Welcome offer
10% off your first order.
WELCOME10
COD Returns Are Quietly Killing D2C Margins
COD Returns Are Quietly Killing D2C Margins
Cash-on-delivery feels convenient for you. For brands, it's often the biggest hidden cost.
TL;DR
- 25-30% of COD orders get returned in Indian D2C
- That's shipping paid twice, revenue earned once
- Brands are now financing 15-30% of monthly sales just to cover the gap
A returned COD order costs more than a returned prepaid one — shipping both ways, plus a failed delivery attempt that never converted to cash, plus handling on a product that might not even be resellable.
Brands that fixed their return rates in 2026 mostly did one thing: gave a real reason to pay upfront — faster delivery, small cashback. Unicommerce calls it an operations saving, not a discount. Fair framing.
Quick Q&A
Does CAFE-X favor prepaid orders?
A little, yes — it's less about trust and more about not building a business model on a return rate this high industry-wide.
Is COD going away?
Not soon. But expect more brands to nudge you toward prepaid with small perks.
Sources
Shirting built the way this piece talks about — in-house, Gandhi Nagar.
Shop CAFE-X →