UPS and Jumia partner on e-Commerce distribution network

United Parcel Service will use Africa-focused online marketplace Jumia Technologies AG’s distribution network to expand across the continent, helping the latter company’s stock price jump by 24.5%, according to a Bloomberg report.

The partnership gives UPS a stronger presence across Africa starting in Kenya, Morocco, and Nigeria at a time when online retail is surging and expected to continue to do so, Renzo Bravo, UPS’ head of strategy for the Indian subcontinent, Middle East, and Africa, declared.

“We believe that Africa has the potential to reach around $180 billion in online trade by 2025,” Bravo said. “That will enable growth and commerce, not only across Africa but also from the continent to the world and from the world to Africa.”

Jumia will have access to UPS’ network across 220 countries and territories to help users deliver their packages, according to Jumia senior vice president of logistics Apoorva Kumar. Neither Jumia nor UPS provided the financial terms of the deal. The companies are discussing plans to expand their partnership, including co-branded pickup stations.

Jumia, which was started in 2012, has about 8 million customers.

“With Jumia’s logistics business, we have managed to build up a fleet and delivery network on the continent that holds some value for an international courier giant like UPS,” Kumar said.

In November, Jumia Technologies highlighted signs of growth acceleration during its third-quarter earnings call.

“We have this vast, untapped market opportunity both on the eCommerce and payment fronts, and in this context, we really want to establish Jumia as the go-to destination for consumers, and we want to develop JumiaPay into a payment and FinTech champion on the continent over the next few quarters,”  Said Co-CEO Sacha Poignonnec said.

The pan-African e-commerce platform has also expanded the range of digital and financial services available to consumers. In Nigeria, customers can now book bus tickets via the JumiaPay app, while multiple new billers, including several universities, have been added to the platform in Egypt, allowing students to pay their tuition fees online through the app.