Why Amazon May Acquire Jumia, Konga, Others in Nigeria

By Tolulope Oke

American e-commerce giant, Amazon has announced to commence operations in Nigeria in April 2023. 

While keeping its U.S. base, the corporation will spread to five new nations in Africa, Europe, and South America. Belgium, Chile, Colombia, Nigeria, and South Africa are the five nations.

As a result of this development, e-commerce websites like Jumia, Konga, and Takealot would face intense competition.

Amazon currently operates in 20 nations and has expansion aspirations for its main market, the United States.

In February 2023, Project Fela, code-named South Africa, is also scheduled to debut. The market in Nigeria is scheduled to open in April 2023.

The documents state that each nation plans to create its own marketplace and make use of Fulfillment by Amazon, Amazon’s fulfillment service.

BusinessDay reported that Stanley Awelewa, Advanced seller key account manager at Jumia explained that Amazon is a significant competitor with a sizable budget, its introduction into the market will undoubtedly disrupt all current companies because they will be forced to compete.

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As a matter of fact, Amazon might even purchase some of the companies.

In his words, “Amazon is a big player with a very big budget so their market entry will definitely disrupt all existing players as they will need to step up. Some may be acquired by Amazon.”

Moreso, Amazon’s revenue for the quarter ending March 31, 2022, was $116.444 billion, a 7.3 percent increase year over year. Amazon revenue for the twelve months ending March 31, 2022, was $477.748 billion, a 13.99 percent increase year over year.

Amazon’s annual revenue for 2021 was $469.822 billion, a 21.7% increase from 2020. Amazon’s annual revenue for 2020 was $386.064 billion, a 37.62% increase from 2019 according to macrotrend.

Thus, it is clear that Amazon’s entry into the country will put some businesses under pressure, and every iota of purchasing Jumia and others is clearly possible.