Blow to e-commerce as OLX shuts its Kenya office

NAIROBI, KENYA: Over 30 employees will soon be out of work after online classified OLX confirmed it was shutting its Kenya office.

The e-commerce company will also close its Nigeria office, in what is a dent to the growth of e-commerce in Africa.

“We made a difficult but important decision in Kenya and Nigeria to consolidate our operations between some of our offices internationally,” said OLX Country Manager Peter Ndiang'ui.

Sources indicate that employees will begin receiving termination letters in March.

However, OLX says that the selling and buying of goods on its online platform will not be affected by the restructuring. “Our marketplace will continue to operate in Kenya and Nigeria - uninterrupted - as it has since 2010,” explained Ndiangui.

All of OLX’s operations in the continent will now be coordinated from South Africa office, as the company seeks to minimise losses.  Olx has struggled to spread its footprint in the two African markets.

In Kenya, besides the fact that e-commerce penetration has remained low with Kenyans still uptight about buying things online, cut-throat competition has also eaten into the small size of online shoppers.

Kenya has since played host to a number of e-commerce companies including Jumia, Kilimall and Safaricom’s Masoko which is the latest entrant.

OLX became popular among Kenyans as a free marketplace that enabled uninhibited buying and selling of anything, from an old black-and-white TV to the latest iPhone.

Abuse of this platform which at times turned into a thriving ground for fraudsters, saw the emergence of regulated marketplaces such as Jumia and Kilimall.

“We remain committed to the millions of Kenyans who use our platform to buy and sell every month. We continue to be focused on constantly innovating to make sure that OLX remains the top classifieds platform Kenya,” the statement by OLX went on.