The Hidden Truth About COD Locations
Not all cities are created equal in COD e-commerce. While your overall business might show healthy metrics, certain locations could be bleeding money through high return rates, failed deliveries, and excessive courier charges. One toxic city can single-handedly destroy your campaign profitability.
⚠️ Real Example
A Pakistani fashion brand discovered that Multan had a 73% return rate while Lahore had only 22%. Those Multan orders were losing ₨180 per sale in hidden costs.
Key Metrics to Track by City
1. Delivery Success Rate
The percentage of orders successfully delivered and paid for. This is your most important metric—everything else flows from successful delivery.
Benchmark Delivery Rates by Region:
🇵🇰 Pakistan High Performers:
- • Lahore: 75-85% success rate
- • Karachi: 70-80% success rate
- • Islamabad: 80-90% success rate
- • Faisalabad: 65-75% success rate
🚨 Pakistan Problem Areas:
- • Quetta: 35-45% success rate
- • Gilgit: 25-35% success rate
- • Remote KPK: 30-40% success rate
- • Interior Sindh: 40-50% success rate
2. Return Charge Impact
Different courier companies charge different return fees by location. TCS might charge ₨150 for Karachi returns but ₨300 for Quetta returns.
Calculate True Cost Per City:
Cost per order = (Delivered charge + (Return rate × Return charge))
Example: Lahore with 25% returns = ₨180 + (0.25 × ₨150) = ₨217.50 per order
3. Customer Quality Indicators
- Wrong Address Rate: Orders that can't be delivered due to incorrect addresses
- Customer Unavailable Rate: Multiple delivery attempts with no customer response
- Fake Order Rate: Orders placed with no intention to purchase
- Cash Collection Issues: Customers claiming they don't have money
How to Perform City-Wise Analysis
Step 1: Data Collection
Gather the last 3 months of data from:
- Your e-commerce platform (Shopify order data)
- Courier partner reports (TCS, Leopards, PostEx, etc.)
- Ad platform location data (Facebook, Google)
- Payment processor reports
Step 2: Create City Performance Matrix
Build a spreadsheet with these columns for each city:
| City | Orders Placed | Delivered | Success Rate | Avg Order Value | Cost per Order | Profit/Loss |
|---|---|---|---|---|---|---|
| Lahore | 1,200 | 900 | 75% | ₨2,500 | ₨220 | +₨680 |
| Multan | 400 | 108 | 27% | ₨2,400 | ₨420 | -₨180 |
Step 3: Identify Action Zones
🟢 Golden Cities
70%+ success rate, profitable
- • Increase ad spend
- • Create city-specific campaigns
- • Test higher AOV products
🟡 Fixable Cities
50-70% success rate
- • Optimize product selection
- • Improve confirmation calls
- • Test different couriers
🔴 Toxic Cities
Under 50% success rate
- • Pause ad campaigns
- • Add to exclusion lists
- • Consider COD alternatives
Optimization Strategies
For High-Performing Cities
- Create dedicated Facebook/Google campaigns targeting only these locations
- Increase daily budgets for successful city campaigns
- Test premium products with higher margins
- Use successful city data to find similar locations
For Underperforming Cities
- Implement strict confirmation call processes
- Add minimum order values to offset higher return rates
- Test different courier partners
- Create city-specific creative that addresses local concerns
For Toxic Cities
- Add to Facebook and Google ad exclusion lists
- Implement prepayment requirements
- Focus on different marketing channels (influencer marketing, etc.)
- Consider partnerships with local businesses
Track City Performance with Financify
Automatic city-wise delivery analysis. See which locations are profitable in real-time.
Start Free TrialCase Study: 40% Profit Increase
Brand: Pakistani clothing brand
Challenge: Overall 3.2x ROAS but barely profitable
Analysis Results:
- • 6 cities (Lahore, Karachi, Islamabad, Faisalabad, Multan, Sialkot) generated 80% of orders
- • Lahore and Karachi: 75%+ delivery success
- • Multan and Sialkot: 35% delivery success
- • Remote cities: 25% delivery success, eating 60% of profit
Actions Taken: Paused campaigns in 12 low-performing cities, increased spend in Lahore/Karachi by 200%, implemented minimum order values for mid-tier cities.
Results: 40% profit increase within 45 days with same total ad spend, just reallocated to profitable locations.
Implementation Checklist
✅ Weekly Actions:
- ☐ Review delivery success rates by city
- ☐ Identify cities with declining performance
- ☐ Adjust ad targeting based on performance data
- ☐ Update courier selection for specific routes
- ☐ Monitor cost per delivered order trends
- ☐ Test new optimization strategies for fixable cities