What are the challenges that makes it difficult for online businesses to offer payment on delivery options?

[Min George]

Many local online businesses are still yet to implement payment on delivery to their customers. It seems that there are obvious challenges that makes payment on delivery option not to be feasible for online businesses. What are those likely challenges with payment on delivery?

 

[gwolf666]

Cash on delivery can be a convenient option for customers, but it also presents several challenges for online businesses. One of the main problems is the risk of non-payment, as some customers may accept the product but then fail to pay, impacting the business's finances. Furthermore, there's the issue of logistics and additional costs, since managing deliveries solely for cash payments can complicate and increase the shipping process. There's also the difficulty of verifying the customer's identity at the time of delivery, which can open the door to fraud. Finally, in some places, digital payment options are growing, making cash on delivery less necessary and therefore less attractive for businesses. In short, while it can increase customer trust, the associated risks and costs are often significant obstacles to implementing this payment method for online businesses.

 

[Kross]

When the customer rejects the product, it is the business that runs at a loss having already paid transportation to deliver.

 

[Nomad]

One main reason is return of the product, another reason is not being able to find customers address. Sometimes they even play pranks

 

[Springtime]

I think one main challenge is if the customer rejects the product upon delivery, the online business cannot receive money but they have already paid the cost of the product and transportation.

 

[Augusta]

Balancing the cost of providing instant payments with the value it brings to the business is a significant challenge.

 

[eLdavis]

One difficulties they go through is high return rates, the company would run on looses if they keep returning the products.

 

[Augusta]

COD poses a higher risk of delivery refusal and incurs return costs for businesses. Buyers may struggle to return items purchased via COD

 

[Nomad]

When the customer does not collect the product, your spending on delivery will go wasted, this is also a big challenge.

 

[Augusta]

One is the risk of non-payment, as some customers may accept the product but then fail to pay when they are delivered

 

[Starmix]

Customers are wise this time after a series of scams online. So, before they pay for the order delivered by the courier, they have to check the contents first before paying. I experienced this, I ordered a branded shoes, but delivered to me was a box containing bottles. So, I did not pay for the order. it was returned to the online seller- scammer.

 

[Min George]

When the customer does not collect the product, your spending on delivery will go wasted, this is also a big challenge.

It is the is the primary challenge that discourages online vendors to accept payment on delivery. Only very big online businesses that ship in bulk would be able to offer payment on delivery without feeling the effect of this.

 

[Augusta]

The costs associated with POD, including cash handling and higher return rates, can be substantial.