When I first started learning about the possibility of remote shopping and buying things from the couch at home, I had a lot of concerns, product related concerns, and more concerns related to payment methods, what if my personal data was stolen? What if my bank account information is compromised? What if an amount I don’t want to pay is withdrawn? All these questions and others I often repeat in my head. At the time, online shopping was not yet a popular idea in Arab society, which made people around me (most of them) warn me not to put any of my banking data on any app or online store.
It’s been almost three years since I dealt with payment methods on receipts, and I don’t deny that I felt safe at the time, but at the same time I was faced with issues such as needing to save a lot of cash, or to offer certain categories of money, and while these issues seemed simple, they were unsettling and unsettling, and that’s what prompted me to try remote payments, I don’t believe in keeping my data on my phone – my phone – I don’t record any data related to my bank account, I keep my hand on my heart, fearing that the money will be stolen, but the first operation went through safely and smoothly Yes, this has become my usual way of shopping.
I know my intro is long, but all of it is to prove to you that there are a lot of people who only believe in pay when you receive, and that’s what we’re going to talk about in this article.
What are the options for paying upon receipt?
Cash on delivery, also known as cash payment, also known as “cash on delivery” or “pay on demand”, refers to the way that customers pay for the goods when they receive the goods and decide to keep the goods or goods, and return the goods to the online store again if the customer does not want to keep the goods or goods.
Paying upon receipt can expose the store to significant financial risk, at least for shipping costs, because it does not know whether the customer will eventually complete the purchase process and pay for the product, whereas the sale in this case is not finalized until the item is delivered and the customer decides to pay.
Is there any difference between payment after receipt of goods and prepayment?
Of course there is a difference; payment on receipt is one way in which the store bears at least the costs and risks associated with shipping the product, but does not guarantee that the customer will buy the product as the customer requested, but does not assume any obligation.
However, most stores that offer a cash-on-delivery option require the customer to pay a deposit or enter a bank card number with the order in order to charge the customer if the customer decides to keep the item, and as the name suggests, this payment method allows the customer to decide whether to keep the item and pay (for clothes that can be tried on) instead of making an immediate decision upon delivery, after receiving inspection.
In the case of prepayment, the customer pays first before receiving the item, of course most of the time online stores offer the customer the possibility to return or return the product if they are not satisfied or the product is faulty, and the essential difference here is that the online store will only ship the goods after payment.
What are the advantages and disadvantages of the pay after delivery option?
Pay-on-cash is beneficial to consumers for a number of reasons, as it is a risk-free experience for customers and it also helps them choose some products that may require ordering multiple versions, such as ordering certain clothes so that they can be ordered in more than one size or in multiple colors. Furthermore, payment upon receipt enables the customer to choose between a multitude of shapes or patterns and products without the burden of paying the prices of all these products until he has made his decision.
At the merchant level, paying first is one of the ways to encourage customers to buy, as I told everyone at the beginning, I don’t believe in sharing my bank data, which can increase cash flow for online stores or merchants. Of course, this matter is very important and beneficial to businesses. Often, customers get more product when they pay first.
For example, when a woman ordered a summer dress, she was confused about choosing the right color, so she asked for two or more colors to experiment and compare, but she felt that both colors would suit her, so she decided to buy both.
But at the same time, there is no doubt that pay-on-cash is a greater risk for merchants and e-stores than it poses for customers, since in this case, the seller bears the shipping and delivery costs, but there is no guarantee that the process will translate into an actual sale.
Additionally, if a customer submits multiple combo orders in order to try different sizes or colors of items or products, the merchant or store will most likely not be able to supply the items to another customer who wants them at the same time, thereby putting the customer on a waiting list from making a purchase, leading to a frustrating and poor user experience for the customer.
Most merchants consider cash-on-payment to be risky because there is no guarantee that customers will pay, which means merchants may face poor cash flow; moreover, if payment is not received at the same time as a request is received, it will be difficult for merchants to have sufficient liquidity to purchase new products or use the money for basic store expenses, which means disruption and delays for merchants.
Additionally, cash on delivery increases return rates, but unfortunately in some cases, returns are very expensive, costing the merchant a portion of their profits.
(Related article: 10 Saudi e-commerce platforms that provide cash on delivery)
How can I pay after receiving the goods?
Well, most people think that cash on delivery is only limited to cash payment, which is wrong, cash payment is one of the four ways that cash on delivery can be adopted, let’s explain it below:
First: Cash payment
This is the most common and well-known method to easily pay for the value of the product in cash, but unfortunately, one of the most prominent problems with this method is that it can turn couriers (delivery and shipping officials) into easy targets for thieves.
Second: mobile payment
In this method, postal/transportation/delivery personnel have a portable card reader through which they can process payment for goods that are delivered instantly. This method is suitable for services such as paying restaurants or collecting electricity or gas bills, but this method requires customers to have an electronic wallet and understand how to use it. Knowledge that most customers may not be familiar with.
Third: check payment
Checks are the best alternative to cash payment by issuing a check for the amount of the goods and products, but despite this, many people do not rely on this method, they consider it not the safest option as you simply do not know if the check will be returned after delivery but just cashed.
Fourth: Online card payment
If you want to give the customer a few days to decide whether to keep the product, paying online with a card is the best option for all parties, but unfortunately there is a risk of the product being stolen, damaged or returned, which also creates additional costs for the merchant.
at last.. While cash payments are a great opportunity to entice customers to shop from your online store and give them a sense of comfort and peace of mind that might lead them to order more, the process carries a lot of risk for you.
My suggestion is that paying after receiving the goods is one of the ways customers can go, but you may want to consider some tricks to induce them to pay in advance, such as free shipping, or deduct a certain percentage from the product price, no matter how small, also, don’t forget to provide the possibility of return so that customers can pay in advance with confidence.