 persons, between drivers, quality supervisors, and other jobs.

What are your plans for setting up logistics service centres?

We currently have two logistics service centres in Maadi and Mohandessin, and we aim to open new centres in Sharm El Sheikh, Hurghada, Assiut, Mansoura, and Alexandria.

There are pages on Facebook conducting sales online. Do you consider them competitors?

Honestly, they are illegitimate competitors and they harm the whole e-commerce market, as they give the customer a negative experience in online purchase, which loses the market a potential customer. That’s why urgent measures should be taken in issuing laws and legislations organising e-commerce activities.

What are your latest products expected in the upcoming period?

We are trying to keep up with events, and we offer the latest types of products, especially in the field of technology. That’s why we have agreed with Samsung to sell their Galaxy 6s devices, which will be available in a few days on our website.

What’s your competitive advantage?

The level and quality of service, international products, and brands we offer on our website are among our competitive advantages. Also, our 12 year presence in the African market, including Egypt, gives our customers confidence in us and guarantees us significant loyalty from our customers.

How many products are you offering?

More than 60,000 products are offered on our website so far.

How many customers do you have?

We have more than 100,000 customers so far.

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