Cash on Delivery in Ghana: The risks & How Businesses can manage it better

Cash on Delivery (COD) sounds simple: a customer places an order, you send it out, they receive it and pay.

But anyone running a growing business in Ghana knows there is a lot between “order confirmed” and “payment received.”

The customer may not be home. Their phone may be off. They may change their mind when the order arrives. Or the address may be “the blue house after the provision shop.”

And yet, COD remains important for many businesses.

Customers like the reassurance of paying when their order arrives. For vendors, it can help close sales with customers who are not comfortable paying upfront.

The problem is that COD shifts some of the risk from the customer to the business. Your product leaves your hands before your money comes back. And as orders increase, those risks can multiply.

The Risks Hidden in Cash on Delivery (COD)

A COD isn't just a payment method. It creates a chain of financial and operational dependencies:

Order → Pickup → Delivery → Customer confirmation → Payment → Reconciliation

If something goes wrong anywhere along that chain, your business may be left dealing with more than a failed delivery.

1. Your stock can become tied up

When a customer places a COD order, your product is committed before you receive payment.

If the customer doesn't accept the order, the product may spend days moving between your shop, the delivery process, and a return.

Multiply that across several orders and a portion of your inventory can become tied up in transactions that haven't actually generated revenue.

2. Your cash can become unpredictable

COD means there is a gap between making the sale and receiving the money.

That gap matters.

If you are handling dozens of orders, you need to know what has been collected, what is still outstanding, and what should be coming back to the business.

Without proper reconciliation, it becomes easy for discrepancies to creep in.

3. Failed orders can eat into your margins

A COD order that isn't completed doesn't simply disappear.

There may be another delivery attempt, additional communication, return transportation, and staff time spent following up. The product may eventually return to you, but the cost of trying to deliver it has already been incurred.

For low-margin products, repeated failed COD orders can quietly eat into your profits.

4. Cash handling creates another point of risk

Once payment is collected, another responsibility begins: getting that money back into your business accurately.

If multiple riders are collecting cash across different locations, you need confidence that:

the amount collected = the amount recorded = the amount remitted.

Without proper controls, reconciliation can become a manual exercise involving receipts, phone calls, spreadsheets, and someone's memory. That's a risky way to manage growing transaction volumes.

So, How Can Vendors Manage COD Better?

You don't necessarily need to stop offering Cash on Delivery. You need to manage the risks around it. Here's how:

1. Confirm orders before they leave

Don't send every COD order out blindly.

Confirm the customer's phone number, delivery location, order details, and expected payment before dispatch. For higher-value orders, an additional confirmation can help reduce avoidable refusals.

A good logistics partner can also take on some of this customer communication, so your team isn't spending its day calling customers to confirm deliveries.

2. Keep a clear record of every COD transaction

For every order, you should be able to answer four questions:

Was it delivered? Was it paid for? How much was collected? Has the money been reconciled?

Use a system that connects the order, delivery status, and payment record. This makes it much easier to identify outstanding payments or discrepancies before they become bigger problems.

3. Know where your COD losses are coming from

Don't just count successful deliveries. Track the orders that don't make it through.

Look at failed deliveries, customer refusals, cancellations, reattempts, and returns. Over time, the patterns can tell you where you're losing money.

If certain locations, products, or customer behaviours consistently create problems, you can change how you handle those orders.

4. Have a defined process for failed deliveries

A failed delivery can quickly become a repeated cost if there is no clear next step. The customer may be unavailable, provide the wrong address, or change their mind at the point of delivery.

Instead of handling each case differently, have a process for recording the reason for failure, contacting the customer, scheduling a second attempt where appropriate, and deciding when an order should be returned.

This reduces wasted delivery attempts and gives your team a consistent way to recover orders.

Failed delivery → Customer contacted → Reattempt scheduled → Order delivered or returned → Payment/order status updated

5. Reconcile your cash regularly

Don't wait until the end of the month to discover that the numbers don't add up.

Reconcile your cash regularly by matching completed deliveries and amounts collected against your delivery records and bank or cash receipts.

This helps you spot discrepancies early, know exactly what you’re owed, and keep your cash flow under control.

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The question isn’t whether you should offer COD. It’s whether you can manage it at scale without losing control.

If COD is becoming harder to manage as you grow, complete the Uno Logistics Maturity Assessment to receive your Operational Readiness Score and practical recommendations for making your logistics more predictable.

Prefer to talk to someone? Connect with one of our Solutions Advisors. We’ll help you understand where the gaps in your business's logistics are and how to fix them.