E-commerce firms are getting ready for a period of uncertainty in next few days as a significant number of their purchase is done through cash-on-delvery (COD). Some companies plan to stop deliveries for cash, and all firms are of the view that this will help them reduce CoDs and increase margins over the long term. The CoDs proportion varies from 80% to as low as 0.5% for a few others.
Shopclues, whose 30% sales are CoD, told that the company will not allow cash deliveries for purchases of over Rs 1,500 for two days. Its co-founder r Radhika Agarwal told the paper that for long terms CoDs will dip faster, which will have a positive impact.
Snapdeal co-founder and CEO Kunal Behl, while welcoming the government’s move said it would raise the quantum of India’s economy moving through digital pipes. He also added that both Snapdeal and FreeCharge are committed to supporting all such initiatives.
A Flipcart executive felt that the move may be a hit for internet-based firms. He added that CoDs will go down further, which will bring more efficiency in terms of cost-per-delivery and make online payments more acceptable for users.
Expressing same concern, Sujayath Ali of fashion company Voonik and Lenskart’s Peyush Bansal said they have not yet decided on what to do with the products already ordered through CoD.
The concerns have come at a time when the government has decided to ban Rs 500 and Rs 1,000 notes in order to control black money.