When ordering various goods in online stores, you most likely saw the item “cash on delivery” in the list of delivery and payment options. What it is?
Definition
Cash on delivery is a type of payment in which the buyer receives the goods by mail only after they pay a certain amount to the employees of the department.
What is included in the amount of cash on delivery?
Those who have already dealt with this method of payment know that the final amount of declared value (that is, exactly the money that the buyer pays by mail) is slightly higher than the price of goods indicated in the online store catalog itself.
This is because the amount of cash on delivery, in addition to the actual cost of the goods, as a rule, also includes the costs associated with packing and forwarding the order.
In addition, each buyer pays a certain percentage of the declared value of the parcel in accordance with the tariffs of the mail itself - this money is needed so that subsequently the mail sends the sender the funds contributed by the buyer.
But, as they say, “the wolf is not as terrible as it is painted”: in addition to the main amount by mail, the buyer pays no more than 100-300 rubles (it all depends on the price of the product itself). Of course, it matters the fact how expensive the purchase is in itself, because basically everything is calculated as a percentage.
How to send goods cash on delivery?
This information will be useful for sellers who want to send goods using cash on delivery. What is this, you already know - it means that it is easy to imagine how approximately the sending procedure takes place.
First, the seller must inform about his intention to send the parcel to the postal workers. At the department, he receives a blank form of postal transfer, as well as 2 forms for processing the inventory (as if sending a valuable parcel).
The seller fills the postal order in his own name on behalf of the buyer. In addition to the estimated delivery price, the amount also needs to include 8% of the commission charged by the mail for the delivery of valuable parcels.
After the mail employee checks the documents, the mail transfer form is attached to the parcel. The seller is issued a postal receipt and an inventory certified by mail.
The buyer, in turn, can receive a purchase only after he pays for the goods - this is cash on delivery. Tariffs on both sides are quite small, but they must be taken into account so that the process of sending and delivery of the order goes smoothly.
Advantages and disadvantages of cash on delivery for buyers
The main advantage that cash on delivery has in this regard is a certain guarantee for the buyer. After all, you are not paying for some ephemeral product that you may not be able to send at all (many do not trust online stores for this reason), but for a package that is already in the department. As soon as you deposit the required amount, the shipment is transferred to you, that is, you receive your order. Therefore, cash on delivery is so popular that it is really beneficial for the buyer: you do not need to pay for the package immediately after placing the order - there is still a certain margin of time until the goods arrive by mail.
As for the shortcomings, first of all it is the need to overpay a certain amount, albeit a small one. In addition, you cannot inspect the contents of the parcel before payment. And if an unscrupulous seller forwarded to you not at all what you ordered, you can only contact the police.
Advantages and disadvantages of cash on delivery for sellers
If you send items by cash on delivery (or any other goods), you are guaranteed to receive payment for them.
Among the shortcomings, the risk that the customer simply does not take his order and the goods will be sent back to you should be noted first. And everything would be fine, but only sending by mail in itself takes a lot of time (from 3-5 days to several weeks). As a result, there is a risk of delayed turnover and, as a result, the online store incurs losses.
However, despite sometimes misunderstandings, many sellers are sure, choosing cash on delivery, that this is one of the most popular payment methods. There is no doubt - thousands of online stores successfully send products this way, and millions of customers are happy to pick up the long-awaited purchases from the post office.
We told you about the main risks, but it should be understood that risks are just possible situations that in practice arise very rarely.