Connecting market vendors to online consumers with Jumia Food
The pandemic-driven restrictions on trade, movement, and other activities starting in 2020 affected a large portion of the Ugandan business community. Lower-income earners such as market vendors were particularly hard hit by these lockdowns.
While e-commerce seemed like the next logical alternative for many of these aspiring entrepreneurs, the reality proved to be much more difficult as they often lacked the funds to purchase a smartphone and maintain a consistent data plan. Furthermore, even those market vendors who were fortunate enough to have a smartphone and data plan often fell short of the tech-savviness required to use e-commerce platforms such as Jumia. In response to this challenge, Jumia and UNDP decided to join forces to support these vendors by helping them access e-commerce.
Jumia joins hands with United Nations Development Program (UNDP) to support market vendors
In March 2020, Jumia initiated discussions with UNDP through its Accelerator Lab, with a focus on solutions supporting the informal sector. At the time, Jumia Food already had a grocery option on its platform.
The Accelerator Lab presented an ideal solution towards the support to the market vendors, who are part of the demographic that UNDP wants to assist. Jumia was working primarily with the Nakasero market in Kampala. We shared data about the performance of this offering in a bid to get help in scaling the entire operation.
The result is a partnership with UNDP that is underpinned largely by adding more market vendors online, supported by the Jumia Food vendor app. The basic idea behind this is to connect more market vendors to consumers so they may continue selling groceries whilst complying with COVID-19 guidelines.
How the solution works
We started by deploying market agents to train sellers on how to participate in the e-commerce ecosystem. These market agents also aggregate the vendors and all of the product information into clusters, with one agent representing as many as 50 sellers with an assortment of different products.
From a process standpoint, the market agent receives an order placed by a customer, then selects and purchases products that meet the standard, with the help of a picker. These products are then organized and packaged in a bundle according to the order information before being passed on to the delivery agent.
The market agents are given a float to enable them to settle payments to sellers instantly, and this float is replenished weekly. Jumia relies on both consumer order data, data from the market agent side, and other information such as market-specific pricing and geographical location to anticipate order volume trends.
Thanks to a robust order management system, Jumia is able to maintain clarity on the near-term float demands of market agents in various markets. Subsequently, it is able to ensure that each vendor is paid on time.
UNDP provides support in the form of market agent training, airtime and data, and additional technical support where offline and online components meet. Jumia collaborates closely with Kampala Capital City Authority (KCCA) to ensure that all efforts are harmonized with its management goals and other stipulations regarding the vendors.
The partnership performance so far
To date, the partnership has supported approximately 2000 market vendors with 60% of them being women, during the first six months. The initiative eventually covered additional major markets like Bugolobi, Wandegeya, Nakawa, Ntinda, Naalya, Kalerwe, Owino, Entebbe market and others.
So far,feedback has been amazing from the market vendors. Kisakye Joyce, a Nakasero market vendor, lauds Jumia’s large daily order volumes and instant cash settlement of vendor earnings. Nantale Grace, another Nakasero market vendor, commends the initiative for helping them to reach more consumers in Uganda and to grow their businesses due to increased sales.
The benefits of the digital markets initiative
Jumia’s team has enabled market sellers to reach a larger number of online shoppers who buy groceries in bulk. This translates into higher revenues, with some vendors seeing up to UGX 200,000 more in sales (around 60 USD).
Market vendors are also able to diversify their product offering thanks to the consistent and timely settlement of their earnings by the market agents. They can reach out to other suppliers knowing that they’ll have customers to which they can sell these other products.
Shoppers also avoid the hassle of moving from vendor to vendor looking for quality products. And more importantly, both buyers and sellers can transact without increasing the risk of spreading the coronavirus.
UNDP has also supported the market vendors through equitable financing, which has enabled them to grow their assortment exponentially, to meet the current online demand. These vendors have also been trained on financial management and harnessing digital skills.
Jumia is working to expand this initiative and continue offering safe and convenient e-commerce solutions that include entrepreneurs from various income brackets and sectors.
Head of Offline Sales - Jumia Uganda
Timothy is an ambitious tech enthusiast with over 8 years of experience in e-commerce Business Management. He is passionate about digital transformation of businesses and serial entrepreneurship. He is a Chartered Accountant and graduated from Makerere University in Uganda with a Bachelor's Degree in Business Administration. He joined Jumia Uganda in 2014.