Question

Explain the four major issues in online retailing as covered in Chapter 8.

Answer 1

Major issue in online retailing are :-

1. Cash on delivery slow down the businesses - COD is convenient for buyers but extremely inconvenient for etailers and sellers. It obstructs cash flow as such orders take longer to close. It often takes months for the money to reach the seller, that too if there’s no refund/return request. This makes it difficult for them to scale up or maintain daily operations.

2. Additional Cost :- The cost rises even further in case of returns as marketplaces/logistic companies deduct courier fees.

3.High Returns :- cash on delivery and no-questions-asked return policy is a deadly combination. People make impulsive purchases and return it without any fret. And sellers believe that COD orders lead to high returns and buyers give inane reasons as opposed to non-COD orders. This burns a hole in a seller’s, logistic company’s and marketplace’s pocket.

4. Fraud/Theft :- right from delivery boys being beaten up and robbed at gunpoint to theft during transit and fake orders, we have heard it all. Such instances mostly have been reported in case of COD orders. And what that has resulted in? Additional Expense.