A practical guide to COD order profitability in Pakistan
A cash-on-delivery order is not profit when it is booked. Teams need to distinguish revenue, payment collection, product cost, courier cost, marketplace fees, returns and operating expenses before trusting a net-profit figure.
Separate order status from payment status
Booked, in transit and delivered describe fulfilment. Pending, partially paid and fully paid describe money received. A COD order normally remains unpaid until delivery or settlement evidence confirms collection.
Preserve cost at the time of sale
Current purchase price can change after a sale. Store the applicable cost with the order line or use an auditable costing method so historical gross profit does not move when a new purchase invoice is posted.
Include channel and courier costs
Marketplace commissions, payment fees, delivery charges, return charges and order-specific expenses sit between gross margin and true contribution. Capture them separately so operators can see why two equally priced orders perform differently.
Treat returns as a workflow, not a status label
A returned parcel may restore sellable inventory, create a courier cost and reverse expected revenue. Confirm the physical item and financial outcome instead of assuming every courier return has the same accounting effect.
Compare equivalent periods
Compare this week with the previous week or this calendar month with the previous month. Filter by source and sale state, and avoid mixing orders that have not reached a comparable fulfilment stage.
Operational checklist
- Track fulfilment and payment independently.
- Retain cost at sale.
- Record courier and marketplace charges.
- Review returned stock physically.
- Compare like-for-like periods.