Yesterday, Jumia Uganda unveiled its second and newest warehouse to the media for the first time. This was at a press conference to launch Jumia’s looming sixth-anniversary celebration. The celebrations will comprise two weeks of discounted products.
“In commemoration of its sixth anniversary, Jumia is holding a mega birthday sale that will see customers get up to 75% discount off on items starting Monday 16th July 2018 until 26th July 2018,” the company wrote in a press release.
Located on the 5th street industrial area – besides the Bata Store – the warehouse covers over 1000 square meters. That’s according to Ham Namakajjo, Jumia Uganda’s Country Manager.
The warehouse is almost 5x the size of their first one – located on Lumumba Avenue – at Jumia’s main office in Uganda. Ham said that the decision to get another facility was based on the desire to achieve efficiency in their operations.
“If you ordered a mattress right now [at mid-day], we would deliver it before the end of the day because it is before 2 pm. If you order past 2 pm, then you’ll get it tomorrow.”
He says that’s possible because they already have the consignment from their vendors in the warehouse.
Normally, Jumia delivers within 3 to 6 days. Though, they had introduced a Jumia Express option that allows one to receive their package within 24 hours of placing the order. “Our normal delivery promises sort of 3-6 days,” said Ham.
But, with the new facility, he believes both Jumia Express and the normal delivery program have received a boost.
“There are two modes of delivery we have at Jumia. There’s the regular marketplace delivery and then we have Jumia Express. Jumia Express means we are able to turn around the product within 24 hours.”
Some e-commerce players like Konga charge[d] their vendors a “small fee” to allow them to keep their products in their warehouse. In the process, they make their fulfillment process more efficient, earn extra revenue from the facility as well as save their vendors from paying exorbitant rental fees. Something I thought Jumia was also after.
But, Ham says their motive is not revenue driven and are not looking to make any revenue from the facility. At least in the short run.
“Right now we are not charging for it,” Ham pointed out. Adding that “right now we are more focused on being efficient internally than actually raising revenue from the warehouse.”
“It is more about ‘can we get these things as fast as possible to the buyers'”
Apart from Jumia, there’s another venture in Jumia Group – Jumia Party – that requires fulfillment. It currently runs – together with Jumia Fresh, under Jumia Food. Yet, unlike Jumia Food and Jumia Fresh, Jumia Party – which handles alcohol and other party flavors – maintains a fulfillment center.
The service is currently being outsourced to Pink Tie, a logistics and partly e-commerce company based in Naguru.
Pink Tie, the company that carries out deliveries for KFC, Pizza Hut, Jumia Food and also runs the Kilimall venture in Uganda, is currently in charge of the entire Jumia Party stocking its products and delivery.
Though my guess was that after Jumia Group – through Jumia – acquiring a bigger facility, which is currently underutilized, they would look to stop outsourcing for the Jumia Party service. According to Ham, that’s not the case.
“Jumia Party is a little different,” he said. Adding that “they have a facility [which is] a little smaller than this where they also have their goods consignment – the alcohol and the party flavors.”
“Theirs is a much much faster thing because we have to deliver within an hour. The mode of delivery is somewhat different. So we are going to keep it the way it is. Because Jumia party is working [the way it is] right now.”
Though he also acknowledged that as the scale of operation for the venture increases, they might revisit their plans and “make the determination on whether to expand or not.”
According to one of the staff I spoke to, the new warehouse has been in operation for at least 3 months. Though not yet fully utilized to the maximum capacity, Ham pointed out that by close of the year, they hope to occupy it to the maximum.
Currently, Jumia maintains three facilities for their storage and logistical works. The new warehouse in the industrial area, the pickup location at The Cube in Kisementi and their old warehouse on Lumumba Avenue.
Though, they also signed a partnership with Posta Uganda which granted them an opportunity to use Posta Uganda offices across the country as pick up locations for their customers.
For deliveries, aside from an in-house team, they still maintain ties with DHL, Aramex, Skynet and Pink Tie.
You can watch the tour [00:32:10] of the warehouse and the entire press conference in the Facebook Video below