• French retailer Leroy Merlin will see its products sold in rural areas in Cote d’Ivoire and Senegal via Jumia’s ecommerce model.
• Jumia says that it has seen high demand for Leroy Merlin products in these areas, which contain most of Africa’s population, according to its CEO.
• The deal with Leroy Merlin is part of Jumia’s latest plan to cut costs by 50 percent before 2024.

French tools and DIY products retailer Leroy Merlin will begin selling its stock in rural areas in a few West African countries thanks to African ecommerce giant Jumia.

The deal struck between the two companies will see Leroy Merlin enter francophone Cote d’Ivoire and Senegal via Jumia’s ecommerce portal. According to Bloomberg, Jumia has started focusing on high-growth rural areas and smaller cities across Africa.

Its CEO Francis Dufay indicated that more than half of Africa’s 1.4 billion population live outside big cities, in smaller rural towns and villages. Dufay believes these areas have a high demand for the kind of products that Leroy Merlin sells.

“Jumia is pushing into these areas, we have the right suppliers and assortment of products, and a light logistics model to address those smaller pool of consumers,” explained Dufay.

“This would be much harder to do for bigger supermarkets and shops for instance.”

In terms of its logistics to reach these areas, Jumia, often called “the Amazon of Africa,” has been investing in and testing drone-powered deliveries. Its latest collaboration with delivery service Zipline saw its pilot programme fly on-demand deliveries to customers in Ghana last year.

In South Africa, Leroy Merlin sells a wide array of products, from solar geysers to appliances, to bedroom furniture, tiling, power tools, and even gadgets.

Through Jumia’s ecommerce model, Leroy Merlin is able to provide products for these regions without having to build brick-and-mortar shops.

And it seems that there is demand for the French retailer’s products in these areas, with Jumia declaring that in pilots almost 40 percent of Leroy Merlin goods available in the two countries sold to customers outside of Ivorian economic hub Abidjan.

Jumia, once Africa’s first unicorn startup out of Nigeria, is hoping to cuts its losses by 50 percent by the end of the year. It is hedging its bets on rural markets across the continent, of which the deal with Leroy Merlin plays a part in.

Dufay, who took over the reigns of the company from its founders last year, claims that expanding to smaller cities requires a fraction of the capital it takes to head to Africa’s economic hubs.

“While we are facing big headwinds, we are building these new markets in smaller cities, and plan to drive margins with that,” Dufay said.

Jumia is apparently considering taking this model to small towns in Kenya, Nigeria and Ghana soon.