COD is the acronym for Cash On Delivery, a viable dropshipping alternative to the ordinary way of online vending products.
In this post, you will find out if Shopify supports a cash-on-delivery business model.
You’re aware of the dropshipping setup, in which you’ll not have to maintain an inventory.
You can locate a dependable supplier with a moving product, market the item, and have the supplier fulfill your customers’ orders.
With this standard dropshipping model, you do not have complete control of your merchandise.
But that isn’t the situation with COD dropshipping. You’ll have to invest in the merchandise upfront, handle the shipment yourself, and then get paid when the customer receives the product, usually 2-5 days later.
So, it would help if you mainly located suppliers that are integrating COD in their dropshipping business model.
You don’t have to worry about finding suppliers that incorporate COD. In this article, we’ll introduce one before signing out.
Table of Contents
COD-Cash On Delivery Dropshipping
Before we dive deeper, the following is a summary of what this article will discuss, thus giving you a heads-up.
- What’s COD?
- How COD works in dropshipping
- Merits of COD.
- Drawbacks of COD.
- COD dropshipping platform.
- What are COD elements?
- How to start Cash On Delivery using Genie Funnel
What’s COD?
COD, or Cash On Delivery, is a method of selling items online in which payment is made on delivery instead of in advance. It is sometimes referred to as Collect-on-Delivery.
If the product sent out is not paid for, it is automatically returned to the retailer or seller.
Initially, the term COD was solely applied to cash payments; however, other kinds of payment have become more common over the years.
Accordingly, the word ‘Collect’ over the period has replaced the word ‘Cash’ to rope in the transaction by checks, debit cards, and credit cards.
And because buyers do not have to pay for products they have not yet seen, COD is making a significant contribution to making e-commerce safe.
While the model has made it safer for buyers, the same cannot be said for sellers. The COD payment method is susceptible to product returns, which spells doom for the business.
The Emergence of COD
Like other e-commerce transactions, this kind of payment for online purchases is identical, save for COD, where buyers only pay once they get the product.
This way, the customer is more assured, and as for the merchants, sales figures are higher.
Imagine You live in Dubai, UAE, and want to shave your beard at home without the barber’s service.
You stumble across an ad online for a remarkable electric razor and do not like using your credit card online.
Hence, you choose to pay once you receive the product. You see the product first before making payment, so you receive your order faster and pay in cash.
Later in this article, we’ll examine the merits and demerits of COD, though that’s after we’ve examined how COD can integrate into dropshipping.
How COD Works In Dropshipping
It won’t work at all, looking at it. The usual way of doing dropshipping entails finding a supplier with whom you work to drop ship their products.
This means that the suppliers are ready and willing to fulfill all the orders you send after you’ve earned your profit margin.
Oops! I’m moving too fast. If you are new to dropshipping, let’s quickly go over how this business setup operates.
What’s Dropshipping?
Dropshipping is a retail fulfillment business model in which an online store does not stock merchandise; it vends it.
Instead, in the place of an inventory, you showcase the photos of the product.
Whenever you sell a product, you order it from a supplier or a third-party seller who handles the product shipment and packaging.
In other words, dropshipping implies that you’ll not directly handle or see the product.
The bulk of the work vests on the shoulders of the suppliers of the third-party sellers
COD+Dropshipping
Assuming that you’ve grasped how dropshipping works, let’s discuss integrating COD into the business model.
Incorporating COD into dropshipping seems challenging given that many products drop shipped are sourced from China-AliExpress, which doesn’t allow COD on its platform.
To make COD plus dropshipping functional, you’ll need a reliable local supplier who sanctions dropshipping and can readily fulfill the order on your behalf.
Also, the supplier should agree to receive payment after making the delivery and remit your proceeds upon getting cash from your customers.
Your income is the difference between your store’s and supplier’s prices. This means you have the leeway to set your online store’s prices.
Merits of COD
In this section, we’ll discuss the advantages of Cash On Delivery and ways to increase your store conversion.
(1). The ultimate choice for customers
Since buyers must see the products ordered before paying, cash on delivery is thus the most preferred model.
Customers’ payment details, such as debit or credit cards, are also protected when they make payment for the products.
Your online store will experience an upsurge in conversion as folks see your items or ads on cash on delivery.
(2). It Animate Impulse buying
Among the benefits of cash on delivery is that it inspires impulse purchases since many of your customers buying your merchandise may not have intended to buy in the first place.
However, they become more interested and eager to purchase when they see tour product ads and spot payment on delivery.
The fact that they do not have to pay promptly triggers customers’ buying impulses, subsequently increasing sales and conversion rates.
(3). It Boosts the Client’s Conviction On the Seller
Also, customers tend to trust more sellers who offer cash on delivery than those with prepaid models.
Instead of committing to payment under the probability of supposed genuine products or seeing the item, customers feel safe buying from stores with incorporated COD as they know what they order before paying.
These aspects motivate customers to choose cash on delivery, boosting your store’s conversion.
(4). It Dissuades Vending Of Fake Products
As a vendor, this setup discourages you from selling counterfeit or inferior goods because you know buyers will reject the products.
And so the issue of low-quality and return product out of the equation, buyers and sellers automatically stand to reap.
Again, because of the value gained, both the seller and the buyer relish the transaction’s experience.
(5). Return On Investment-ROI
The model permits you to mine from some product markets where the purchase or the cost per conversion is low compared to competitive markets.
This allows you to make a considerable profit from a single product sale, given that the cost per conversion and product cost are both low.
This means you pay less for Facebook ads and enjoy big profit margins on every successful product sale.
(6). Delivery Is Faster
Compared to the products sold on the usual prepaid payment, all items sold on COD are way speedier.
The reason behind fast delivery is that suppliers who incorporate COD use exclusive and premium courier services.
Ideally, your merchandise will be delivered in 2-5 days, and payments will be remitted within a week, subject to the courier service of choice.
(7). No Payment Method or Payment Withhold
Pay has often proved to be a pain in the neck, more so in the absence of Stripe; merchants have issues globally.
But with COD, you won’t have to trouble yourself. You won’t have to worry about placing your payment on hold, worry about chargeback, or even pay a transaction fee.
The processing is undertaken immediately after your customer makes the payment, and the payout is within a week.
Drawbacks of COD
There’s a reaction equally for every action, with COD payment merits as its demerits.
The main drawback is that customers can reject the product, which is bad for business.
Customers rarely make plans to pay, and they can sometimes see and dislike the product on the spot.
The best way around it is to vend fast-moving or winning products.
COD IN DEVELOPING COUNTRIES
In certain countries, COD remains the renowned alternative to normal dropshipping for web-based retailers. With this model, it’s straightforward to set up independent businesses in these locales, and buyers don’t need credit cards.
You’ll figure that several independent firms in these countries prefer cash installments over credit installments. This way, these companies avoid the cost associated with credit cards.
Similarly, some shops with cash payment limits offer better pricing for consumers.
The bulk of drop shipping transactions in the Middle East are COD, and 60% of online deals in the Middle East and UAE are conducted via COD; thus, this has prompted the mushrooming of dispatching enterprises that offer COD assistance.
Countries like India.COD transactions significantly boost web-based trade. COD transactions speak to buyers without elective methods or those without full credit card payment for products.
Starting Cash On Delivery with Funnel Genie
Launching a Cash-on-Delivery business is pretty straightforward. Funnel Genie offers a one-week trial, which you should test-run.
This way, you learn how the platform works and familiarize yourself with Funnel Genie.
To begin, you’ll either start with the one-week free trial or create an account.
Then, there is plenty of training on how to acquaint yourself with the app on the platform.
As soon as you log in, you can pick from the Funnel Genie’s list of winning products and employ the funnel you wish to use to advertise the products.
It only takes a few clicks, and ads make money as products get delivered.
Conclusion
If you are looking for an enhanced, reasonably priced alternative to normal dropshipping, COD cuts leveraging Funnel Genie are undoubtedly the way to go.
The COD platform immensely expands drop shippers’ believability, given that pay is only upon product conveyance.
With heaps of focal points for buyers, COD’s orders colossally expand on equal footing with the ever-insatiable consumer needs.
You can start COD and get paid weekly in your bank account, country of origin notwithstanding. You’ll not fork out tons of money on Facebook ads as they were formerly used in countries such as the UK, US, Australia, etc.
The funnel genie lends you the leverage to target countries with reasonably priced CPAs. This way, you cut costs, aided by Facebook ads, resulting in more full profit margins.
Are you ready to start COD? Have you heard of COD, or do you have questions? Please comment below.
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