由 caicai8478 The model is popular in Eastern Europe and some parts of Southern Europe, but there are also certain challenges due to differences in policies, logistics and consumer habits. The following is an analysis of the applicability, policy and logistics challenges of the European COD model:
I. Applicability of the European COD model
Consumer trust and payment habits
Eastern European market: Due to the immaturity of the online payment system, consumers prefer the COD model to reduce online shopping risks. For example, COD payments account for as much as 50%-60% in Poland, Hungary, Romania and other countries47.
Southern European market: Consumers in countries such as Spain, Portugal, and Italy also prefer COD, especially the middle and low-income groups4.
Western European market: Although credit cards and digital payments are popular, some consumers still choose COD to enhance transaction trust8.
E-commerce growth drives COD demand
The Eastern European e-commerce market is growing rapidly (for example, Slovakia’s annual growth rate exceeds 30%), and COD has become one of the main payment methods4.
After the Russian-Ukrainian conflict, inflation in Europe intensified, and the demand for inexpensive and high-quality Chinese goods increased, making the COD model more popular4.
Average customer price and acceptance rate
The average customer price of European COD orders is about 50 euros, and the acceptance rate is between 55% and 72% (higher in Hungary, Slovakia, and Italy, and lower in Spain and Portugal)4.
- Policy challenges
Strict consumer protection regulations
EU countries generally stipulate a 14-30 day right of no-reason return, and merchants need to bear the return shipping costs, which prolongs the payment cycle1.
Some countries (such as Germany and France) require additional tax compliance for COD transactions, increasing operating costs1.
Cross-border tax and customs policies
Different countries have different value-added tax (VAT) policies. Merchants need to register and declare in advance, otherwise it may affect customs clearance and payment collection15.
The customs efficiency of some Eastern European countries is low, which may cause logistics delays6.
Anti-money laundering and payment supervision
European banks have strict audits on cash deposits. Large COD repayments may be required to provide proof of transactions, which will extend the settlement time1.
III. Logistics Challenges
Long delivery cycle
Europe is geographically dispersed, and delivery to remote areas is slow (e.g., it takes several weeks from Eastern Europe to Western Europe), and there is no operation on weekends/holidays1.
The habit of inspecting goods before signing is common, and the rejection rate is high (about 20%), which further extends the collection cycle14.
High logistics costs
Eastern Europe has weak infrastructure and high last-mile freight (e.g., the return fee in Greece and Italy is twice that of Hungary)4.
Overseas warehouse layout affects costs. Spain (Madrid) and Hungary (Budapest) are major hubs, but delivery to remote areas is still expensive4.
Data and settlement delays
Slow data synchronization between logistics companies and e-commerce platforms may lead to delayed collection1.
Some platforms temporarily withhold funds due to complaints or disputes, affecting cash flow1.
IV. Countermeasures
Optimize logistics network
Use forward warehouses or overseas warehouses (such as Hungary and Spain) to shorten delivery time and increase the signing rate47.
Choose localized logistics partners to reduce return costs5.
Compliance and tax management
Register VAT in advance to ensure smooth customs clearance1.
Use prepaid mode (some logistics companies provide advance payment services) to ease financial pressure1.
Improve consumer trust
Optimize product descriptions and packaging to reduce rejection rates1.
Provide flexible return policies to reduce dispute risks8.
Conclusion
The European COD model has great potential in the Eastern and Southern European markets, but it needs to cope with challenges such as policy compliance, logistics efficiency and consumer habits. Merchants can improve the feasibility and profitability of COD business through localized operations, optimized logistics and strengthened compliance management.