A Seller's Guide to Cash on Delivery (COD) Labels in India

Let’s Talk About the Double-Edged Sword That Will Make or Break Your Indian E-commerce Business

I want to take you back to 2017. I was running a fledgling D2C brand in India, selling custom-printed t-shirts. We had a great new design, and we ran a small Facebook ad campaign. The response was electric. Orders flooded in. I was ecstatic. I felt like a genius. And then I looked at the payment method breakdown: 90% of the orders were 'Cash on Delivery' (COD). A little voice in my head whispered, 'This might be a problem,' but the intoxicating high of seeing 200 new orders was too strong. I ignored it. I printed the shirts, packed the orders, and shipped them all out via a cheap but cheerful local courier.

Two weeks later, the returns started coming in. Not a trickle. A flood. Box after box, stamped with that soul-crushing red ink: 'RTO - Refused by Customer.' By the end of the month, over 120 of those 200 orders had come back to me. One hundred and twenty. I was out the cost of the blank shirts, the printing cost, the packing materials, and, crucially, the shipping cost both ways. That single, naive campaign cost me over ₹80,000 (about $1,000 USD at the time), a catastrophic loss for my tiny bootstrapped business. I had been scammed, not by a hacker or a con artist, but by my own ignorance of the single most important, dangerous, and uniquely Indian aspect of e-commerce: Cash on Delivery.

Look, if you're a seller in the US, you can probably skip this article. COD is a relic for you. But if you are selling online in India, this is the most important thing you will ever read. Offering COD is not a choice; it's a necessity. A 2024 report from RedSeer Consulting estimates that over 60% of all e-commerce transactions in India are still done via COD, especially in Tier-2 and Tier-3 cities where the next billion consumers live. Refusing to offer it is like putting a 'Closed' sign on your digital storefront. But accepting it without a strategy is like playing Russian roulette with your finances. You will get burned. You will lose money. And you will want to quit.

After 5 years of dealing with the Indian market, I’ve learned the hard way how to tame the COD beast. This isn't theoretical advice. This is the hard-won, street-smart playbook for creating COD labels and a verification process that will slash your returns, eliminate fraud, and let you tap into the massive Indian market without going bankrupt. This is how you don't get scammed.

The Psychology of COD: Why Your Customer is Not Your Enemy (But You Still Need to Be Suspicious)

First, you need to understand why COD is so dominant in India. It's not because people are trying to scam you (mostly). It's a complex mix of factors:

• Trust Deficit: Many Indians, especially older generations or new online shoppers, have a deep-seated distrust of paying for something they haven't seen or touched. What if the website is a fraud? What if the product is a cheap knock-off? COD is their insurance policy.
• Digital Divide: While UPI has been a revolution, a significant portion of the population in smaller towns and rural areas is still not fully comfortable with digital payments or doesn't have consistent access. Cash is still king.
• Impulse and Convenience: COD removes all friction from the purchase. It's a low-commitment 'yes'. The customer thinks, 'I'll decide if I really want it when it arrives.' This is the part that creates the massive 'Return to Origin' (RTO) problem.

So, your job isn't to fight against COD. It's to build a system that filters out the low-intent, impulsive buyers and the outright fraudsters from the genuine, paying customers. Your first line of defense isn't your courier; it's your verification process.

The Pre-Shipment Fortress: Your 3-Step Verification Protocol (Do This or It's Over)

Step 1: Automated Phone Number Verification (The Bare Minimum)

The single most important piece of data on a COD order is the phone number. The delivery agent from Delhivery or Xpressbees isn't going to wander around looking for an address. They are going to call the customer. If the number is fake, the order is dead on arrival. It's a guaranteed RTO.

Most modern e-commerce platforms like Shopify India allow you to integrate a simple OTP (One-Time Password) verification app at checkout. This is your first wall of defense. If a customer can't provide a valid, working mobile number, they can't place a COD order. This single step will weed out a huge chunk of casual browsers and low-level pranksters.

Step 2: The Manual Confirmation Call (The Money-Maker)

This is the step most people skip because it feels like 'work'. And it's the step that will save you the most money. Before you ship, you or your staff need to call the customer.

Your Script:

“Hi, is this Customer Name? I'm calling from Your Brand Name to confirm your cash on delivery order for the Product Name for ₹Amount. We just wanted to confirm the address is correct and that you'll be available to receive it in the next few days. Can you please confirm?”

What this simple 30-second call does is incredible:

• It converts intent to commitment. The customer is no longer passively waiting for a package. They have actively confirmed it. They are now psychologically primed to accept it.
• It catches mistakes. You'll be shocked at how many times you hear, 'Oh, did I put that pincode? It should be...' or 'Can you add 'near the old water tank' to the address?' This is your chance to fix the address before it becomes a delivery failure.
• It exposes fraud. If the number is disconnected, or the person on the other end is confused and says, 'I didn't order anything,' congratulations. You just saved yourself a guaranteed RTO. Cancel the order and blacklist the number.

Personal Horror Story #2: The Prankster. (2019) I was selling phone cases. We got a COD order for ten expensive cases, totaling around ₹8,000, going to a hostel address. It felt a little weird, but we were busy and shipped it without calling. It came back a week later, marked 'Customer Unreachable.' I called the number out of frustration. A kid picked up, laughing. He and his friends had placed the order as a joke on their roommate. I was out over ₹1,000 in shipping costs. I implemented mandatory confirmation calls the very next day. Our RTO rate dropped by 40% in the first month.

Step 3: The Pincode Serviceability Check (The Final Gate)

Not all couriers deliver to all pincodes in India. And some charge a hefty 'remote area surcharge'. Before you print the label, you need to check if your chosen courier can even service that pincode efficiently. Most courier aggregator platforms like Shiprocket or Blue Dart's Location Finder have a tool for this. Just type in the pincode. If it's a non-serviceable area for your cheap courier, you have a choice: upgrade to a more expensive courier (like Blue Dart or sometimes even India Post Speed Post, which has the widest reach) and inform the customer of a potential shipping delay, or cancel the order. Shipping an order with a courier that can't actually deliver it is just paying for a scenic round trip for your package.

The COD Label Itself: Your Final Instruction to the Delivery Agent

Okay, you've verified the order. Now you need to create a label that screams 'COLLECT MONEY!' The delivery agent handles hundreds of packages a day. You need to make their job as easy as possible. A confusing label leads to mistakes.

Anatomy of a Perfect COD Label:

• 'CASH ON DELIVERY' in Big, Bold Letters: It should be the most prominent thing on the label after the address. Unmissable.
• The EXACT Amount to Collect: The 'COD Amount: ₹XXXX' should be huge, bold, and unambiguous. No room for error.
• Payment Mode: PREPAID vs. COD: Your label should clearly distinguish between them. For prepaid orders, it should say 'PREPAID' in big letters so the agent doesn't waste time trying to collect money.
• All the Standard Stuff: Recipient name, full address with landmark, pincode, and the all-important mobile number.

Manually creating this for every order is a pain. This is where a good label generator is a lifesaver. For example, a tool like the shipping label generator on SmartLabelPrint has dedicated fields for 'Payment Mode' and 'COD Amount'. When you select 'COD', it automatically formats the label with the big, bold warnings, ensuring the delivery agent can't possibly miss it.

The Great COD Fee Debate: To Charge or Not to Charge?

Should you charge an extra fee for COD orders? This is a hot topic. Courier companies charge you a COD handling fee (usually a flat fee or a percentage of the order value). The question is whether you pass this cost on to the customer.

My frankly honest advice: When you're just starting, eat the cost. You need to maximize conversions and get your first customers. Once you have a steady stream of orders and a good brand reputation (50+ orders a day), start adding a small COD fee. By that point, your brand is strong enough that a small fee won't deter serious buyers, but it will significantly discourage the pranksters and window shoppers. A 2023 Statista survey showed that while COD is the most preferred method, a majority of seasoned online shoppers are willing to pay a small convenience fee for it.

The Post-Shipment Struggle: Managing Returns and Building Your Blacklist

Even with the best verification, some RTOs are inevitable. A customer might not be home, might have a last-minute financial issue, or might just change their mind. The key is how you handle it.

• Track Your RTO Rate Like a Hawk: You need to know your numbers. What is your RTO percentage? Is it higher for certain regions or product types? Data is your weapon.
• Build Your Blacklist: Every time an order is refused without a valid reason, that customer's phone number and address go onto a blacklist spreadsheet. The next time an order comes in from that number? You either politely cancel it or send them a payment link and tell them you can only accept a prepaid order from them going forward. It feels harsh, but it's essential self-preservation.
• Work with a Good Courier Aggregator: Platforms like Shiprocket or Pickrr not only help you find the best rates but also have their own fraud detection and RTO prediction algorithms that can flag high-risk orders before you even ship them. This is invaluable.

Conclusion: COD is a Wild Animal. You Have to Tame It.

Look, COD in India is not just a payment option. It's a completely different business model. It requires a different mindset—one of healthy skepticism and rigorous process. You have to be proactive. You have to verify. You have to be meticulous with your labels. And you have to be ruthless with your blacklist. Ignoring COD means leaving a massive chunk of the Indian market on the table. But accepting it blindly is a guaranteed way to go out of business.

The strategies I've laid out here aren't complicated. They don't require expensive software. They just require discipline. The 30-second confirmation call, the pincode check, the clear label—these are the small hinges that swing open the big doors of profitability. I learned these lessons through thousands of rupees in losses and countless hours of frustration. You don't have to. Follow the playbook. Tame the beast. And go build your empire, one verified COD order at a time.