Just a week after we got information on Ringier One Africa Media‘s plans to shut down BrighterMonday Rwanda and Cheki Tanzania, sources indicate the firm is letting go most of its staff in several markets across Africa as it reduces its active markets from 10 two years ago to just 3 by the end of this year.
According to our sources, Cheki Zimbabwe and Cheki Zambia will be closed at the end of the month and staff retrenchments will be announced in less than 48 hours as the firm struggles to move to profitability and run only Cheki Kenya, Cheki Nigeria and Cheki Ghana.
Though TechMoran is yet to receive clear information on the fate of Cheki Uganda, which is the fourth successful site after Cheki Nigeria, Cheki Kenya, Cheki Ghana; it will likely be shut down after its Tanzania sister site which is also facing the axe.
2 years ago, Cheki had over 10 country sites but at the moment, there are just 5 active sites left i.e Cheki Kenya, Cheki Nigeria, Cheki Uganda, Cheki Tanzania and Cheki Ghana. Instead of raising more cash to operate in all the ten markets, Ringier One Africa Media is making a sensible move to tackle a few major markets in Africa before it expands into new ones.
It also doesn’t make sense to scale all over without staff so markets such as in Zimbabwe and Zambia are the first to suffer this blow. With just Cheki operating in Kenya, Nigeria and Ghana, Ringier One Africa Media is able to monitor growth, turn its ventures into profit then sale to a bigger player or expand into new markets on budget. This is what happened to Rocket Internet with its many ventures in Africa. To reduce its total spend in Africa and earn substantial revenues, Rocket Internet decided to rebrand all its ventures to Jumia to cut costs such as branding, marketing among others. The firm recently sold its food delivery business foodpanda to DeliveryHero in Germany. To reduce its bulk and increase chances of Delivery Hero’s IPO. Rocket Internet owns a substantial stake in rival Delivery Hero.