Cash on Delivery COD
Cash on delivery lets your customer hand the money to the courier at the door instead of paying on the website when the order is placed.
Also known as COD pay on delivery cash on receipt
Definition
Cash on delivery means the customer pays the courier at the door rather than the website, and in Egypt that is still how most online orders are settled. Card payment has grown fast in Saudi Arabia and the Emirates. Even there, plenty of shoppers outside the big cities want to see the box before the money leaves their hand. For a new shop with no reputation, that removes the biggest reason a first order never happens.
It also hands the shop three problems a card payment does not have. The first is the invented order, because anyone can type a name and a phone number and nothing checks either one. The second is the refused order, from a real person who ordered and then changed their mind, or was asleep, or never had the cash. Fifteen to thirty percent refused is normal, and each one costs the delivery fee in both directions plus a product that has been travelling for a week.
The third problem is the money itself, which sits with the courier company for two or three weeks before it reaches your bank. That is how a shop can be busy and short of cash at the same time, and new sellers rarely plan for the gap.
Confirming before you ship removes most of the first two. On an expensive order a phone call still works best, because a human voice catches the hesitant buyer. For everything else, send a short code by SMS or WhatsApp and ask the customer to type it back into the site. It costs a few piastres and clears out most fake numbers at once. Linkysoft usually turns that check on for first-time buyers only, so regulars are not slowed down. Some shops also take a small deposit on costly items, and others stop offering the option to an address that has refused twice.
Then there is the counting, because every parcel carries an amount and the courier sends a settlement sheet that somebody has to match against your own records. You are hunting for the order that was delivered but never paid. Storek stores the collected amount on the order itself, so a sheet of four hundred parcels is checked in minutes instead of an afternoon. When Linkysoft builds this into a custom web application, the courier file is imported and the system shows only the rows that disagree. That short list is where the missing money usually is.
Questions about Cash on Delivery
Is cash on delivery safe for the shop?
How do I stop fake cash on delivery orders?
When does the courier company pay me?
Should I charge extra for cash on delivery?
What refusal rate should I expect?
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