Copia layoffs in Kenya signal more disruption of B2C buying platforms

The Ugandan business only operated for about two years and was supposed to signal an Africa expansion strategy for Copia, which uses an agent-led business model to target consumers in rural and partly urbanised areas. It sells both grocery and non-food products.

In a statement supplied to the Kenyan tech news website, Techweez, Copia said: “Given that the economic downturn and the constrained capital markets are likely to continue for some time, Copia is optimising a number of key processes in its operations in Kenya to provide a better service to its customers and to drive sustained operating profitability.”

It added “This limited restructuring process is intended to ensure that during these economically challenging times, we will continue to focus our resources on the critical levers of business success and remain a lean and sustainable business for the long-term.”

According to Techweez, with the recent rounds of layoffs, Copia joins a list of other technology companies that have downsized due to the uncertain economic landscape in Kenya.

African e-commerce environment in a state of flux

In its most recent issue, (Issue 2 2023), Strategic Marketing for Africa, the magazine of the African Marketing Confederation, reported that Africa’s B2C e-commerce sector, with its ‘Amazon lookalikes’ and ‘Walmart lookalikes’, is in a state of flux.

“The early disruptors are themselves being disrupted by new challengers, changing economic circumstances, and greater competition from the bricks-and-mortar retailers, which are evolving into sophisticated multi-channel and omni-channel operations,” the magazine said.

“There is also the reality that the sector’s success is based on satisfying the middle-class consumer with a reasonable level of disposable income, or those consumers just below it. In many sub-Saharan African countries, that segment varies from moderate in size to wafer-thin – and is likely shrinking as the global inflationary trends and economic instability of 2022-23 hit home.”

In its analysis of the Copia layoffs, Trend Type, the London-based emerging markets consultancy, says they are a sign of pressure in the wider ecommerce funding space in African markets – but particularly in Kenya, which has the highest number of grocery buying platforms of any country in Africa. These include Twiga, Wasoko, Marketforce and Nigerian-headquartered Omnibiz.

“In Copia’s favour it exited Uganda early to focus on Kenya. Wasoko, meanwhile, has exited Senegal and Cote d’Ivoire but still stretches across Kenya, Rwanda, Tanzania, Uganda and now Zambia,” Trend Type says.

“Twiga continues to operate in Uganda. Marketforce operates in Kenya, Rwanda, Tanzania, Uganda and Nigeria. Omnibiz’s main market is Nigeria – Kenya is its expansion market.”