Risk of Product Damage
During the shipping process, products are at risk of being damaged. If COD is offered, we face complications if a damaged item arrives and the customer refuses to pay. This situation forces us to handle returns, repairs, or replacements, which can lead to financial losses
Cost of Shipping & Handling
Shipping products to customers and managing COD transactions can be costly. If a product is damaged or the delivery is unsuccessful due to payment issues, we incur additional costs related to reshipping, handling returns, or managing damaged goods. These costs can add up and impact profitability.
Unpredictable Cash Flow
With COD, payments are only received upon delivery, which can create unpredictability in cash flow. If there are issues with delivery or payment, it can affects our ability to cover costs and manage inventory effectively.
To mitigate these risks, we prefer prepayment methods that ensure they receive payment before shipping the product. This approach helps us to manage financial risks, control cash flow, and reduce the likelihood of encountering issues related to damaged goods or payment disputes.
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