Home delivery or counter only for your shop?

Deliver if it brings orders you would not otherwise get, and only under rules: a minimum amount, fixed hours, and cash or a transfer at the door. Counter-only keeps your day simple and your money in the drawer. Most small shops end up somewhere in between, delivering to a short list of customers rather than to anybody who calls.

The order that comes by phone

A woman calls at four in the afternoon. Flour, oil, tea, some soap, about Rs 1,600 worth, and can somebody bring it because she cannot come out.

You say yes, because saying no to a customer feels like turning away money. Your helper puts it on the bike, and twenty minutes later he is back with the cash and everything is fine.

Then it happens again on Tuesday, and by the end of the month four households expect it. One of them orders Rs 300 of things at eight in the evening. One of them is never home when the boy arrives. And one of them has started saying she will settle at the end of the month.

Nobody decided any of this. The shop drifted into a delivery service without ever working out whether the delivery service makes money.

What delivery actually earns you

Start with the honest arithmetic, because the answer depends entirely on your own numbers rather than on anybody's opinion.

Say you send one Rs 1,600 order out on the bike

The value of the delivered orderRs 1,600

Your margin on it, at fifteen per centRs 240

Twenty minutes of a helper's paid timeRs 90

Fuel and wear for the tripRs 70

What that one delivery earned the shopRs 80

The number that matters is not the value of the order, it is the margin on the order against the cost of the trip. A Rs 1,600 order at a fifteen per cent margin earns you Rs 240. If the trip takes twenty minutes of somebody's paid time plus fuel, most of that Rs 240 is gone.

That is why delivery works on large orders and destroys you on small ones. The trip costs roughly the same whatever is on the bike, so the only lever you have is the size of what you are carrying.

It also explains why so many shops feel busier and no richer after starting delivery. The orders went up, the earning did not, and the difference disappeared into fuel and time that nobody was measuring, which is exactly the gap that working out your shop's real profit is meant to reveal.

What it costs beyond the petrol

The fuel is the cost people count. The others are larger and they arrive quietly.

Your attention is the first one. Every delivery is a small project: taking the order correctly, packing it, sending it, and following up on whether it arrived and whether the money came back. In a one-man shop, that happens instead of serving the people standing in front of you.

The second is stock discipline. Goods leaving the shop without a bill are how a stock count stops matching, and delivery is the easiest way for that to start happening. If nothing is written before the bike leaves, you have no way of knowing later whether what went out is what was charged.

The third is the one shops discover last. Delivery customers stop coming to the shop, and a customer who never walks in never buys the extra things people buy when they are standing in front of the shelf. The order becomes a list rather than a visit, and lists are shorter than visits.

There is a fourth cost that only shows up on bad days. A delivery promise is a promise with a time attached, and a shop that cannot keep it has damaged something a counter sale never puts at risk. A customer who waited two hours for flour she needed at six remembers that far longer than she would remember an ordinary out-of-stock.

And if delivery requires a second person, you have not added a service, you have added a wage, which puts you straight into the decision in hiring a helper or running the shop alone.

The credit trap that comes with it

This is the part that costs real money, and it is worth being blunt about.

Goods that leave your shop without cash coming back at the same moment are credit, whatever you call them. A delivery where the customer says she will pay later is not a delivery, it is an udhaar entry that happens to have travelled by motorcycle.

It is worse than counter credit for two reasons. There is no conversation at the moment of the sale, so the decision to extend credit is made by whoever is holding the bike rather than by you. And the customer is not in front of you when the amount is agreed, which means she is not in front of you when the balance is mentioned either.

The rule that fixes it is simple and it has to be absolute. Payment comes back with the boy, in cash or by transfer, unless you have personally agreed otherwise for that customer before the order leaves. Not "usually", not "for most people". Written on a card and told to everybody who ever takes a delivery out.

Where you do want to give credit on delivery, decide it the same way you would at the counter, using the same limits and the same names. A delivery list is not a reason to abandon the thinking in how much udhaar to give and to whom.

Counter only: what you keep by saying no

Refusing to deliver is a real strategy and it should not be described as being behind the times.

Delivering, and not delivering

You deliverCounter only

Who you can serveYou deliverAlso the people who cannot reach your shopCounter onlyOnly the people who can walk in

Where the money is decidedYou deliverAt a door, by whoever is holding the bikeCounter onlyAt your counter, by you

What happens to the stock countYou deliverOnly works if a slip goes out with every orderCounter onlyNothing leaves without being paid for first

What a customer buysYou deliverA list, and lists are shorter than visitsCounter onlyThe list plus whatever the shelf reminds him of

What it costs to runYou deliverFuel, time, and often a second personCounter onlyOne place, one queue, one cash box

A counter-only shop has one place, one queue and one cash box. Everything that happens, happens where you can see it. Your stock count works, your cash count works, and nothing leaves the building without somebody paying for it first.

It is also much cheaper to run. No fuel, no second person for the round, no time spent on the phone taking orders that a customer could have taken off the shelf herself in thirty seconds.

There is a quieter benefit as well. A shop where every sale happens at the counter is a shop where the owner sees his customers, and seeing people is how you notice that somebody has stopped coming, or is buying less, or is about to need something big. None of that reaches you through a phone order.

The cost of counter-only is real too. You lose the customers who genuinely cannot come: the elderly, the ones who work through your opening hours, the households where nobody is free in daylight. Those are usually good customers and some of them buy heavily.

So the honest way to put it is that counter-only is the right answer for a shop whose customers can all reach it, and the wrong answer for a shop that serves people who cannot.

The middle path most shops end up on

Very few shops that think about this end up at either extreme, and the middle is not a compromise so much as the actual answer.

The rules that make delivery pay for itself

• A named list of customers, not anybody who calls
• A minimum order, held to without apology
• Two fixed rounds a day, so one trip carries four orders
• Payment back with the goods, unless you agreed otherwise first
• A slip out with every order and a copy left in the shop
• The round reconciled the same evening, never the next morning

Deliver to a list, not to the world. A named set of customers who order regularly, whose amounts are worth the trip, and whose houses are on a route rather than scattered across the town.

Set a minimum order and hold it. Whatever number makes the trip worth taking in your own arithmetic, and it will usually be higher than you first want it to be. A minimum is not rude; it is the only thing that stops delivery from turning into a free errand service.

One shop that had drifted into delivering all day fixed the whole thing in an afternoon by writing three lines on a card and taping it beside the phone: a minimum order, two round times, and payment at the door. Two customers complained for a week. Everybody else adjusted, the rounds got fuller, and the owner stopped losing the middle of every afternoon to somebody else's shopping list.

Set hours and stick to them. One round in the late morning and one in the early evening beats being available all day, because a fixed round lets you carry four orders on one trip instead of four trips carrying one order each. That single change is often the difference between delivery losing money and making it.

And keep the shop the main thing. Delivery that grows until the counter is neglected has not grown the business, it has moved it, and that is a different decision entirely from the one in opening a second shop or growing the one you have.

Charging for it without losing the order

Most shopkeepers are afraid to charge and then quietly resent delivering. Charging openly is better for both sides.

Free above a certain amount and a small fixed charge below it is the arrangement customers understand instantly, because they have seen it everywhere. It also does your work for you: people either increase the order to clear the threshold, which is what you wanted, or they pay for the trip, which is also what you wanted.

Say the charge when the order is taken, never when it is delivered. A charge discovered at the door feels like a trick and it will be argued about in front of a boy who cannot decide anything. Said at the start, it is simply the price.

If you genuinely cannot charge because the shop across the road delivers free, then compete on the thing that actually keeps people, which is reliability. Arriving when you said, with the right things, and the correct change, is worth more to a household than a Rs 50 saving, and it is the ordinary way regular customers are kept.

Rules that keep delivery from eating your day

Whatever you decide, a few rules stop the whole thing from drifting.

Write the order down as it is spoken and read it back. Almost every delivery argument is about something missing or something the customer did not order, and reading the list back on the call removes both.

Bill it before it leaves. A slip goes with the goods and a copy stays in the shop, so what left and what was charged are recorded before anybody rides anywhere. This is also what makes the evening count possible, which is the whole point of counting the cash box every day.

Count the money in against the slips the same evening, not the next morning. A round that is reconciled while both people remember it is a two-minute job; the same round two days later is a disagreement.

And review the list every few months. Customers move, order less, or start paying late, and a delivery list that nobody ever prunes slowly fills up with the trips that are not worth taking.

Common questions

A customer asks for delivery and the order is small. Do I refuse?

Do not refuse, offer the alternative, because those are very different conversations. Say what your minimum is and offer to send it with the next round rather than as a special trip, which costs you almost nothing and still serves her. Most people accept happily, and the ones who will not were asking for a free errand rather than for your shop.

Should I charge for delivery or build it into my prices?

Charging openly below a threshold is cleaner, because building it into prices means every customer who collects for himself is paying for somebody else's trip. Hidden costs also make it impossible to see whether delivery earns anything. Keep the charge visible, keep it small, and keep the threshold high enough that the trip is worth it.

My helper delivers and sometimes comes back short. What do I do?

Fix the paperwork before you question anybody, since most shortfalls are ordinary rather than dishonest. Send a slip with every order, have him bring back the slip with the cash, and reconcile the round the same evening while both of you remember it. Where the record is tight, the problem usually stops without a single accusation being made.

Is it worth delivering if I have no second person?

Only on a fixed round when the shop can be left or closed briefly, and never on demand during trading hours. A one-man shop that leaves the counter for every call is losing counter sales to make delivery sales, which is usually a poor trade. One evening round on the way home is the version that works.

Customers ask for delivery and then want to pay at the end of the month. Is that reasonable?

It is a credit decision and it should be made the way every other credit decision is made, with a limit, a name and a date. What you must not do is let it be decided at the door by whoever is delivering. Agree it with the customer in advance, write it down, and let the boy carry goods rather than decisions.

How do I know whether delivery is actually making me money?

Keep a separate note of delivered orders for one month, with the value of each and the time each round took. At the end of the month compare the margin on those orders against the fuel and the hours, and the answer is usually obvious. Most shops that do this discover the large orders pay well and the small ones were carrying the whole thing at a loss.