When we first started our web site in 1998, we were told to accept as many forms of payment as possible, so we started accepting COD's.
I have noticed since then, very few sites now accept COD's as form of payment, and a lot of them are credit card only payment.
I guess in Canada COD is more popular than the USA, however it is getting to be a major pain, however it accounts for 8-10% of our sales.
The downside is that our return rate (refused or unclaimed parcels) has steadly risen over the years to 5% of all COD shipments. Canada Post is now charging the shipping twice, so when a parcel is returned, we pay the shipping twice, and the COD fee, not counting the labour and time that went into packing the parcel.
When they do pick up the parcel, many of them have to wait until payday (sometimes even two paydays), and you do not see your money for 4 - 6 weeks.
I just wonder, if we drop the service, if the 10% will go somewhere else, or will scrounge up their parents or friends credit card, or will send a money order instead.
I think the COD people fall into two categories.
a) People with bad credit and no credit cards, or
who are maxed out.
b) People that want security, and wants to see a
parcel before handing over money.
Anyways, has anybody had any experince with handling COD's, and then cancelling the option, or any other comments or experinces?