21 Comments

  1. Truly, COD orders lead to high returns and buyers give inane reasons. However, the suggestions to overcome this mess- shared herein – are truly enlivening. Thanks!

  2. hi
    we are 1 year old website with very compact 3000 product range and have constant orders flowing in because of the catalog and service we offer.
    we do not offer cod while we accommodate and encourage our customers in multiple other ways – allowing them to deposit a cheque in our bank account or even cash in a bank branch. apart from the usual payment gateway.
    our business is growing and customer base too. drop outs are not accounted for but guess we are satisfied with growth numbers.
    on the flip side, on market places, where we also sell, we were in last month (Dec Jan 2015 16) charged 4 times to 5 times more than the committed charges on cod. reason : increase in operational cost. also claimed wrong weights being charged by their courier partners. Our reaction : immediate increase in the price of every product by Rs. 150/-
    who looses at the end of the day…. customer (as our competitors will follow suit if not today , tomorrow to hold their profitability) and i feel we wont still loose the cod business as customers who do not have their cards / online banking account in place will know they have to top up their purchase with a extra charge.
    the ecommerce leaders in fact, should run a campaign to educate why cod should be opted. some websites also charge a cod fee to customer just to act as a deterrent.

    all in all, ecommerce or physical commerce, in long term rules are same. we need to give service, variety , quality at an economical value for money and brands will get business not the platforms. cod is part of the service. if cod hurts profits it will have to go or paid by someone………vendor, website or customer. and am sure vendor or website will not afford to pay.

    • Thanks for the insights Ravi. It’s always good to hear both sides from experienced sellers. The others can learn a thing or two from your experience and probably avoid facing the issues.

  3. Pramod Reply

    COD is a big nuisance to sellers like me. I sell mobile phones on Amazon and Flipkart. The margins in this business are extremely thin. In December, I had an un-delivered return (distinct from customer return) of 93% on Amazon and 88% on Flipkart (in value terms) in COD segment, whereas in prepaid segment, nearly all the items were delivered. One of the COD orders that I received had an address that read as “Namo Modi, Somewhere There, Andhra Pradesh”! And for not fulfilling such surely absurd orders, we are charged penalty.

    The marketplaces just pass on the orders without any verification of the customer. Two things can be done immediately to reduce this nonsense – 1. charging a premium for COD orders; and 2. reducing the value limit for COD orders (which for both these market places is 50K) to about 10K.

  4. i guess PayTm a bit ahead in this reducing COD transactions. for eg: if you are purchasing an item on Paytm Cashback is not available for COD orders and i mostly do online payments only.

  5. GOING CASHLESS ?

    Government is encouraging use of Credit / Debit cards , in order to reduce cash payments , which , currently account for nearly 80 % of all payments
    Measures ( Positive and Negative ), being considered / announced , include :
    * Elimination of transaction charges on purchases of Petrol , using Credit Cards
    * Income Tax benefits for individuals making payments thru Debit / Credit Cards
    * Disclosure of PAN for
    # cash transactions above Rs 2 Lakhs
    # settling hotel bills that exceed Rs 50,000
    # booking air tickets / tour packages , exceeding Rs 50,000
    # opening a bank account ( except for Jan Dhan Yojana a/c )
    * Incentives to shop keepers and traders to accept electronic payments

    While announcing these measures , revenue secretary , Shri Hasmukh Adhia said :

    ” …to collect information on certain types of transactions from third parties in a non-intrusive manner , the income-tax rules require quoting of PAN where the transactions exceed a specified limit ”

    Are we missing the woods for the tree ?

    What can be more ” non-intrusive ” than embedding Rs 500 / 1,000 currency notes with RFID micro-chips , thinner than a hair ? Each sensor, continuously broadcasting its location to the Income Tax Authorities , even as it moves from one hand to another ?
    And ” shouting from the rooftop ” each physical location, where there is an accumulation of Rs ONE CRORE worth of such notes !
    And assigning a UNIQUE Internet Protocol ( IP V 6.0 ) Address to each and every such high denomination currency notes ? – which could , even be its Currency Note Number ?

    Why bother to ” incentivize ” citizens to use electronic payments ?
    Why bother to introduce rules / regulations and make life difficult for everyone – including for those officers responsible for enforcement ?
    Just implement this and watch 90 % payments being made thru electronic means / devices , within 6 months !
    I had sent my above mentioned suggestion to Shri Arun Jaitleyji , when Govt had put out a paper ,
    ” Draft Proposals For Facilitating Electronic Transactions ” ,
    and sought public comments
    Implementing this does not require passing any bill in Rajya Sabha !
    If you have a better idea to dramatically reduce the menace of BLACK MONEY and CORRUPTION , in a single stroke , I request you to rush it to Shri Jaitley-ji , before 29 Feb 2016 ( Budget date ) at…
    * ‘ajaitley@del5.vsnl.net.in’ / ‘ajaitley@sansad.nic.in’
    Or , just forward this to him

    A recent news report spoke of printing of 30 Crore notes of Rs 1,000 denomination , WITHOUT that identifying silver thread

    Some of these defective notes even went into circulation ! Rest had to be destroyed

    This would never happen if a RFID micro-chip ( much thinner than that Silver thread ) were to be embedded in each note

    A Inspection device , costing no more than a few thousands of rupees and sitting on the Printing Line would immediately detect any note WITHOUT the RFID

    A bell will ring and a robotic arm would pick up and set aside such a defective note

    And if this was to happen to 10 notes in a row , the printing press will automatically shut down !

    This technology is already working in hundreds of factories around the World

    And embedding a RFID chip is much simpler than inserting that Silver thread !

    —————————————————————————————————-
    hemen parekh
    24 Jan 2016
    http://www.hemenparekh.in

  6. We Say1st are Sellers of Car Security Cameras and No Doubt the Only Returns we Receive back are for CoD Orders, in the same breath & to be extremely Honest, the biggest reason our Products have been listed on these Big Market Places like Amazon or FlipKart is that we directly cannot offer CoD which are better Handled by Big Players. Fact is we guide our Buyers wanting CoD to our Product Link at these Market Places.

    Lets Understand CoD as its here to stay

    From Buyers View Point

    Either the Buyer is Not having the Options of Electronic Payments
    OR
    The Buyer Does not Trust the Seller / Buying Process with a Electronic Pre Payment

    From Seller View Point

    Smaller Sellers Cannot Tie up with Couriers for CoD due to No Volume.

    “Branded” Products from a Long Standing Manufacturers can do away with CoD as there is No Need-To-See-Then-Will-Pay situation.

    Variable Pricing if Product Opted for CoD – Right Now its Variable Cost to Seller If Buyer Opts CoD.

    Sales and Marketing Compulsion will Decide Need for Cash-On-Delivery. Future can see some rationalization Product Wise, Region Wise, Brand Wise, Seller Wise etc. Agencies will come up to accumulate Data of Problematic Client who have Rejected CoD Deliveries / Unjustified Returns to Wash Order Data.

    1) No Doubt CoD Adds to Sales so and we Say1st love to have that option for now
    2) CoD is not slowing the eCommerce but adding to it, i myself as a 1st Time Buyers on different portals have Opted for CoD for purchases ranging from a Rs 300 Power Bank to a Rs 46k DSLR Lens. Once the Portal Passed the “Cash” Test then i had paid online.

  7. Thanks for an informative article. I wanted to share my experience from running an online business for 3 years. We took a decision to not offer COD from the very beginning, as we are in a niche product category (handloom sarees), and wanted to see if it is possible to build a business without COD. While we do get queries once in a while from folks who prefer COD, most of our customers are happy paying online. Even small businesses can build trust in a variety of ways, and we believe we’ve been quite successful with that. Today 35% of our orders comes from returning customers and our return rate is only 3%.

  8. Sanjib Reply

    Guys, I find this COD an interesting topic. Though it’s a challenge for all e-commerce players, but it’s a tool without which no-one can win customers’ trust. Atleast in India no e-retallers can say NO to COD. Well I think we can reduce such transactions through some innovative ways and get customer delight on each transaction.
    Time has come to think about rural mobile users who don’t use smartphones but they too wish to witness the unique online marketing experience. Someone had said it correct, “it’s (e-commerce) an ocean”.

  9. Great Discussion thanks for helping with good suggestions

  10. Anindya Roy Chowdhury Reply

    Its a great discussion took place here. Lights from different angle was focused on dynamic pros and cons of COD system.
    Unlike CEBIL we should try to make a COD customer’s profile database. Where they will be given ranking judging their past COD transactions. If their scores falls below a settled bench mark then he/she will not be able to order under COD system. This will give the cudtomers a sense of pride or a sense of degradating feelings about themselves. So their whimes will be in control and they will be more responsible.

  11. IMRAN HASHMI Reply

    Its a great discussion took place here. Lights from different angle was focused on dynamic pros and cons of COD system.
    Unlike CEBIL we should try to make a COD customer’s profile database. Where they will be given ranking judging their past COD transactions. If their scores falls below a settled bench mark then he/she will not be able to order under COD system. This will give the cudtomers a sense of pride or a sense of degradating feelings about themselves. So their whimes will be in control and they will be more responsible.

  12. Neha Verma Reply

    Shweta Singh,

    Good article, This is a well-researched article worth reading. In some terms, we can say COD is slowing Indian eCommerce. But its due to lack of trust in the product or in the website, which is gone years back. Now, most of the people use online payment. And I think only a few percentage of people opting for Cash on delivery due to many reasons. Here Makemyorders (https://www.makemyorders.com) another such online shopping website which offers multiple payment options.

  13. I am Merchant on Shopclue and Ebay and Flipkart by name of sonishopcom. SHOPCLUE:- I recieved 206 order in span of 45 days. we personally called and 144 orders got Cancelled as buyers didn’t had clue of any such order being made by them. we processed 62 orders in which 14 orders got EDD breach (New Terms) and the product was eligible for RTO. This EDD is something which courier company didnt deliver in time.(Istn that great shopclue make themself look like angel and fucks merchant like us.) Why is Said EDD as new term because they keep inventing new term evey month eg OSLA , SCC, bla bla. Back to Topic:- yeah so 62-14 Order = 48 Order, Out of those 22 order again RTO even after calling COD buyers. So 20 Orders Eligible for payment. As i am premium seller i should get payment on delivery, BUT !! i got this 20 unit payment in installment within 2 month and that two after numerous escalation and Shopclue humiliation on its network site. these RTO orders 22 of them i got only 13 and balance i am still waiting for past 45 days.

    So this COD stuff need to be stopped. This is curse and These e-Commerce site make their name at cost of merchant like us. We face all kind of damages like lost goods, damage goods, packing damage, delay payment, mindless order by customer, etc. all these fuss only because buyer have nothing to loose because its COD orders.

    In past 8 months i had made financial loss of more than 25Lakhs due to damages lost goods and over inventory, delay in payments etc.

    So the hell with them and hell with COD.
    So i had planned to sell through my own website that is sonishop.com

  14. Sushil Kokate Reply

    There is still lack of trust to use online payments while purchasing online. Myself has experienced instances where items purchased using online payments are most of time delayed by the sellers/delivery boys/shipping company etc. While COD items generally reach within time. From article I understood why COD items delivered within time – just to save additional expense of shipping, warehouses, etc.

    So this seller’s mentality of “chalta hai – payment is done already” also cause us to use COD payments instead of online.

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